Today, we will be taking a deep look at what is considered to be a good ROI in sports betting.
ROI is a financial acronym which means RETURN ON INVESTMENT; simply calculated by deducting the net profit from the cost of investment.
“A high ROI means the investment’s gains compare favourably to its cost. As a performance measure, ROI is used to evaluate the efficiency of an investment or to compare the efficiencies of several different investments” – Wikipedia
How does this correlate to sports betting?
We all know the gains of staking on football odds is to make profit from winnings. Although, some punters bet for the fun of it. Some have deduced strategies from professional tipsters to ensure they make more profits than losses in a particular period of time. Hence, seeing sports betting as an additional means of making a living. Strategies/tips on how this can be achieved can be seen on Tips180’s website.
If you’re looking to generate profits from a stake on this match, let’s create some fictitious odds and see how ROI calculations play out:
Man City to win: 1.75
Draw: 4.50
Real Madrid to win: 4.40
Now, let’s perform several ROI calculations based on a number of betting scenarios
Bet #1: If you place a $100 stake on City to win the match against Madrid, your return is as follow:
$100 stake x 1.75 odds = $175. Subtract $100 initial stake = $75profit.
Bet #2: If you place a $100 stake on Madrid to win the match against City, your return is as follow:
$100 stake x 4.40 odds = $440. Subtract $100 initial stake = $340 profit.
Bet #3: If you place a $100 stake on a draw between City and Madrid, your return is as follow:
$100 stake x 4.50odds = $450. Subtract $100 initial bet = $350 profit.
In each scenario, you can see that your $100 stake can provide different options, depending on the outcome of the match. Your ROI in each scenario is the profit made.
What is considered a decent ROI in sports betting?
An amount considered a good ROI in sports betting depends on the time frame you take into consideration.
Looking at it from the annual perspective, anything over 5% from approximately 3,000 bets is considered a high ROI which ultimately makes you one of the top sports bettors in the world.
The 5% we are talking about can often mean a different number for anyone’s wallet as it all depends on the initial investment.
Think of this like a business. For 90% of the companies in the world, regardless of the industry, 10% return on investment (ROI) is a great result. 5% is also a good result. If you invest some money in a mutual fund, 10% is considered an excellent return. It should be no different with regards to your sports betting.
Think of your betting as a business entity in itself. You are the investor; we are the mediator/counsellor and we are responsible for the results this entity produces. When setting your betting plan and goals for the next season, would you be happy with a 10% ROI? You absolutely should be, as most other business owners. Keep reading to see an example of what I mean with actual numbers.
It is delusional for sports bettors to think that 10% return is nothing and to always expect winning much more. After all, this seems very easy, right? You sit in front of your laptop, or pick out your smartphone, and in the space of minutes you can make numerous sports bets on various events. You’ve researched them, feel confident about them, and tell yourself that if you don’t win all of them, you absolutely have to win at least 3 out of 4.
Wrong!
Of course, I’m not saying you can’t win 3 out of 4 or all four bets. That’s what we are striving towards. But under no circumstances should you expect a 100% certainty. It’s called a bet for a reason after all, regardless of the fact you’ve put your decent research into it.
You can win, or you can lose. You should be prepared for both outcomes. Things usually even out after a sufficient sample of bets, and if you find yourself at 5% profit, hey – well done! Instead of feeling sorry that you “should have achieved more”, give yourself a pat on the back and appreciate that what you are doing is bringing you money.
Your business is profitable. So, stick to your strategy, be consistent, and keep making similar types of bets. Chances are that in the long term your ROI will be around the same figures.
You can see some of our betting bankroll plans here!
Profit accumulates over time
Imagine that you manage to hit 5% ROI most weeks and each of your sports bets is made with a similar stake which is predefined as a percentage of your bankroll. The power of the compound interest can do wonders for you.
If your starting betting bankroll is $200 during the first week, a 5% ROI would leave you with $210 at the end of the week. Now I hear what most of you are saying: “I’ve spent the whole week betting just for $10 profit.”
That’s correct, but after you hit 5% ROI the next week again, you will have $220.5. After the third week you’ll have $231.5. After the third month – just under $360. In one year – $2,528.
Not so bad now, is it? A nice chunk of additional income from sports exercising patience and staying disciplined.
What if you manage to nick a ROI of 10% every month? That will leave you with $28,408 at the end of the year.
What if your initial budget allowed you to start with a cumulative sports betting stake of more than $200 in the first week?
The $10 profit after the first week now doesn’t look so small when you follow your plan long-term, does it?
These calculations, of course, are for illustrative purposes only and don’t account for the fact that in some days, weeks or months you are going to lose money. That’s normal, it happens to everyone. But in other days, weeks or months you will be on a winning streak and can finish with a 25% ROI for the period. That is why in the example above I’ve used an average ROI of 5% for the whole period.
Patience pays off.
People often seek results in the short term. Once they don’t get what they want, they quickly become discouraged and fail achieving their goals. The solution is to trust the process and be patient. Good things happen to those who are patient. That’s applicable in all aspects of life.