Online gambling is gaining momentum, and with the advent of crypto-currencies, it is taking it to a new level. Still land based gambling is the predominant one, but given how much bitcoin gamblers are out there, this may change very soon. To answer the question in the title, yes of course it is, gambling is profitable, but only for the casinos. May 17, 2019 Betting on sporting activities can not only be a profitable pastime, done right, it can also be a great investment of your time and money. Here, we look at a few reasons why you should seriously consider sports betting as a way to make some money on the side. Its driven by technology.
You can bet on it: Sports gambling is about to expand, big time, in the United States.
Right now, the only place you can legally bet on sports is Nevada.
But on Monday, the Supreme Court struck down a federal law that prohibited legalized sports gambling anywhere but Nevada.
So what does this court decision mean, exactly?
Now that there is no longer a federal law against sports gambling, each state is free to pass laws that govern where people will be able to bet on sports and how.
'It'll be a state-by-state matter,' said Eugene Christiansen, an expert on casino gambling and consultant to the industry. 'I'm sure there will be a wide variety as to how fast or how slow the licensing proceeds.'
Are any other states close to approving sports betting?
Six states, including New Jersey which that brought the lawsuit to the Supreme Court, have already passed laws to allow casinos to take sports bets once the federal law was struck down, according to Geoff Freeman, CEO of the American Gaming Association. Those states are New Jersey, New York, West Virginia, Mississippi, Pennsylvania and Connecticut.
Another 12 states have introduced legal sports gambling legislation.
Even in states that have approved sports gambling, it'll take some time to complete the approval process, which will requirecompanies to be licensed in order to take sports bets.
'In the case of New Jersey I think we're talking weeks before we have sports betting in place,' he said. 'For most of the other states, I'd expect it start at the beginning of the football season this fall.'
How widespread will sports betting become?
There are a total of 40 states that have some kind of casino -- either state-regulated or tribal. Experts say they believe most if not all of those states will eventually allow sports gambling, simply because they won't want their own casinos to be at a competitive disadvantage with casinos just across state lines.
'It's the same reason we've seen the spread of casinos to so many states -- the states have been watching consumers going out of state to place bets,' said Josh Schiller, an attorney who has represented various gaming interests. 'People enjoy betting on sports.'
But experts say it could still take a few years before sports books are legal in states that haven't begun the process.
'Gaming law is something that typically takes time,' said Freeman. 'It's more complex than many people think.'
Will I be able to place a sports bet online in another state where it is legal?
Monday's decision only allows states to control gambling within their own borders. It does not open the door for interstate online gambling, or placing online bets with foreign sports books. That would require additional legislation or lawsuits.
How important is sports gambling for casinos?
Actually, it's not a very profitable business. For instance, gamblersin Nevada lost about $250 million betting legal on sports last year. But that equals only about 2% of the Nevada gaming industry's take overall.
Additionally, casinos have the potential to lose big on sports bets, unlike in house games. So sports betting can be the least profitable part of the casino, or even a money loser, according to experts.
Casinos fought for the approval to take sports bets because it's an important way to draw customers into the casinos. Otherwise, they would lose that business to illegal competitors, such as bookies and offshore gambling sites.
Gambling professionally probably has at least as much to do with what you don’t do as it does with what you do. The main thing to avoid is playing games where you don’t have an edge.
Some professional gamblers do play games where they don’t have an edge over the house, but they’re the exception to the rule. And even then, they stick with money that ISN’T part of their professional gambling bankroll.
In other words, if a professional gambler plays roulette, he does purely it for entertainment.
When I write a blog post, I usually try to assume that the reader knows little or nothing about the subject. So when I write a post about how professional gamblers only gamble with an edge, my first assumption is that the reader doesn’t know what a mathematical edge is.
That’s why the first point on this list explains the math behind gambling.
Psychology plays a big role in being a professional gambler, too. Depending on the nature of your gambling activities, you might only be making a moderate middle class income. In a lot of cases, professional gamblers sometimes go through dry spells and/or losing streaks. In those cases, they need to have money to live on.
Self-discipline and math skills are just for starters. Once you’ve developed those 2 skills, you still have to achieve a certain amount of proficiency in your chosen activity, regardless of what it is. Being a professional level poker or blackjack players requires skills. It takes a lot of effort to develop those skills.
In fact, most people aren’t cut out to be professional gamblers. For most people, the amount of effort required compared to the rewards aren’t worth it. It’s also hard for most people to divorce themselves from their emotions enough to make the kind of consistent, rational decisions necessary for success.
If you think you might have what it takes, this post provides as good of an introduction to the topic of gambling professionally as any you’ll find.
If you’re interested in learning more about making a living as a gambler, you might also check out the book How to Make $100,000 a Year Gambling.
1. Understand the Math
If you want to gamble professionally, you must have enough knowledge of math to understand some of the intricacies of probability. I can provide an introduction to the subject here, but you might consider buying a textbook or taking a class on the subject.
Probability is the branch of mathematics that deals with predicting the future. It examines in a black and white way the likelihood that certain events will occur. In fact, the word “probability” isn’t just a description of this kind of math. It’s also a description of the likelihood of an event.
The probability that something will happen can always be expressed as a number between 0 and 1. If something will NEVER happen, it has a probability of 0. If something will always happen, it has a probability of 1.
You can express a probability in the following ways:
- As a fraction
- As a decimal
- As a percentage
- As odds
Here’s an example of a probability expressed as a fraction:
You’re flipping a coin, and you want to express the probability that it will land on heads. You have 2 possible outcomes, each of which is equally as likely as the other. To express that as a fraction, you put the outcome that you’re looking at on top of the fraction (the numerator). You put the total number of possible outcomes on the bottom of the fraction (the denominator).
In this case, the probability is ½.
You have 2 possible outcomes, but only 1 of them is heads.
Here’s an example of that same probability expressed as a decimal:
By the way, this isn’t even a probability problem. It’s just an exercise in converting fractions to decimal. To convert a fraction into a decimal, you just divide the number by the denominator. 1 divided by 2 is 0.5.
You can also convert that into a percentage–which is easy for most people to understand:
To convert a decimal into a percentage, you multiply it by 100 and add the % symbol. 0.5 X 100 = 50%.
This is one of the most popular and easily understood way of expressing a probability. If you watch the weather on the news, you’re probably pretty familiar with this already. When the meteorologist says there’s a 50% chance of rain, you know what she means.
The words “per cent” mean “per 100”, so you can always think of a percentage as the number of times out of 100 that something will occur.
Expressing a probability as odds might be the least intuitive way to express this number, but it can be incredibly useful for gamblers. Instead of comparing the number of ways something can happen with the total number of outcomes, when you’re talking odds, you compare the number of ways something can happen with the number of ways it can’t happen.
In the coin toss example I’ve been using, the odds of getting heads is 1 to 1. You have 1 way to get a heads results, and you have 1 way to NOT get a heads result. This is called even odds.
In gambling situations, you risk money on certain outcomes. If the payoff odds for a bet are better than the odds of winning, you have a profitable situation. (Pros called that +EV, which stands for “positive expected value”.) If the payoff odds for a bet are lower than the odds of winning, you have a losing situation. (This is called -EV, or “negative expected value”.)
If you consistently put yourself in +EV situations, you can expect a profit when gambling. In fact, this is what casinos do all the time. It’s how they stay in business.
The rest of this post is filled with examples of +EV situations, but here’s an easy to understand example that continues from our coin toss discussions:
Suppose you’re convinced that you’re psychic, and you think you can predict with some degree of certainty which way the coin was going to land. In fact, you’re so convinced that you’re willing to bet $2 to win $1.
I’ll ignore any question of the likelihood that you’re really psychic, and I’ll just ask you the following question:
Who, mathematically, has the edge in this situation?
Obviously, it’s the other guy. He only stands to lose $1, and you stand to lose $2, and mathematically speaking, you both have a 50% chance of winning or losing every time.
If you assume 100 coin tosses, and you win 50 times, you’ve won $50. But you’ll also have lost 50 times, losing $100. Your net profit is -$50.
If you want to be a professional gambler, you want to be the guy on the other side of that bet. Pros don’t rely on psychic powers. They rely on math and the long run.
2. Develop Incredible Self-Discipline
Gambling is an emotional activity. All kinds of hormones and chemicals get pumped into your brain when you’re playing a game of chance for money. And once those get started, it’s easy to start making irrational decisions.
Professional gamblers can’t afford to be irrational. If and when they are irrational, they lose money. And losing money is not a way to make a living at any activity.
Here’s an example from the world of poker:
You’ve been playing solid poker for hours. You bet when you have a big hand, and you fold when you have lousy cards. You pay attention to position. You know what the other players’ tendencies are.
Over the last 6 hours, you’ve only had 6 hands worth playing, and you went into the pot of every one of them as the favorite to win.
And every single time, your opponent sucked out on you. He started with a worse hand, and then he got lucky.
So you start playing a little more emotionally. You start betting big when you don’t have the cards to justify it. You make raises when you know your opponent probably has a better hand.
This is called “tilt”.
It’s a great way to make a bad situation at the poker table worse.
And good poker players can smell when you’re on tilt. They’ll sit back and wait until they have great cards, then they’ll bust you.
Pro poker players don’t go on tilt. If and when they do, they quit playing until they have their emotions under control again.
Tilt can happen to any gambler playing any game. It takes self-discipline to avoid tilt and/or to change your behavior.
Professional gamblers also need the discipline to be extremely frugal. The nature of gambling is that your expected results happen in the long run. In the short term, anything can (and will) often happen. That’s why some slot machine players sometimes come home winners even though the odds are against them.
In other words, you can be the best at your chosen gambling profession and still have a losing month. In order to continue to pay your bills, you have to be frugal enough to be able to afford these downswings.
I was friends with an online poker professional a few years ago, before Black Friday. He and I discussed what it was like making a living playing poker online.
He told me that 5 months out of 6 he won 5 figures playing poker. But also, 1 month out of 6, he lost 5 figures. He was insanely profitable over time, but he did have 2 months out of the year when he was losing.
I couldn’t get him to tell me his exact numbers, but let’s look at the minimum he’s talking about. If you make $10,000 in profit 10 months out of the year, but you lose $10,000 2 months out of the year, you’re looking at a net profit of $80,000.
But you still have to eat, pay rent, and pay bills during those months when you’re losing money. That takes self-discipline.
Professional gamblers also need the discipline to maintain a bankroll. Recreational gamblers just need to make sure they have enough money to play as long as they want to. Their goal is to get maximum entertainment value for their money.
Professional gamblers need to make sure they maintain enough money that they can stay in action until the long term math kicks in and they start showing a profit. It can be hard to not dip into your gambling bankroll to take a pretty girl out on a date, or to buy tickets to a boxing match you really want to see, or to buy a new television when the pictures goes out on the one you have.
But it’s necessary if you want to stay in business.
A professional gambler is a businessperson. And businesspeople have to maintain enough capital to continue doing business.
It probably also goes without saying that people with impulse control problems—alcoholics, drug addicts, sex addicts, etc.—rarely succeed as professional gamblers.
The reason is simple:
If you can’t control your behavior, you’ll eventually start playing games where you don’t have an edge. You might get lucky for a while, but in the long run, you’ll lose all your money.
Professionals don’t lose money in the long term.
3. Become a Bookmaker
A bookmaker, if you don’t already know, is someone who takes bets on sports. At your local bar, you’ll often hear this person called “a bookie”. In the United States, it’s illegal to be a bookmaker unless you’re in Nevada and you have a license. That’s a legitimate, if expensive, option, by the way.
But you could consider becoming a bookie and make a living gambling, even if you don’t live in Nevada.
That’s probably not what you had in mind when you thought about betting on sports professionally, but think about who’s most likely to win money in a sports betting situation.
First of all, the bookmaker usually has you place $110 in action in order to win $100. And he’s also set the lines in such a way that he has equal action on both sides of a game.
If you’re a complete novice to sports betting, here’s what all that means:
“Action” is the amount of money you bet. If you have to bet $110 to win $100, that gives the other party an edge, but only if the other party has a 50% chance or better of winning the bet.
That extra $10, by the way, is called “the vigorish”, or “vig”. This is where bookmakers really make their money.
The line is the amount a team has to win by in order to consider it the winning team in a bet. For example, if the line has the Cowboys as a 7 point favorite over the Redskins, that means that the Cowboys have to win by 8 points or more for your bet to pay off. If the Cowboys win by 7 points or less, a bet on the Redskins is considered the winner.
The reason bookmakers create these lines is to create a situation where the bettors feel like they have a 50% chance of winning. If they succeed in this, then they get an equal amount of action on both sides.
Here’s an example:
10 people bet on the Cowboys to beat the spread. 10 people bet on the Redskins. That’s 20 X $1100 in action, or $22,000. Half of those bettors will win, and half of them will lose, because half of them took one side and half took the other. The bookmaker has to pay out $10,000 in winnings. But the bookmaker collects $11,000 in winnings from the other side, so they get $1000 in profit.
The losing side pays off the winning side and then some. That’s how the vig works, and that’s how the bookmaker makes his profit.
Small-time bookmakers might have trouble balancing both sides of a contest in this way unless they have an unusually large client base. Many of them place bets with other bookmakers to cover the action on the other side, too. Of course, they have to pay the other bookmakers vig, too, but it can help them cover the other side of the action.
Becoming a bookmaker involves more than just a willingness to ignore the laws in the United States. (In fact, please don’t construe this post as encouragement to break the law or as legal advice.)
You also have to put together a client base.
For most people, finding clients to bet sports with them isn’t too hard. You need to be reasonably personable, but finding clients is as simple as spending some time at a bar. The kind of bar you troll for clients at can make all the difference, though.
The best bars at which you can find sports bettors are small bars where the barflies drink hard and watch sports. You’ll do especially well with bars which have a crew of regulars in the afternoon before happy hour. Since there are regulars there, if you pick up one client, they’ll often refer you to other clients.
I have a friend who’s a CPA. One of his clients was a bookie. He said that his client never had a problem with the IRS turning him over to the FBI; as long as he was paying his taxes, everything was fine.
So that’s an important point:
Budget your income taxes into the equation.
Getting on the wrong side of the Internet Revenue Service is a big mistake.
Also, if you’re going to run an illegal bookmaking operation, keep a low profile. Don’t set up a website or take sports bets of any kind over the Web. Prosecution is rare with bookmakers, but it does happen. But it’s more likely to happen to high profile bookmakers with a Web presence.
And again, please understand that I’m not offering legal advice. This entire post is meant for entertainment purposes. But I think a lot of these details are instructional and helpful, too.
The bottom line is that it’s a lot more profitable to be the guy taking the bets than it is to be the guy making the bets.
4. Own a Casino
Another way to profit from gambling is to own the casino. This might be a stretch for a lot of people. There are licensing and financing issues that are beyond most folks’ ability to comprehend, much less implement.
On the other hand, no one in the gambling business is more profitable than the owner of the casino. You’re still gambling, but you’re gambling with the odds in your favor on every bet.
That’s the best way to gamble professionally.
Underground casinos are possible, too, but in most states, it’s a felony to run an illegal gambling operation. Depending on how strict the laws are in your area, you could wind up with some serious probation or even jail time.
That being said, I don’t know how many bars and/or gas stations I’ve visited in the state of Texas which had “8-liners” in them. That’s just another way of saying “slot machine”. Theoretically, these games are legal as long as no one’s winning any cash.
But let’s be realistic.
I was a regular at a bar in Dallas for years. They had a couple of 8-liners in the back near the jukebox. If you won a significant amount of money, you didn’t get paid off in cash by the machine. You told the bartender, and on Friday, you went into the bar to pick up an envelope from the owner. The envelope contained your winnings, in cash.
A buddy of mine won a few hundred dollars one week. He called the bar to talk to the owner on Friday, wanting to ask when he could pick up his envelope. Of course, the owner didn’t know my friend, so he said, “I don’t give envelopes to people I don’t know.”
I had to call the owner and explain to him who my friend was. Once he knew, everything was okay.
That’s a small-time casino, I know, but I can only imagine how much money those 2 machine made. I knew one old carpenter who lost $300 in those machines on Thursday night. He borrowed $200 from me to try to catch up. He lost that, too.
To his credit, he paid me back the following Thursday, as promised. But if he was dropping that kind of money on those machines on a Thursday night, how much money were the other regulars putting in there?
I asked the bartender one night, and he seemed to think they were making at least $1000 per week from each machine on average. That’s not bad for a bar so small that the maximum legal occupancy was 60 people.
On the other hand, had they ever gotten busted, it would have been a drag.
I also had a couple of friends who owned underground poker rooms. I’m lumping this into the professional gambling category even though the house isn’t really gambling in this situation—they just collect a percentage of each pot over a certain amount. That 5% or so that they collect from the pot is called “the rake”. It’s basically the same thing as the house edge for a casino or the vig for a sports book.
I did some of the math once about how much money you could make owning an underground cardroom. I figured that you could rent a decent apartment or office space for $1500 a month. Your electric bill would probably run $200 a month, and you might budget $300 for other miscellaneous expense. I’m not 100% sure, but I think the dealers worked only for tips.
But how much money were you looking at making?
If you have 4 full tables most of the time, you have 36 players. Assuming each table plays about 50 hands per hour, that’s 200 raked hands per hour. If the size of the average pot is $20, that’s $4000 per hour in action, and $200 per hour in profit for the cardroom.
Let’s assume you’re only open 4 nights a week for 8 hours a night. That’s 32 X $200, or $6400 per week. Even if you assume that my assumptions are too optimistic and you divide them by 2, $3200 per week more than covers your expenses and leaves you plenty of profit.
Let’s talk about something else related to owning your own casino—the house edge. Most of the time, when we talk about a casino, we talked about a business that hosts casino games. All of these games pay out at odds less than the games offer.
The difference is the house edge. It’s expressed as a percentage.
The house edge is a long term expectation. We’re talking about a near infinite number of bets. But a casino with a reasonable number of customers nears that long term expectation much faster than an individual playing those casino games.
That’s why casinos are able to continue to get customers. In the short run, players can win.
But in the long run, the casinos inevitably win.
You want to be a professional gambler?
Own a casino.
Here’s an example of the house edge:
American roulette has 38 numbers on the wheel. 18 of them are black, and 18 of them are red. 2 of them are green.
You can bet on black and get an even money payoff if you win. But you’re not facing 50/50 odds of winning at all.
You have 18 possible winning situations and 20 possible losing situations. The total number of possible outcomes is 38. So your odds of winning are 18/38, or 9/19.
That means the percentage chance of winning that bet is 47.37%. The probability of losing is 52.63%.
Suppose you placed 100 bets and saw mathematically perfect results. If you were betting $1 per bet, you’d win $47.37 and lost $52.63. Your net loss would be $5.26.
And that is the house edge for roulette—5.26%.
The house edge varies from game to game, but the house always has an advantage in a casino. (There are exceptions that I cover later in this post.)
5. Learn to Cheat
This might be the riskiest professional gambling technique on the list. I don’t recommend it, actually, but it’s an option. Cheating is anything that changes the conditions of the game in order to give you an unfair advantage.
Here’s an example:
You have long, sharp fingernails. You’re playing poker. You mark the backs of certain cards with your fingernails.
Now you know when your opponents have certain cards. You have an advantage that the other players don’t have. It’s also unfair, because you have, without their knowledge or consent, changed the conditions of the contest.
Get caught doing this in some poker games and you’re likely to get shot–or at least beat up. The shooter or the guy delivering the butt kicking will also take your money, which is a net loss instead of a win.
That’s not the only way to cheat at gambling. Past posting is one popular way to cheat. That’s just a matter of putting additional money on top of your bet after you’re already aware of its outcome. It’s almost impossible to get away with, and if you get caught doing it, you can face arrest and prosecution.
Any number of card tricks are possible if you’re a card mechanic. You can deal people whatever cards you want without their knowing it. This can obviously create a tremendous advantage for you.
You can play craps with loaded dice. Again, this changes the conditions so that the game of chance is no longer fair.
You could bribe a boxer to take a dive. This is also a way of changing the conditions of a bet and give yourself an unfair advantage. That technique is popular in the movies, by the way, especially in film noir.
Slot machine cheaters have used various devices to rig those games in their favor, too.
Cheating is NOT the same thing as advantage gambling, though.
6. Count Cards in Blackjack
The best-known advantage gambling technique is card counting in blackjack. “Advantage gambling” just means using legal techniques to put the odds in your favor instead of the house’s. Since counting cards basically just involves thinking about the game while you’re playing, it’s hard to consider it “cheating”—even though the casino tries to imply just that.
This site has lengthy pages about counting cards in the blackjack section, but I’ll explain it in simple terms here, too. I’ll assume you know next to nothing about the game.
Your goal in blackjack is to get as close to 21 without going over and beat the dealer’s total. You start by getting dealt 2 cards. The cards are worth their face value except for the ace and the face cards. The ace is worth 1 or 11, whichever you prefer. The face cards are worth 10.
If you get dealt a “natural” or a “blackjack”, you immediately win a 3 to 2 payout on your bet. So if you bet $100 on a hand, and you get dealt a natural, you immediately win $150.
This bonus payout on that hand is where counting cards can get you an edge. Unlike most gambling games, blackjack has a memory. Here’s what I mean:
When you play roulette, and a ball lands on a particular spot on the wheel, the number of spots remains the same on the next spin. There were 38 slots, and you had a 1/38 probability of getting any particular number. On the next spin, the odds are the same—1/38.
But in blackjack, every time you deal a card, you change the odds.
There’s an easy way to understand this, too.
You have to be dealt an ace in order to get a natural. If you’re playing with a single deck, and all the aces have been dealt, it’s impossible to get a 2 card total of 21.
On the other hand, if the ratio of 10s and aces in the deck to lower cards in the deck is relatively high, your odds of being dealt a natural increase. This means you’re more likely to get that 3 to 2 payout.
And that’s exactly what card counters do. They track the ratio of high cards to low cards, and when there are a lot of high cards in the deck, they raise the size of their bets in order to get those extra winnings.
Since blackjack has a 0.5% to 1% edge on average, it doesn’t take much of a chance in the odds to turn the game into a positive expectation proposition for the player. By betting the minimum when the deck doesn’t favor you, but betting a lot more when it does, you improve your odds against the casino to a point where you have an edge over the casino of between 0.5% and 1%.
This doesn’t mean much in the short run. You can easily lose a lot of money even when the odds are in your favor. But in the long run, over a lifetime of play, you’ll eventually see a profit.
The expected amount of that profit is easy to calculate, too. You just look at how many bets you place per hour, then you multiply that by the edge you have over the house. You multiply that by your average betting size.
Here’s an example:
You’re playing at a table where you’re getting 50 hands per hour. You’re betting an average of $100 per hand, so you’re putting $5000 per hour into action. If you have an edge over the casino of 1%, you expect to win—in the long run—an average of $50 per hour.
That’s not a great living, by the way. It’s roughly $100,000 a year if you’re playing 40 hours a week. But I don’t know any blackjack players who spend that much time at the table. In fact, I don’t know many people who would WANT to spend that much time playing a card game of any kind (except poker, maybe).
Spending that kind of time at the blackjack table means avoiding heat from the casinos. “Heat” is just a jargon term describing the efforts of a casino to stop players from counting cards. They reserve the right to refuse to let you play blackjack. They even sometimes ban players from a casino altogether.
To avoid heat, most card counters limit the amount of time they spend at a particular table to an hour or less. They also limit the number of times they play at a casino each week to once or twice. They also avoid playing at the casino during the same shifts.
This makes it harder to get in 40 hours a week.
One way card counters make more money is by working in teams. They have various techniques for avoiding heat from the casino. One example is the “big player” strategy.
Most card counters raise and lower their bets based on the count. That’s a big clue to the casino that you’re an advantage player. But blackjack teams will sometimes have a player who just flat bets the entire time he plays, regardless of the count.
But when the count gets really positive, he signals the “big player”. This player is wandering the casino floor, acting drunk (and rich). When he sees this signal, he walks up to the table where the count is positive, and he places a huge bet. Having the increased odds of getting a blackjack on this huge bet gives the entire team an edge.
And that’s just one advanced technique that card counting teams use to get an edge over the casino. Professional blackjack players have a whole list of techniques they can use to get an edge over the house, including things like shuffle tracking and dealer tells.
7. Master Video Poker
Video poker is my favorite casino game. It looks like a slot machine, but in reality, the games are dramatically different. Here’s why:
Both games involve lining up randomly generated symbols in a line on a computer screen. In slot machine games, these symbols could be anything, but they’re often fruit, bars, playing cards, or novelty symbols tied into the theme of the game. In video poker, they’re always playing cards.
The big difference is that on a slot machine game, you have no way of knowing what the odds are of getting any particular symbol. You know what you get paid off for the various combinations, but without the odds of getting those combinations, you can’t make any kind of judgment about how much of an edge the house has over you.
But on a video poker game, the odds of getting each symbol are the same as they would be if you were playing with a real 52 card deck of cards. (If you’re playing in a game with a joker, it might be a 53 card deck.) This does something for you—it enables you to calculate the payback percentage for the game.
Okay—that’s another new phrase I’ve introduced to you. The “payback percentage” is the flip side of the house edge coin, and it’s used to describe gambling machines. Subtract a game’s house edge from 100%, and you have the amount it’s expected to pay back over time.
For example, if you’re playing a slot machine game with a 4% house edge, the payback percentage is 96%. Of course, slot machines are the ONLY game in the casino where you don’t know what the house edge is.
But that’s the first major difference between slots and video poker. You can calculate a video poker game’s payback percentage and house edge by analyzing the payoffs for each combination (in poker terms, each “hand”) against the odds of getting each hand.
Here’s the other major difference:
On a slot machine game, you don’t really make any decisions of any consequence. You put your money in, spin the reels, and hope for the best. But on a video poker game, once you get your 5 cards, you then decide which cards you’re going to “hold”. The computer then deals your new cards.
This means that there is a mathematically correct way to play every hand. Your goal is to maximize your expected return on every hand.
Here’s an example of how you might need to compare options in a video poker game:
Let’s say you’re dealt a hand that consists off the ace, king, queen, and jack, all of hearts. The 5th card in your hand is the jack of spades.
So you have 2 big options here to choose from. One of them is to hold the pair of jacks. After all, that’s a sure win—but it only pays even odds. You basically have a 100% chance of getting a 1 coin payout. (I’m using a standard Jacks or Better pay table for this example.)
You also have the option of discarding the jack of spades and trying to draw a 10 of hearts. If you get the 10 of hearts, you’ve hit a royal flush, which has the highest payout of any hand in the game. In fact, it pays 800 to 1. But there’s only one card in the deck which will make that hand for you.
What’s the better decision?
To calculate the expected value of a decision, you multiply the probability of winning the bet by the payoff.
We already discussed how you have a 100% chance of winning 1 coin, which is a 1 coin expected value.
But not we have to look at the probability of hitting that royal flush. The odds aren’t great. But we can calculate it accurately.
You only have 1 outcome that will work. But you have 47 possible outcomes total. So the probability of getting the card you want is 1/47, or about 2%. A 2% chance of winning an 800 coin payout is an expected value of 16 coins.
Since 16 coins is better than 1 coin, you would opt for drawing to the royal flush, even though 98% of the time you’ll miss your hand.
Perceptive readers might notice that this is a hugely simplified way of calculating which is the better decision. I didn’t account for the fact that you might also hit 3 of a kind, 4 of a kind, full house, a straight, or a flush, depending on which choice you made.
But you get the idea.
Since you can calculate the payback percentage and the correct decision, you can treat video poker a lot like blackjack. It’s a low house edge game, and there are ways of getting an edge over the house.
One way is to just stick with extremely good pay tables. If you can find a “full pay” Deuces Wild video poker game, and if you can play it with perfect strategy, you can achieve a payback percentage of 100.76%. That’s an edge over the house of 0.76%. That’s comparable to what blackjack players achieve.
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(A “full pay” video poker pay table is the best possible version of that game—the one with the highest payback percentage. Different casinos and different machines within the same casino might have less optimal pay tables. In fact, they often do.)
Here’s the problem with specializing in full pay Deuces Wild:
There are only a tiny handful of casinos in the country that even make this game available. Most of them are on the Boulder Strip in Las Vegas. And the games are only available in low limits.
How much money could you realistically make playing full pay Deuces Wild professionally?
You always bet 5 coins per hand in video poker, so you’re looking at wagering $1.25 per hand. If you’re a pretty fast player, you can play 600 hands per hour. That’s $750 per hour in action.
If you’re winning 0.76% of that, over a long period of time, you’re looking at averaging $5.70 per hour in winnings. That’s not even minimum wage.
But most video poker players are combining games with a slight negative expectation with other factors to increase their overall payback percentage to over 100%.
Here’s an example of that:
One player might be playing Jacks or Better with a 99.54% payback percentage. But he’s also a member of the rewards club at the casino, so he gets 0.2% back.
But that still doesn’t create a positive expectation. He’s still playing a casino game with a house edge, albeit a small one of just 0.26%.
But this player decides she’s going to only play this game during the triple points promotions. Now she’s getting 0.6%. This gets her a tiny edge over the house, but she’s retired, and she sees it as an opportunity to gamble for free and get cool stuff on her vacation.
Also, she can play for higher stakes. This casino has dollar machines AND $5 machines. So she can bet $25 per hand. That’s $15,000 in action per hour. With an edge over the casino of only slightly more than 0.1%, she’s still making more money per hour–$15 per hour instead of $5.70.
The real video poker pros wait until a progressive jackpot gets big enough that the game has a really high edge for the player. The higher the progressive jackpot gets, the lower the house edge. At a point, it becomes so low that the odds are actually then in the players’ favor.
When this happens, advantage gambling teams usually stake out all the seats on those games. When they need a break, someone else from the team will take their spot. When the jackpot is finally won, the team splits the proceeds.
8. Play Poker at a Professional Level
Betting on sports and playing poker are probably the 2 best ways to become a professional gambler—short of owning your own casino. That’s because these 2 ways are both profitable and reasonably easy to get involved in, at least compared to the other options on this list.
But it’s not as easy to be a long-term winning poker player as you might think. And if you’re playing Texas hold’em, which you probably will be, since it’s the most popular poker game today, you’re dealing with a huge luck factor. In fact, lots of people get on winning streaks in hold’em even though they’re playing terribly. When their long term expectation kicks in, they’re awfully disappointed.
The reason that it’s hard to beat poker is because most of the time you have to not only be better than your opponents, but you have to be better than they are by a certain amount. Most cardrooms take 5% of every pot. So not only do you have to be better than the other players, you have to be far enough ahead of them to make up for the 5% and then some.
Most of the literature I’ve seen about professional poker suggests that you measure your hourly rate in poker in terms of big bets won. The big bet is the number after the / when you’re talking about the game’s limits. For example, if you’re playing in a $5/$10 limit game, you’re looking at your winnings in terms of $10 per hour.
A poker professional can count on a long term winning rate of 1 or 2 big bets per hour. But if you’re playing online exclusively, you can increase that multiple by playing more per hands per hour and by playing at more than one table at a time.
If you’re good enough to win one big bet per hour, and you can manage playing 4 tables at once, you can win 4 big bets per hour.
Can A Nonprofit Be Profitable
To make a reasonable living, let’s assume you need to earn at least $10,000 a month. If you specialize in $5/$10 holdem, you need to be able to win 1000 big bets per month. At 4 big bets per hour, that’s 250 hours per month of play. That’s a little over 60 hours a week of play.
Most poker players can’t play for 60 hours a week and maintain any kind of quality of life. So you have to look at ways to increase your hourly earnings.
You can do this by playing more tables at once.
You can do this by increasing the amount you win per hour.
You can do this by playing for higher stakes.
Let’s say you’re able to increase all of these factors by 50%. Now you’re playing 6 tables at a time. You’re playing for $7.50/$15. And you’re now winning 1.5 big bets per hour.
You’re now earning $135 or so per hour. To make $10,000 per month, you need to play for 74 hours per month. That’s less than 20 hours a week, and that’s a little more like it.
None of these numbers are exact, either. Your hourly earnings will fluctuate upward and downward over time. The level of competition will improve and get worse. Your energy levels will fluctuate, so you might play more or fewer hours a month.
You might change stakes based on fluctuations in your bankroll. You might find that the competition gets much better at one level compared to another, so you might have to stay at a certain level before moving up. You might never get good enough to move up to the next level.
No limit players, by the way, measure their progress by ROI (return on investment). They look at how much money they’re putting in the pot per hour and what percentage of that they expect to win. They also face higher bankroll fluctuations. But their potential profits are higher.
Tournament players also look at return on investment as their key performance indicator. You might lose 80% of the tournaments in which you play, but you make enough money from the 20% you place in to make up for your losses and more.
If you’re really good and really lucky, you might be able to win the World Series of Poker Main Event. Pull that off, and you’ve made a living for the rest of your life. But even great players know that winning that event is like winning the lottery.
Here’s why:
Let’s say you’re 3 times as good as the average player in the World Series of Poker. There’s a $10,000 entry fee for this tournament. The top prize in 2015 was $7.7 million, and anyone finishing in the final 9 won at least $1 million.
Your odds of being the first place winner would be 1 in 6420 if you were playing with players who were all exactly as good at poker as you are and no better. But since you’re 3 times as good as any of them, your odds of winning first place are 1 in 2140.
That’s still a longshot, but it’s not quite as bad as the lottery.
And you still have a good shot at being in the final 9, too. The odds for that are 9 in 6420, and since you’re 3 times as good as the average player, that’s 27 in 6420. That’s a 1 in 238 chance of winning a million dollars on your $10,000 entry fee.
Your odds of winning anything at all, or at least getting your entry fee back, are actually quite good in this scenario. The top 1000 places paid out, which is 1000 out of 6420, or roughly 1 in 6.4. If you’re 3 times better than your opponents, you have an almost 50% chance of finishing in the money and at least making a small profit.
Here’s the trick though:
Getting to a point where you’re that much better than the average player at those stakes takes a lot of time, effort, talent, and smarts.
Poker isn’t a physical activity, but you can still consider it a sport. Some people are talented at sports, but some people just don’t have what it takes to excel.
Think about it this way:
No matter how much you practice, you’ll probably never be as good a quarterback as Peyton Manning. He just has more innate talent than you do. (And I apologize to anyone reading this who’s the exception to the rule, but what are the odds of that?)
The same might hold true for poker. Many players, no matter how much they practice, will never have enough talent to compete with the likes of Doyle Brunson, Phil Hellmuth, or Daniel Negreanu.
This doesn’t mean you should avoid the Main Event at the World Series of Poker. It’s still a game of chance. Even if you’re only half as good as the other players, you still have a chance of coming out the winner. It’s just that your chances are 1 in 12,000 instead of 1 in 6000.
How do you get good at poker?
The same way you get to Carnegie Hall—practice, practice, practice.
I suggest starting by playing online at some of the free games. Read a basic book about the game you’re most interested in—probably Texas hold’em, since that’s where most of the action is.
As soon as you can, move up to real money games. The way people play differs dramatically even when there’s only a tiny amount of money on the line. Even $0.01/$0.02 games see better hands winning the pots and more people folding.
Can Small Farms Be Profitable
As you start winning consistently, you can go up in stakes. You should go up in stakes as soon as you have a large enough bankroll to avoid going broke at the next level.
You should also read books about the game. Some of the better ones include Super/System, which was edited (and partially written by) Doyle Brunson, Small Stakes Holdem by Ed Miller, and The Theory of Poker by David Sklansky. In fact, The Theory of Poker is essential reading for anyone who wants to seriously learn how to win at the game in the long run.
9. Play Daily Fantasy Sports
Daily fantasy sports were started by a lot of the people who were involved in the online poker industry. The launch of these games was directly a result of the passage of UIGEA (The Unlawful Internet Gambling Enforcement Act). That law had a specific exemption built into it for fantasy sports. So the poker moguls put their heads together and figured out that they could shorten the time frame for the fantasy sports contests and treat them just like poker tournaments in terms of buy-ins and payout structures.
Smart players who know a lot about sports are able to put together teams that are more likely to win. And if you can beat the other players often enough to overcome the vig or the rake, then you can make a profit playing daily fantasy sports.
Of course, I should explain how the vig works in fantasy sports. If you’ve played poker online, you’re probably familiar with the structure already.
To enter a daily fantasy sports league, you pay an entry fee of something like $10 + $1 or $20 + $2. The first number is the amount of money that you’re contributing to the prize pool. The 2nd number is a fee that you’re paying to the house. If you’re in a $10 + $1 tournament with 10 players total, the prize pool is $100. The other $10 in entry fees goes to the house.
In order for you to show a positive ROI playing daily fantasy sports, you have to be able to win often enough to compensate for the additional feels. The reasons why should be obvious.
Suppose you are just as good as everyone else in a daily fantasy contest. If there were 10 contestants, you’d be expected to win once out of every 10 times. So you’d win $100 over 10 contests, which is $10 per contest. But you’d still have lost another $10 in entry fees.
On the other hand, if you won twice, you’d have won $200, but you’d still have paid $10 in entry fees.
So the better your chances of winning are compared to the other players, the more likely you are to be able to beat the vig.
The intricacies of winning these daily fantasy contests are many. You have to decide which kinds of tournaments you prefer—the 50/50 tournaments and the ones with the big prize pools. Different strategies are rewarded in each type of tournament.
If you’re playing the 50/50 tournaments, which are also called “cash games”, you’re looking at minimizing volatility. You want dependable players. You want a balanced team that you’re certain is going to outscore the average team, but they don’t have to outscore the team by much.
In this type of contest, half the field gets paid—the top half. So you don’t get any more money from being the #1 point-scorer than you would if you were #49 or #50 in a 100 entrant tournament. So you’re looking to put together a fantasy team that has an 80% chance of scoring 120 points, not one that has a 35% chance of scoring 180 points.
The other type of daily fantasy sports contest you can participate in is called a tournament. In this type of content, the top players get paid more based on how they placed. For example, the winner of the tournament might get 30% of the entire prize pool. 2nd place might get 20%. The other top 18 players out of 100 might get the rest.
In this case, you have to go big or go home. You have to embrace volatility. And you need a team that’s potentially going to score more points than any other team. In this case, you’d much rather have the team with the 30% chance of scoring 180 points.
You can find more details about becoming a fantasy sports winner on this section of this website.
10. Bet on Sports
In the book How to Make $100,000 a Year Gambling, the authors suggest that a talented sports bettor can make more profit than any other kind of gambler. Of course, if you want to win on this side of the equation, you have to be able to win often enough to beat the vig. This means winning at least 52% or so of your bets—just to break even. Every percentage point you can increase your winning percentage by results in a higher ROI for you.
Let’s look at the math behind that for a minute:
You make 100 sports bets in a row, and you win 55% of them, betting $110 on every game. You win 55 X $100, or $5500. You lose 45 X $110, or $4950. Your profit is $5500 – $4950, or $550.
Most sports bettors measure their performance based on ROI (return on investment). You calculate that by dividing your winnings (or losses—you can have a negative ROI) by the amount of money you wagered.
In this case, with a 55% winning percentage, you profited $550 on an $11,000 investment. That’s a 5.5% ROI, which sounds small, but it’s actually not bad at all. Many people are happy to see that kind of return on an annual basis. In fact, you’re lucky to find a savings account that pays 1% per year these days.
One way to think of this ROI is as interest on your money. When you’re talking about interest, you can think about compound interest, which means that you’re making money based on the new total.
Here’s how that works:
You bet that $11,000 over the course of a month. Next month, you have $11,550 to bet, so now you bet $115.50 per game. Now you’re winning slightly more on your bets. (You don’t have to bet in multiples of $110, even though that’s what the ratio of your winnings is based on.) This month, you lose $5197.50. You win $5775. Your profit this month is $577.50.
The rule of 72 says that you can divide the interest rate you’re earning into 72 to find out how long it will take you to double your money. If you’re earning 5.5% on your money, you’ll double your money every 13.1 periods. So in a little over a year, your bankroll will increase to $22,000.
Now that you have a bankroll that’s twice the size of the previous year, your earnings will double, too. Now you’re profiting $1100 a month instead of $550.
And obviously, if you’re starting with a larger bankroll, you can see greater monthly earnings. Let’s say you’re able to put $110,000 into action every month instead of $11,000. You’re earning $5000 a month, which is enough to live on. And in a year, you can double that to $10,000 a month, which is a decent living by most standards.
But how do you get good enough to achieve a 55% win rate. After all, the handicappers who work for the sports books are experts. Their lines are going to be as close to accurate as you can imagine.
You can look for patterns to exploit, but these patterns don’t last forever. Think of sports betting as a marketplace. As the marketplace matures, it becomes more efficient. This means that yesterday’s betting systems won’t work today.
One tactic that seems to work well over time is called “fading the public”, or betting against the public.
How does this work?
You watch for changes in the line. When the line changes, it indicates that the general public is betting heavily in one direction. The sports books change the lines in order to stimulate action on the other side of the event. If the original line was correct, and it usually is, betting against the public is a positive EV move.
It’s always a good idea to bet against the general public, because the general public doesn’t really know what it’s doing it. So if the line is improving on one side, bet with where the line is improving.
Here’s an example:
The Cowboys are playing the Redskins, and the Cowboys are the favorites by 7 points. The bookmakers wind up with 70% of their action on the Cowboys and 30% of their action on the Redskins. They want to get more money on the Redskins.
So the bookmakers make the Cowboys a 7.5 point favorite instead. That movement of the line is a clue that you should bet on the Redskins. Often the line will have to move several times in order to get the money even on both sides. The sharps I know bet more every time the line moves. (A “sharp” is a knowledgeable sports bettor who wins more often than he loses.)
Fading the public is just one way of getting an edge in sports betting. Following the news more closely than your competitors is another way of getting an edge. If you can find out information that might affect the outcome of a game sooner than the general public, you can get an edge that way, too. The point spreads will adjust based on the new information, but you’ll have made your bet before that happened, giving you an edge.
Conclusion
Making a living as a gambler isn’t the easiest thing to do. It’s not nearly as glamorous or as exciting as you might think, either. But it is something you can pull off, especially if you’re willing to work hard for it.
The first steps you need to take are learning the math behind gambling and probability. Follow that up with developing the self-discipline to set and achieve your financial goals. Without those 2 factors in place, you won’t be able to succeed as a professional gambler.
Then you need to decide which approach to gambling for a living that you want to take. You’re not limited to the 10 suggestions on this page, either. You might be able to figure out other ways to get an edge. In fact, the only way you can make a profit in the long run is to figure out how to get a consistent mathematical edge. Once you’ve done that, it’s just a matter of being disciplined in your approach.
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