My uncle was a professional gambler and did well at it. At first he counted cards playing Blackjack, but eventually was banned from most casinos where it was actually possible to win at Blackjack. (Casinos in Atlantic City aren't allowed to ban card counters, so they use huge decks and shuffle frequently to make winning via card counting infeasible.)
He mostly switched at some point to betting on sports. He arbitraged the odds that the bookies used compared to odds that were apparently more accurate, probabilistically.
I asked him how he could possibly have a better sense of the probabilities than the bookies, whose job it is to get this right. He replied that the bookies don't set the odds based on probabilities, but rather just so that they have an equal amount of money on both possible outcomes, and therefore they would always make money no matter what.
So the odds that the bookies used were often not good measures of the actually probabilities, but rather often more a measure of public sentiment. And he could take advantage of this difference.
He mostly switched at some point to betting on sports. He arbitraged the odds that the bookies used compared to odds that were apparently more accurate, probabilistically.
I asked him how he could possibly have a better sense of the probabilities than the bookies, whose job it is to get this right. He replied that the bookies don't set the odds based on probabilities, but rather just so that they have an equal amount of money on both possible outcomes, and therefore they would always make money no matter what.
So the odds that the bookies used were often not good measures of the actually probabilities, but rather often more a measure of public sentiment. And he could take advantage of this difference.