How I got into betting

How I got into sports betting

Already in my very early childhood I started reading all those tables, studying them, do the counting of goals, was excited about them, looked at results and developments. I could not do much about it and no one could really stop me from doing so. And why would they? But it was not the only thing that I started at this time with those tables and this kind of fascination.

I started to try and make a simulation of those football leagues. I tried a couple of things to slowly but surely get it closer and closer to the real tables and developments. I even started with a ranking system (at the age of 11) to give the better sides the better chances. Make it realistic. As realistic as can be. Home advantage, coal average, all those things needed to be taken care of.

When I got older and computers took over of course I instantly went over to this kind of „simulation“. I developed my first software for football in the early 80s at university. In the last version of it this software was already able to predict outcomes of the games in the sense of: determining probabilities.

This first version was nothing but result-based. The results were a little bit frustrating as I was expecting them to be a bit more „spot on“. But how could I have expected this, just basing it on past results?

The bridge to betting by the way was built alongside that. I heard from a friend (in 1982) that there is such thing as sports betting (before that in Germany all I knew of was Toto, which was kind of a silly game, or 6 out of 39, where you needed to hit six draws). I did not understand right away what they did there and how it all worked. But my studies of mathematics soon helped me out: I did understand it, but was not ready at all to start betting. How to determine the probabilities? But that was something that needed to be worked on.

Still I did some betting during the 1988 European Championship in Germany. I used an approach for that which was pretty simple, but still just based on observations, not clear-cut calculations. It was this that I observed a pretty huge difference between the goals scored in the first half and the goals scored in the second half. I was not sure yet if the odds one could find there were properly calculated, but there was another effect that I noticed — and also could not calculate properly yet: the underdog was usually overpriced, that was at least my impression. So these two things I could combine to some pretty good bets that produced me some winnings of like 2.000 DM, which was quite a fair amount for a novice. I still did not go on with this betting part, instead went on developing.

So this first attempt at university followed a second attempt and this second attempt followed a third attempt, the last one on my home PC already. I just went on developing and trying to improve on that. And in 1990 I all of a sudden had this breakthrough idea. First of all the formula was needed to determine the goal expectancies. That was a formula still applied today. It is pretty simple I have to say so it would not need to be „the big secret“, but still I do not tell it for now. Especially as it seems: no one did find this simple formula yet?! Amazing, funny. Or am I wrong?

Calculate the goal expectancies — taking into account the strengths of the teams, the goal average of the league, the home advantage of the teams and the home advantage of the league — is still in use. SO it does sound a bit more complex than I pretended? Well, of you think so? It really is simple and mathematically clean as well. Whereby here any mathematician might say: „Show me the algorithm or rather the function — only then can I judge whether or not it is clean.“ But this I can’t do for now. So you needed to trust me?! Let the results have the final say? Well, I think it is a combination of all of it.

From these goal expectancies we can move on to the simulation I used in the first place. And with this simulation we actually can work out all the probabilities for whatever market offers prices for. Even the long term betting would be covered if you repeatedly simulate all games of one competition.

Anyway this part was actually not the subject here. Still I get back to those algorithms and try to point out all the contexts there are again and again so it hopefully all makes a lot more sense altogether. The first program was ready for the World Cup 1990 in which all the functions needed and described above had been implemented — still with lots of stuff yet to be covered.

The World Cup in 1990 was a successful start of my betting career. I made a similar amount of money as during the 1988 European Championship, but this time it was a much more reliable result (in 1988 it had been too few bets and most likely a fair amount of luck in those) as there had been many more bets been made and also the „worst case“ happened with Germany winning the title. Market made them favorites, they won the competition, but there were many times things could have gone differently as well. E.g. semifinals when Glenn Hoddle hit the post or when Germany once again won on penalties?! It was a good start and the algorithms seemed to be working.

So the league everyday life began shortly after the World Cup. I had doing a regular job for a couple of years — in spite of this still ongoing gambling career playing some BlackJack and Backgammon — and thus quit my job to just focus on this new part of the gambling career: sports betting, focus on football.

The algorithms did work for the leagues as well or, let’s say: they even worked better. Although I could not know this from the start. It turned out to be that way… First of all it took some time to enter all the leagues, teams, schedules and so on. Then it took me some time to enter all the bookmakers prices of like ten or up to fifteen companies, from England and from Austria. I typed in all the prices and my software grew being able to work out the possible bets, all the ones that my software considered to have a value.

Actually there was another part of this early programming that was needed: how to determine the update factor? I come from a chess career as well, having played ten years in the German Bundesliga. There is the so called Elo-system they use to determine the strengths of the players. Although it is a simplified version of my predictions system („predicting“ probabilities is actually what this and that system both do more or less), it does comprise this one important detail that I had been already familiar with: you need to update the strengths of the players (thus teams in football) by their results. There is the so-called k factor in Elo-system, which drives the speed at which you want to react. This speed can well be optimized, although in chess (the Elo-system) it had never been really done. But: in that Elo-system they do not really try or not even have to determine those probabilities so exactly because no one would be betting on them (if they had to, they needed to be a lot more precise). In football or at betting market it is the only thing that matters: how quickly/slowly would you wish or would you have to react to make the predictions for upcoming fixtures as exact as possible? Anywhere to accomplish that I used an advanced so-to-say AI technology to determine the best possible update-factor. Whereby you can still find out later: the results can become even better if you do some manual adjustment here or there, based on team news or other observations that will justify that. But anyway a good setting for this update factor had been needed — and has been found.

So what I did then was this: create documents in which all the possible bets had been written, for every single bookmaker I recorded the prices for and for all the leagues that I introduced to my system (this was a growing number of course). And I sent out those documents via fax to every single company that I had in my database. I did this on Friday, pre-match, and I did the same thing on Monday. So they (and myself) could check all those paper bets and keep track of those results.

I did that for about half a year with the result, that I beat almost every bookmaker (maybe it was one that I ended up with a small minus) and the total record was like 5% plus. So this final result I sent out to every bookmaker as well, so they could see how I did at their company and how I did at the other companies.

Then I picked up my computer, sat into my car and drove to Austria and visited all those bookmakers. I showed them my program and explained what I did and how I did it. I asked every single one if he wants to fight against my prices or if he wants to get those prices and pay for it, because they are obviously better than their own prices. Most of them decided to fight, but one of them decided to use my services.

Anyway by introducing myself and showing hem what I did I was obviously allowed to bet at them. They knew what I was doing and they would be ready to take some large bets as well.

This is the other part of the story: I had a friend from my Backgammon times (that were still not over…) who believed in me and into this system and had some money, too. So he set up a betting budget of 25.000 DM just for betting purposes. I did not have this much money by that time, although I wasn’t poor. Obviously he set up the budget and we shared it, so I was holding half of it, although I did not need to invest it. That is a pretty fair deal I consider.

Anyway that was how it all began. I sent some money to the companies, I started doing the same thing that I did, but instead of doing it on paper, I did it with real money. The additional „system“ I applied and made use of and still promote is this one: system betting. It combines all the advantages that you have by combining your bets, but also the benefit of being less exposed to luck. This system by the way I explain elsewhere in this blog (why and how to and advantages of system betting).

The results were excellent for those next one and a half years. I sent all the bets to my partner, week in, week out, and showed him the balances and the total amounts won and everything, of course, but he never really tool part in this business. He had his own well-going business, so at some point I asked him, why we wouldn’t just split it up? He agreed. So I went to see him in his office with 100.000 DM in my pocket. I put these on his table, because it reflected what his share was, and he was happy. From then on I did this business on my own. Whereby obviously I found some other partners later that were more inside this business.