Supply, Demand and Betting Line Movements.
Most people understand the principles of supply and demand. If a product is in short supply its price will generally rise, conversely if a product is in abundant supply its price will generally fall. The world is full of examples, the controlled supply of diamonds keeps their price high; after a bad storm timber prices often fall due to the sudden volume that hits the market. It is the same in betting.
Let's take an NFL example of the Indianapolis Colts v The Baltimore Ravens. We'll put the line at -5 (Colts) +5 (Ravens). Now the action rarely comes in equally on both teams for a sportsbook, so in this situation let's say that the Colts are attracting a lot of action, while the Ravens only a little.
Traditionally sportsbooks liked to keep their odds at around the -110 on the spread which meant that the spread 'number' has to move. The alternative is to keep the number the same e.g. '-5' and move the odds e.g -112 or -108 etc.
With an imbalance in the action due to the demand for the Colts, the bookie is forced to make the Colts more 'expensive' by making their 'number' less attractive to the public. He'll make the Ravens more attractive to the public by adjusting their number, making them cheaper. This raising and lowering of the 'price' is therefore achieved via the spread / number.
So we'll say that the Colts now trade at -6 and the Ravens at +6. It has now become less likely that the Indianapolis Colts will cover the spread than at -5, so they are less likely to turn a profit and, therefore, have become more expensive. By the same token, the Ravens are more likely to cover the spread, so they are more likely to turn a profit and, therefore, have become cheaper.
Today, with new software and a wealth of information available over the internet to players and
sportsbooks, lines are adjusted more than ever before, whether it be adjustments in the line or tweaks in the price - often it is both. Yet the rules of simple supply and demand still exist and remain a crucial fundamental for all sportsbooks and lines-makers.
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