The Moose - a winning gambler

“The Moose” makes a minimum of $1 million a year, always take at least six weeks of annual holidays and looks ten years younger than his age. And he isn’t an investment banker.

This is an article by Joe Saumarez Smith that appeared in the January 2001 edition of Business Life, British Airway`s inflight magazine for business class travellers.

“The Moose” makes a minimum of $1 million a year, always take at least six weeks of annual holidays and looks ten years younger than his age. And he isn’t an investment banker.

His stellar rewards come from gambling – although he would claim that he takes no risks in his betting and that he would be more properly classified as a mathematician.

“The Moose” makes his cash from sports arbitrage. In the simplest terms, in a contest between two teams, he’ll bet on both sides and guarantee that whatever the result, he makes a profit. This is not a simple process. If England are playing Pakistan at cricket, he’ll be calling bookmakers in more than 50 countries to find out the best possible odds on each result is available.

So with England playing Australia in the Ashes cricket series this summer, he’ll be looking to bet England in Australia – where the Aussie loyalists couldn’t conceive that England will have a shout over the five game series – and Australia in England – where exactly the opposite will happen. But he’ll also be speaking to the bookies in Venezuela, Antigua, Costa Rica, Malta and whichever other territories have legalised gambling this week.

“The Moose” – he prefers to keep his real name away from the United States’ tax and anti-gambling authorities – knows that competition in the gambling industry has given the bettor a real chance of getting one over the bookies. Three years ago there were fewer than 20 online bookmakers around the world. Now there are more than 550 sportsbooks – and a couple of thousand more online casinos – for him to choose from. It only takes two of them to make a minor mistake on one event and he can leap in and guarantee a 2 or 3% return on his money, usually overnight.

This is the core of how he makes his money. But there are other more complex bets that better use his skills as a PhD mathematician.

The most profitable of these is exploiting “middles”. Without going too much into the mind-numbing mathematics of this, the concept works like this:

In the first game of last October’s baseball World Series “subway series” showdown between New York Yankees and the New York Mets, bookies around the world disagreed about how much of a favourite the Yankees should be. Some thought they should be only ½ run favourites while others – who had accepted large bets on the Yankees at long odds earlier in the year – thought they should be 1 ½ run favourites.

The bookies offer odds of 10/11 (bet 11 to win 10 and get your stake back) on each side. Those who play the “middle” bet the Yankees with a ½ run handicap and the Mets with a 1 ½ run start. If the Yankees won by one run they would collect on both bets.

The mathematicians calculated there was around a 16% chance of this occurring. But the bookies’ odds mean that the bettors were taking odds that suggested there was only a 5% chance of it occurring. The Yankees won 4-3 in a twelve innings thriller and those playing the middle collected. When you play the middle on hundreds of games a week and only need to collect on one in nineteen, the profits soon start to add up. On average, they expect to collect on roughly one game in every eleven.

So, is there any reason why you shouldn’t get off this flight and start a new life as a professional gambler doing the same thing? Unfortunately (or probably in the eyes of your friends and partner, fortunately), it’s not as easy as it first appears.

The first problem is actually placing the bets. Bookies don’t like gamblers who win and have an irritating habit of closing their accounts. “The Moose” bets through a series of friends and pseudonyms that would put a money-launderer to shame. It’s a network that is built on trust and has taken a long time to establish and isn’t easy to replicate.

Second, collecting the money is not guaranteed. Some of the less legitimate bookmakers around the world – those not licensed in first-world jurisdictions – have been known to refuse payment of winnings. For those with connections in the gambling industry, subtle pressure can be applied to liquidate these funds. For your average punter sitting at home, the risk element of not being able to pick up your hard-earned profits should be enough to make you think again.

And the third reason is that professional gambling of the sort practised by The Moose is extremely boring. Sure he gets to take a lot of holidays but the rest of his life is spent 18 hours a day in front of a bank of computer screens and on the telephone to the bookmakers’ offices. If you’re thinking James Bond in his dinner jacket, try sweatpants,T-shirts and empty pizza boxes instead. He doesn’t even get to watch the games he has bet on because he’s too busy looking for new wagering opportunities. And as for his love life, professional gambler is not the box most women tick on the dating agency forms. Potential partners tend to concentrate on reforming The Moose; unfortunately for them, it would be harder to make the Pope convert to Judaism.

Bookies accept that arbitrageurs will always exist. They think of them as leeches, sucking off a couple of percentage points of profits that would otherwise build an extension for their Florida beach house. The people who do it are smart enough to make a good living in almost any profession – frequently they have started their lives as lawyers or accountants – but choose to a less conventional life style. In the battle with the bookies there is though only one winner - as they say in the sportsbooks of Las Vegas, “it’s a tough way to make an easy living”.

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