Title: Beating the bookies with their own numbers - and how the online sports betting market is rigged,
Abstract: The online sports gambling industry employs teams of data analysts to build
forecast models that turn the odds at sports games in their favour. While
several betting strategies have been proposed to beat bookmakers, from expert
prediction models and arbitrage strategies to odds bias exploitation, their
returns have been inconsistent and it remains to be shown that a betting
strategy can outperform the online sports betting market. We designed a
strategy to beat football bookmakers with their own numbers. Instead of
building a forecasting model to compete with bookmakers predictions, we
exploited the probability information implicit in the odds publicly available
in the marketplace to find bets with mispriced odds. Our strategy proved
profitable in a 10-year historical simulation using closing odds, a 6-month
historical simulation using minute to minute odds, and a 5-month period during
which we staked real money with the bookmakers (we made code, data and models
publicly available). Our results demonstrate that the football betting market
is inefficient - bookmakers can be consistently beaten across thousands of
games in both simulated environments and real-life betting. We provide a
detailed description of our betting experience to illustrate how the sports
gambling industry compensates these market inefficiencies with discriminatory
practices against successful clients.