- Failure to Exercise Proper Money Management – If a sports investor does not adhere to a sound money management system, he will ultimately lose his bankroll and suffer financial loss. No matter the investment (stock market, savings account, sports investing, etc.), one has to develop and implement a strategy that can procure a realistic financial objective. In the gambling world, sports bettors frequently ‘chase’ losses and ‘double-up’ in an effort to win back their losses. However, this strategy often times results in financial ruin as it fails to adhere to a sound money management system;
- Chasing the Hot Handicapper– After spending countless hours on the various sports handicapping websites on the internet, I have reached the conclusion that most sports bettors are engaged in an endless chase of the hot handicapper. In other words, a sports gambler will find a handicapper who is enjoying a prolonged win streak and immediately jump on that particular handicapper’s bandwagon. However, once the handicapper begins to lose, as the laws of probability dictate, the sports gambler once again begins his eternal search for the ‘hot’ handicapper. I also refer to this phenomenon as ‘cherry picking’ sports handicappers, and it is a strategy that will undoubtedly result in financial and emotional devastation;
- Unrealistic Expectations – After nearly five years in the sports handicapping industry, I have learned that most sports bettors have unrealistic expectations when it comes to investing on sports. Despite achieving an annual Rate of Return exceeding 60% over the last three years, I have lost clients because of losing streaks. The average gambler does not maintain a long-term perspective when it involves betting on sports, which is a critical attribute of being a successful sports investor. And, following a slight downturn in the betting marketplace, the typical gambler will revert to behavior #2 above;
- Volume, Volume, Volume – The average sports bettor enjoys a lot of ‘action,’ which is one of the biggest mistakes a gambler can make as it exposes one’s bankroll to an unwarranted level of risk. Rather than investing on the 1-3 games that provide the sports bettor with the best probability of success on that particular day, the typical gambler will continue to wager on sporting events regardless of the odds, especially if the games are televised. Unfortunately, the need for ‘action’ trumps the gambler’s need to protect and preserve his bankroll. And, then the gambler experiences losses early in the day, he will violate rule #1 above, while emulating the behavior described in #2 above.
This is a living and breathing document so I’m sure many of you will share other common mistakes made by the sports bettor. In the meantime, avoid the three behaviors above and increase your probability of becoming a profitable sports investor.