How do bookmakers establish odds if sports events are unpredictable, considering the multitude of factors at play that prevent precise probability estimation?
In: Mathematics
For one, there are a lot of sportsbooks out there that they can scrape lines for to ensure they aren’t getting too many bets on one side.
More foundationally their entire business revolves around creating odds that ensure profit. It’s why for a 50/50 fights the odds will be something like -105 at minimum for both fighters. If they receive too much action on one side, they will adjust odds to balance the other side.
If you are talking about brand new lines being created, they are definitely taking a lot of risk and that’s why odds can change hugely as d-day approaches for the event.
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