Can sports betting become an alternative investment market?
With all the turmoil in the economy and housing market, investors will either keep their cash on the sidelines or look to alternative markets. Most stocks are tied to economic news with no parameters or direction. It’s getting harder and harder for even savvy investors to time the fund. They have to become much more selective.
The sports betting market has been around for a long time with some controversy in the early years. However, there is a vibrant market in today’s highly competitive sports field. Nevada’s regulated sportsbooks have a monopoly on legalized sports betting. Can amateur recreational bettors make money on these books? Sometimes, but not long term.
The pros know how to look for the edge and only need to hit a minimum of 55% to get a modest return on investment. It is quite possible to get a return of 15% to 25% for the year. The good ones are few, but the results are quick and opportunities exist every day when bad betting lines are found and exploited. The so-called experts set the betting lines as to how they perceive the betting public will react. Ideally, they even want to bet on both sides. Their number is close about 65% of the time. Their recent Superbowl lineup wasn’t even close and they had the wrong team, the Indy Colts, with too many points. This happens a lot in all sports. They provide a good service, but their stats and computer models can only go so far. Investments in this area are limited in scale and cannot handle the millions or billions that are poured into those other markets. But investors with up to a million can see a very good return with the right professional.
The biggest competitor for these legalized Sports Books has been the Internet. Reputable online sports books were growing very fast until the Port Security Bill was passed with the Illegal Internet Gambling Act attached. One had nothing to do with the other. It was a disaster for many offshore publicly traded gaming companies and the American gambling public. Hopefully it will be repealed and the Barney Frank sponsored Regulated Online Gambling Bill will one day pass, but don’t hold your breath!
Internet gambling investment options, if legalized, are numerous and sophisticated. The newer formats are betting exchanges and spread betting in the UK, where internet betting is legal but that doesn’t help US punters. These new betting formats have many angles to invest in and give you an advantage if you know what to look for.
When the regulatory cloud over this industry is removed, you will see investment vehicles similar to the hedge funds and derivatives that are available in the other investment markets. Tax revenue alone could be millionaires if this market is regulated and legalized. For now, it looks like Nevada still has this market locked in. WE MEET IN LAS VEGAS!
