Being a successful sports trader is all about being analytical while constantly learning and looking for more edges to benefit from. And reading a good book can be a difference maker in finding the right mindset.
In this article, the ScoreMetrics Lab introduces three of our favorite books that we think are tremendously useful for sports traders.
Without further ado, let’s get to it!
1. Thinking Fast and Slow by Daniel Kahneman
In this book, Daniel Kahneman, world-famous psychologist and winner of the Nobel Prize in Economics, introduces the two different ways or systems in our brain that determine the way we think.
What does this have to do with sports trading? Bear with us here.
In summary, the book explains how the two systems are constantly in battle for control over our thoughts and actions, and how that leads to errors in judgement and decision making when not acknowledged.
The first system in our brain is automatic, acting on impulse and emotions. As we are constantly bombarded with information and decisions that we need to make every day, this is the mode where we are kind of by default.
The second system is conscious, thoughtful and analytical. It’s at work when we are engaged and thinking.
Here’s the big problem when it comes to money and sports trading: Our brains are naturally lazy. They are trying to save energy and stay in the first system – the one that acts on intuition. And if you are familiar with the ScoreMetrics method, this is exactly the opposite of what’s needed to do to be successful in sports trading.
But when we acknowledge this, take a deep breath and switch into the analytical mode, we avoid the mistakes that 99% of the people in the sports betting market do while they are acting emotionally.
The book is full of interesting examples related to cognitive biases, sample sizes and mistakes in finding patterns – very relatable to sports traders.
2. Moneyball by Michael Lewis
This one is probably familiar to most of our readers – the story of how the Oakland Athletics, led by their revolutionary general manager Billy Beane, were able to build a highly competitive team with one of the lowest budgets in the league, using an analytical sabermetric approach. Many have also seen the 2011 film adaptation of the book, starring Brad Pitt and Jonah Hill.
Beane leaned into rigorous data analytics instead of traditional counting stats and scout evaluations when assessing players – an approach that was not understood by most people in the business in the early 2000’s. The A’s were able to fill their roster with undervalued players and were competitively at a similar level with the likes of the Yankees ($44 million vs. $125 million salary budget in 2002).
While traditionalists bashed the approach at first, it quickly became the new normal, and today, every baseball club uses a sabermetric approach and employs a team of data analysts, constantly trying to spot patterns and find an edge. And as our head trader John Todora has said, the sabermetric approach was also an early building block for ScoreMetrics.
Besides being an incredible sports story that speaks to analytical thinkers, this is also a prime example of how finding inefficiencies in a market can create a huge competitive advantage. And that’s definitely something we are doing here at the ScoreMetrics Lab.
A highly recommended read.
3. Sharp Sports Betting by Stanford Wong
If you are not 100% sure how the sports betting market works in detail, this one’s for you.
In this book, Stanford Wong explains all of the basic and advanced concepts of the sports betting market and goes deep in all topics while providing plenty of examples.
The basics cover the terminology, different types of investment methods in the market, how bookmakers work, and so forth. And in the advanced topics, Wong goes into handicapping techniques, talks about how recent trends are usually just noise in data, and provides lots of charts and statistical analysis.
All great stuff that sports traders will benefit from.
So there you have it – three very different types of books that are extremely useful for making it in the sports betting market as an investor.
Lastly, we should also mention our head trader John Todora’s new book – “Zero Correlation Investing – The Score Metrics Secret”, as it touches on all of the topics mentioned above and gives you an overview of everything you need to know about trading in sports.
It’s currently on sale for a limited time and you can get your copy immediately from here. Pretty convenient!
Sports are back – let’s make the most of what the market has to offer for us.
The ScoreMetrics Lab is the engine that runs the Sports Trading System operation, consisting of a team of researchers and writers who are constantly testing and retesting algorithms. They work hand in hand with our Head Trader and Creator of ScoreMetrics, John Todora to help find new breakthroughs and develop new systems.