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armoedisussiopros.netlify.com › Sports Investing Strategies ▄ ▄
Sports Investing Strategies Average ratng: 3,6/5 4503 votes
 1. Examples Of Investment Strategies
 2. Sports Investing Strategies Without
 3. Sports Investing Strategies Pdf

That said, you can invest in sports in myriad ways. Bankrate looks at various
sports investments, from owning a minor league team to investing in
sports-related stocks to owning a health club. Investing $10,000 into the stock
market for a year and earning a 10% return is considered a great investment –
but your return winning a modest 54% of your sports bets would trounce that
return. My picks have yielded a much higher risk adjusted return than the stock
market. Obviously, the variance from season to season is formidable, but as.
Barstool Sports Founder and President Dave Portnoy recently revealed what he’s
lost and gained while day trading. In a FOX Business Town Hall Wednesday,
Portnoy told “ Making Money with. Barstool sports founder dave portnoy returns
after coronavirus scare Portnoy said his investment strategy relies on momentum,
strong stocks and ignoring the “doom and gloom” that some networks. Today, we
will look at the pros and cons of investing in big-time sports. The Pros In
economics, demand (or 'final demand') is defined as the ability and the desire
to purchase goods and services.

Sapphire Sport's Michael Spirito discusses the Silicon Valley-based venture
fund’s investment thesis, why it backed mobile video startup Buzzer, and how
sports tech has changed during the coronavirus pandemic. By Michael LongPosted:
February 9 2021

Speak to any self-respecting venture capitalist and they’ll likely talk up the
importance not of investing in a particular product or service, but the people
behind it.

Conventional wisdom within the investment community says that establishing trust
in an entrepreneur or founding team is a critical part of the due diligence
process, perhaps even more critical than determining the future potential of a
company’s solution or business plan. At a time of restricted personal
interaction and economic upheaval, however, the process of building much-needed
rapport between individuals has only grown more challenging.

Nevertheless, startup investors and founders have found ways to connect and do
business during the coronavirus pandemic. In recent months, major funding rounds
announced by startups of all kinds have clearly shown that business is booming
in the burgeoning sports tech sector, and there have been few signs that the
onset of Covid-19 has had any discernible impact on investor appetite
whatsoever.

 * Sports Tech Investment Week A SportsPro special series

One investment company that has remained notably active throughout the pandemic
is Silicon Valley-based Sapphire Sport, a US$115 million venture capital fund
which was launched by Sapphire Ventures in early 2019 to invest in early-stage
technology companies at the intersection of sport, media and entertainment.

Backed by an investor group comprising no fewer than 24 limited partners whose
businesses span the full gamut of the sports media industry, Sapphire Sport's
financiers include everyone from heavyweight rights holders such as Major League
Baseball (MLB) and City Football Group (CFG), to major brands and organisations
like AEG, SAP, Sinclair Broadcast Group and Adidas.

Upon launch, the fund boasted an investment portfolio of five sports-related
startups, including at-home fitness system Tonal - which recently raised US$110
million amid surging interest in connected fitness - and the ultra-successful
digital network Overtime. In the months since the Covid-19 outbreak, it has
injected further capital into at least two more companies: Buzzer and GreenPark
Sports, both of whom feature on SportsPro’s latest list of sports tech ideas to
invest in now.

Shortly after those deals were announced, SportsPro sat down for a virtual chat
with Michael Spirito (left), a founding partner at Sapphire Sport and former
21st Century Fox executive, to find out more about the fund’s approach to sports
tech investments and how it has been able to navigate the pandemic.


GENERALLY SPEAKING, WHAT HAS BEEN THE IMPACT OF THE PANDEMIC ON THE SPORTS TECH
SPACE? HAS IT OPENED UP NEW OPPORTUNITIES TO INVEST, PERHAPS BROUGHT NEW
COMPANIES AND SOLUTIONS TO THE FORE THAT WERE PREVIOUSLY FLYING UNDER THE RADAR?

Just to rewind the movie a little bit to when and how we launched the fund about
two years ago. We’re the early-stage fund at Sapphire, we’re a first-of-its-kind
fund. We’re investing in the future of consumption and the technologies that are
helping drive consumption paradigms and consumption business models now and into
the future.

The trends that we were already witnessing in consumption, and quite frankly
that we were investing against, going back a couple of years have only been
magnified, intensified and accelerated [by the pandemic]. We’re looking at what
products are out there or being contemplated or launched, what entrepreneurs are
out there building products that will help drive better and more efficient forms
of consumption.

The other bucket we look at is the stakeholder world: teams, leagues, athletes,
media rights holders, brands, sponsors, merchandisers, retailers, etc. Every
part of that world is involved in the consumption ecosystem, and all they’re
trying to do is better their linkage to the end user, the fan, the consumer,
whoever it might be.

These industries have been fairly slow to evolve and createhttps:>


HOW HAS THE PANDEMIC AFFECTED THE WAY IN WHICH YOU, AS AN INVESTOR, GO ABOUT THE
BUSINESS OF MEETING ENTREPRENEURS, UNDERSTANDING THE CONCEPT, AND ULTIMATELY
DOING THE NECESSARY DUE DILIGENCE?

It’s a great question and, quite frankly, the best and most poignant question
you can ask somebody in my position, as an investor, in this incredibly unique
period of time. We’ve never seen a period of time like this. Any other period of
market disruption - whether it was 2001, 2008/09 - you could still see people in
person. There’s nothing you could do to prepare yourself for a period of time in
which personal interaction basically gets shut down for an indefinite period.

I’ll speak on behalf of Sapphire and as part of the venture investing community
in Silicon Valley and beyond, and how we think about the process of getting to
know an entrepreneur, getting comfortable with a founding team and an idea, and
what the steps are toward making an investment.

It requires a different way of thinking about it and the ability to get
comfortable over a video call.

We’ve actually done three new investments over the past several months, the
first of which was Buzzer. Bo is somebody that I knew previously. We actually
started to put the deal together at the NBA All-Star Game in Chicago in
mid-February, one of the last events that we were all at. We started to put
together what that would be right before Covid.

Since then it’s been interesting and challenging to get to know entrepreneurs
over Zoom. In some cases, I’ve been able to go on socially-distant walks and
coffees with entrepreneurs when the opportunity has presented itself. We, again,
have gotten to the point where we’re in the process of closing an investment in
companies and with founders that we actually have not met in person, so it
requires a different way of thinking about it and the ability to get comfortable
over a video call.

You do the same type of diligence, you do all the similar types of checks and
balances and customer calls before you make an investment, but you really have
to cross that threshold on the personal relationship basis in this environment.

Just like every venture investor who has negotiated, done diligence and closed a
deal with an entrepreneur they actually haven’t met in person, we’re not going
to know what that is going to yield until years down the road. But in the cases
where we have made that investment without meeting in person, we’ve just made
the adjustment and gotten as comfortable as we possibly can.

 * ‘It’s thoroughly complex’: How City Football Group is redefining soccer club
   ownership


EVEN IF THEY ARE ALL SEEKING NEW WAYS OF DRIVING CONSUMPTION, HOW DO YOU ENSURE
ANY INVESTMENTS YOU MAKE ALIGN WITH THE DIFFERING INTERESTS AND EXPECTATIONS OF
YOUR VARIOUS LIMITED PARTNERS?

Each vertical within the industry, from a stakeholder perspective, is
represented in the fund - that’s why it’s a first-of-its-kind fund. Each of
them, in their own way, is trying to build a better connection to their end
consumer, and it’s through technology, it’s through digital product. We, as a
Silicon Valley-based investment firm, are doing that - that is what our stated
goal is.

When we look at where the opportunities are for investment, we’re looking at
where the big marketplaces are within that - digital health and fitness, gaming
and esports, digital and next-generation media - and then the enterprise and
infrastructure that runs all of that. That’s where we think the biggest
potential drivers of value from a venture investment perspective are, and that
benefits everyone within our LP group.

At the end of the day, our LPs are financial investors; they are investing in a
venture fund, such as Sapphire, toward long-term financial benefit. But we have
the unique vantage point to look at these worlds in which we’re investing, where
the use cases are, through these LPs and their lens. If they’re all trying to
solve the same goal, even if they’re operating in a different part of that
realm, [there is] a unifying theme.


FINALLY, WHAT IS THE MOST OVERHYPED SPORTS TECH TREND OR PRODUCT HEADING INTO
2021?

I would say it’s more interesting and more resonant as digital products that
better link the brand or the entity to the consumer are being thought about, but
if AR/VR doesn’t happen now, it’s not going to happen. There’s never been a
better tailwind for that part of the industry. It was over-invested about two or
three years ago and subsequently became under-invested over the past 12 to 18
months.

To me, I’m still yet to see the consumer adoption or the use cases around great
AR/VR products, so it’s an area where our tentativeness towards investment
probably hasn’t changed. We’re still tentative about what that industry might
bring to bear.

This interview forms part of SportsPro's Sports Tech Investment Week. Read more
here.


MAKING MONEY BY BETTING ON SPORTS

Most people think that sports betting is about finding ‘sure things,’ but in
reality such ‘locks’ are nothing more than gamblers’ fancy. Just as in real
estate, currency, stocks, or any other speculative market, ‘sure things’ simply
do not exist. As a professional sports bettor, my goal is to find and exploit
many small edges over a long period of time to earn a compounding return.
Winning 55% of games is very significant, and with very conservative bet sizing,
you can grow your return very quickly. Investing $10,000 into the stock market
for a year and earning a 10% return is considered a great investment – but your
return winning a modest 54% of your sports bets would trounce that return.

My picks have yielded a much higher risk adjusted return than the stock market.
Obviously, the variance from season to season is formidable, but as anyone who
had a significant amount invested in stocks or real estate in 2008 can tell you,
such swings aren’t limited to sports. In the long run, my edge in what I do is
far greater than the edge that you could hope to gain in any other speculative
market.


JUICE, AND THE POWER OF 55%

Even though most sports bettors are losers in their own right (as a whole,
bettors actually win an average of only 48% of their bets – less than they would
expect to win if they just flipped a coin for every game), their losses are
compounded by the fact that the house takes a cut of winnings, also known as the
‘juice’ or ‘vig.’ Most sports books charge a 10% commission on wins, which means
that a bettor must actually win 52.4% of his games just to break even. (Wagering
$100 per game, a bettor loses $100 with a loss and wins $90.91 with a win, so he
must go 11-10 (11/21 = 52.38%) to break even).

In order to beat the juice and win in sports betting, a bettor must employ a
disciplined approach in their analysis of each game using methods that have
proven to be successful in the long run. I discuss my math models and analytical
metrics in my Handicapping Methods essay, but you must realize that only the
best and most knowledgeable handicappers can win more than 52.4% of their games.
In their 2007 two page article about my handicapping success, the Wall Street
Journal wrote, “…fewer than 100 people can sustain (win rates of 55%) over time.
Most of them belong to professional betting syndicates that hire teams of
statisticians, wager millions every week and keep their operations secret.”

Touts often claim to be able to hit 60% or higher, but as I explain in my essay
on Bayesian Probability, anyone who tells you that their long term expected
winning percentage is higher than 60% is deluding themselves. Ten or more years
ago a sharp handicapper could win about 60% long term but those days are over,
as odds makers have become more savvy in the past decade or so. For a bettor to
claim a greater than 60% long term expected win percentage, that would be mean
that Vegas would have to consistently release lines with egregious errors, and
that simply just does not happen often enough nowadays for claims of a greater
than 60% long term expected win percentage. Any short term win rates of around
60% or higher are simply due to blind, short-term luck. For instance, last year
(2016) in the first season using a new NFL play-by-play model, Dr. Bob Sports’
NFL Best Bet sides were an incredible 66-26 (71.7%), but that record was
enhanced by winning a very large percentage of close games (31-12 on Best Bets
decided by 7 points or less) rather than splitting the close ones. It still
would have been a great season on NFL Best Bet sides (62%) if the close games
had been 50% but I still can’t expect the new model to win 60%-plus on sides
based on that one season – although the play-by-play model back-tested at a very
profitable 56% winners.

I often hear amateur gamblers erroneously claim that winning 55% of games isn’t
even enough to beat juice. As demonstrated above, a bettor only needs to win
52.4% to break even, and a 55% bettor will be very profitable in the long run if
they pursue an optimal money management strategy.

Of course, as in any game of chance, there is variability in the actual results
and just because you have won 55% in the past and expect to win 55% in the
future doesn’t mean that you’re going to win 55% this upcoming season. There is
variance in sports betting, as there is in most investments, and I calculate the
standard deviation to figure out how much of my bankroll I can safely wager on
each game during the season to accommodate potential negative swings while
having very little chance of exhausting my bankroll. I have extensively
quantified the variance that exists in sports betting, and use mathematical
formulas to dictate the exact optimal amount to invest so as to maximize the
ratio of profits to variance.

My long term percentage on College Football Best Bets is 56% (1290-1017-40 over
29 years) and the new NFL play-by play model was 100-69 (59.2%) in 2016.
However, despite being a combined 148-107 (58.0%) on Football Best Bets, college
and NFL, in 2016, I will continue to use 55% winners as a realistic goal going
forward. If I expect 55% on 200 Football Best Bets (I had 255 last year, which
was higher than expected) then the expected profit at -110 odds would be 200 x
(0.55 – (1.1 x 0.45), which is +11.0 units (or +22.0 Stars if my average Best
Bet is rated 2-Stars). The Kelly Criterion recommends a wager of 3.4% of your
bankroll for a wager with a 55% chance of winning and odds of -110. However, the
Kelly formula assumes sequential betting and sports betting usually involves
simultaneous betting, which is part of the reason behind using some fraction of
full Kelly to reduce risk. If I play 2.0% of my initial bankroll per bet, or
1.0% per Star, (i.e. flat betting) then my expected return during football
season (5 months) is 22.0%. Adjusting your bankroll after each week rather than
flat betting will increase your expected return, as explained in the KC
simulation section of my money management section.

A basketball season with 53.5% winners (my career percentage is 53.9%) on 500
bets would on average yield +11.75 units ( (500*.535) – (500*.465)*1.1 ), or
+23.5 Stars if my average Best Bet is rated 2-Stars. Using a conservative 1.6%
of bankroll per bet (full Kelly at 53.5% at -110 odds is 2.35% of bankroll), or
0.8% per Star, results in an expected return of 18.8%. So, despite a lower
overall winning percentage and smaller average wager size, a season’s worth of
basketball wagers is fairly comparable to a season of football because there are
so many more Best Bets in basketball season.


EXAMPLES OF INVESTMENT STRATEGIES

The NBA Guru Basketball service has achieved even higher returns in the 5
seasons that the Guru has been with Dr Bob Sports. The NBA Guru has an
incredible record of 647-532-20 (54.9%) on his Best Bets over 5 seasons and
1366-1118-41 on a Star Basis for +136.0 Stars (with an extra -0.2 for added
juice), which is an average of +27.2 Stars per season. You can risk more of your
bankroll per play with the NBA Guru because he has a higher win percentage and
fewer plays. I recommend 2.0% of your bankroll per play, or 1.0% per Star on NBA
Guru Best Bets.


MONEY MANAGEMENT

Money Management is as critical to a sports investor as picking winners. I have
devoted many hours of careful analysis and math to optimal money management
systems, which I have painstakingly outlined in my Money Management articles.
Sports betting is more high risk (higher volatility and standard deviation of
return) than stocks, but also results in a higher return if you follow a proven
long term winning handicapper (of which there are very few).

My Money Management articles outline how to adjust your bet sizing based on your
goals (expected return vs. probability of positive returns), your investment
length (one season or many), your growth preference (flat or compounding), your
risk tolerance (high or low) and the proportion of your overall bankroll which
is made up by sports betting.

It is always better to set conservative expectations to avoid over betting.


FACTORING IN THE COST OF MY SERVICE

The cost of my College football service is $895, the cost of the NFL service is
$995 ($1,595 for both services), my Basketball service is $895 ($2,195 for all
Football and Dr. Bob’s Basketball service), and the NBA Guru subscription is
well worth the $1495 given how profitable he’s been ($3,295 for all Football and
all Basketball, including the NBA Guru). You must factor in that cost when
calculating your expected return on investment (ROI). As explained above,
winning 55% on the Football Best Bets and 53.5% on my Basketball Best Bets would
yield an expected profit of +45.5 Stars and let’s assume the NBA Guru profits
+27.2 Stars as well (he’s averaged +27.2 Stars per season). Let’s say you decide
to play 1.0% of your initial bankroll per star on the Football Best Bets and NBA
Guru Best Bets and 0.8% per star on the Basketball Best Bets, as in the example
above. Doing so would have an expected total return 68.0% per year based on
flat-betting using your initial bankroll. Using an optimal betting strategy, as
explained in the advanced money management section, would yield even higher long
term returns while protecting the downside risk in the inevitable negative
variance seasons that plague even the best long term handicappers.

If you had $20,000 that you could comfortably afford to risk as your sports
wagering bankroll and $3,295 went to pay for the all Football and all Basketball
service, then you would have $16,705 left for wagering. As explained above the
expected return on the combined Dr Bob Football and Basketball and NBA Guru
Basketball services is +68.0% per year (using a less optimal flat betting
approach), which would result in a return wagering profit of +$11,359 on the
$16,705 initial bankroll. The overall profit, after factoring in the cost of the
services, would be $8,064 (($16,705 x 0.68) – $3,295 = +$8,064), which is a very
good 40.3% expected return on your $20,000. That percentage return is higher for
higher bankrolls and lower for lower bankrolls since the cost of service becomes
a smaller percentage of higher bankrolls and a higher percentage of smaller
bankrolls. If you want to subscribe to the all Football and all Basketball
package you would need a total of at least $4,846 to invest to expect a positive
return after factoring in the cost of the service. The calculations above are
based on expected results based on long term records and some years are better
and some years are worse.


SPORTS INVESTING STRATEGIES WITHOUT


WHAT IS A POINT SPREAD?

Before I delve into rigorous explanations of how a bettor can gain an advantage
against the point spread, it is important to understand what the spread actually
represents. Point spreads were invented to keep bettors interested in games
between teams of different talent levels – if a perennial powerhouse like
Alabama plays a mid level team such as South Alabama, you’ll find very few
people willing to bet on which team will win the game since Bama would be such a
prohibitive favorite. However, most are willing to bet on whether Alabama will
‘cover the point spread’ and win by a certain number of points. If the point
spread is 21.5, then the Crimson Tide must win by 22 or more points for their
side of the bet to cover, while South Alabama must either win outright or lose
by 21 points or less to cover their side. Point spreads are designed so that the
probability of each outcome is roughly equal, and are generally set so as to
approximate the median score differential between the two teams at the given
site of the game.

However, skewed public perception, results-oriented analysis, and unsound
metrics result in point spreads that are often biased one way or another. While
the casual bettor does not possess the capacity to exploit these advantages, I
have used mathematical models, situational analysis, significant trends and
quantitative player analysis that are far more complex and accurate than
anything else on the market to gain an advantage, which is why I have won 53% to
56% of my Best Bets (depending on the sport) over the last 29 years.


HOW ARE THE LINES SET?

While the odds makers do to try approximate the median margin of victory between
two teams, they also try to reduce their exposure to risk by setting lines such
that the public money will fall evenly on both sides of a game, so that they can
offset the bets against each other and earn a profit on the juice (cut of
winnings taken by the house, explained below) without exposing themselves to
large potential losses. Thus, odds makers are often in the business of gauging
public perception rather than team performance, and therefore the betting public
actually sets the line. In more recent years, the betting public has had less
influence on the odds than professional betting syndicates or sharp money has
had, but there is still value to be found – although in different ways than in
previous decades. If Georgia is 4 points better than Georgia Tech according to
my advanced metrics and analysis, but the aggregate public perception is that
Georgia is 7 points better than Georgia Tech, then the posted point spread is
likely to be closer to 6 or 7 points (public perception) than it will be to 4
points (the realistic difference between the teams). This makes my job as a
professional handicapper much less daunting; not only can I exploit lines where
the odds makers are off, but I can also exploit the uniformed opinions of the
general betting public, and more recently take advantage of betting syndicates
and ‘quants’ that rely more and more on algorithms but can overlook some of the
hidden value in changes in team personnel or lineups and in the particular match
up between two teams.


ISN’T GAMBLING RISKY?

I don’t believe that the term ‘gambling’ applies to what I do. I sell
information to subscribers, with which they can take positive expectation
positions in uncertain markets. With correct financial optimization and bankroll
management, long term risks are nominal compared to the risks of investing in
other, more conventional markets. Just as a single stock may go up or down in a
day, any one team may win or lose a given game. But as long as the investor
maintains a long-term perspective, understands variance, and doesn’t over-extend
themselves or bet more than they can easily handle, risk can be highly
mitigated, and they can earn a very attractive risk adjusted return.


SPORTS INVESTING STRATEGIES PDF

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