SBC News Voice of the Sports Betting Industry
In Sportradar’s latest blog, SVP Managed Trading Services Darren Small discusses how the firm’s next generation trading and risk-management tools can be used to optimise sportsbook operations in time for August’s big kick off.
The Premier League season came to a close just over two weeks ago, but before the dust has had a chance to settle on Manchester City’s title victory, the League has announced the fixtures for the upcoming 2023 / 24 campaign.
With little more than two months to go until the big kick-off, the reaction amongst the fans to the announcement on social media provides a sharp reminder of the enduring popularity of soccer and its importance to the betting industry.
Soccer remains the biggest betting sport worldwide. We accepted more than one billion betting tickets through our Managed Trading Services (MTS) on behalf of our clients for this season’s Premier League, with a similarly high amount accepted for the UEFA Champions League, as well. And while those tent pole competitions are all wrapped up, for now at least, there’s plenty of soccer to be played worldwide over the course of the summer to provide ongoing entertainment and engagement opportunities for fans.
With coverage of more than 25,000 matches per month, soccer is one of the more voluminous sports we offer to clients. In the past, managing the trading and risk associated with this number of matches was a cumbersome and laborious task, but advances in the use of artificial intelligence (AI) are helping to drive more effective and efficient processes in this area.
AI underpins ALPHA Odds, our new odds re-calculation tool that will manage operators’ betting prices automatically in real-time. The fast-paced nature of a sporting event makes it difficult for operators to manually monitor industry price movements and adjust their odds to effectively reflect their liability and any associated risk, which necessitated a new solution.
Starting this season, with ALPHA Odds as part of a sportsbook set-up, operators will be able to generate bespoke betting prices in line with their risk exposure and liabilities, while also reducing volatility and improving efficiency, rather than the general industry prices.
An extension of Sportradar’s Managed Trading Services (MTS), ALPHA Odds re-calculates a sportsbook’s financial exposure after each bet is placed. Using a combination of historical match data analysis, real-time bet monitoring and predictive liability techniques, the algorithms within the solution are constantly adjusting probabilities based on an operator’s liability situation.
Betting transactions that would increase liabilities are automatically lowered, whereas odds that decrease liabilities are raised. This approach allows operators to be more efficient with their trading, stabilising any unforeseen market volatility with the aim of ensuring a better-balanced sportsbook.
More and more of our clients are already using ALPHA Odds across their in-play soccer offerings, with tennis and basketball following soon. Analysis of the effect it has had on over 17 million bets shows a positive impact on margin performance and a P/L uplift of approximately 6%, which is significant.
The solution is now also available across the company’s full soccer offering including its portfolio of pre-match as well as in-play markets, and pre-match is showing even more impressive results, with Tennis and then Basketball following soon.
Where we are with ALPHA Odds now is just the tip of the iceberg. With the depth of data at our disposal, we will be in a position where we’re able to offer betting odds tailored to individual customers. This form of AI risk management leads to possibly the most granular use of risk management tools to achieve the sportsbook’s desired ‘risk / return’ profile, establishing the ultimate goals of lower volatility and a stronger trading efficiency, meaning our sportsbook partners can confidently and accurately position themselves in their marketplace.
