How Is Sports Betting Like Trading? Part 2

Sports betting tends to be lumped under the general umbrella of gambling which includes casino games.  This is an understandable comparison, and it’s a pretty accurate one.  Sports betting arguably has aspects in common not only with games like poker that require skill, but games like roulette as well where a fluke can determine the outcome.

But I would argue that sports betting also belongs under the same umbrella as various forms of trading like stocks, CFDs, binary options, and Forex.  In How Is Sports Betting Like Trading? Part 1, I talked about some of the general similarities between sports betting and trading.  At their core, both can be complete blind gambles—or they can generate profits which are so consistent you can earn a living from them.  What makes the difference is you.

Now, I want to briefly highlight a few more specific similarities between trading and sports betting:

• Both are situations where you are up against a global marketplace, and your goal is to make a proper valuation where others go wrong.  That’s true with stock trading, Forex trading, or any other kind of trading, and it is true with sports betting as well.  Only in this case, your “portfolio” consists of the teams and players you are wagering on.

• You need the same three key ingredients to succeed at sports betting as you do to succeed at trading.  You have to have a money management plan, you need a strategy, and you need to have the right psychology.  If any of these three elements is missing, you will not make it.  On top of that, the actual rules that you need to excel are quite similar in both cases.  If you know how to manage money (or yourself) as a trader, you know how to do it as a sports punter, and vice versa.

• These are both opportunities to make a living on your own terms—if you are really good at what you do.  Most people will fail at both.  For some reason, though, the average person’s mental image of a sports bettor is of a working class guy in a sweatshirt at the pub who is burning through his cash with bad bets.  The average mental image of a stock trader is some guy in a suit on Wall Street rolling in millions.  In reality, most bettors and traders fit the former image, not the latter—but if you get really good at either, you can be the one rolling in the dough.

Sports betting and trading are two similar industries with similar mechanics.  Both are markets of valuation.  If you are the one who chooses the truly valuable assets and invests in them, you are the one who will emerge as the winner time and again.  In both cases, if you gamble blindly, you will lose.  But if you have a focus on strategy and you are willing to put in the work, you can actually earn a living.