4rabet casino:What is the popular-unpopular bias?

Every bookmaker will set aside a certain profit margin on betting odds to ensure they are profitable. To do this, bookmakers will reduce the odds below what is fair to expect for each outcome.

How to add profit margin to odds
Common sense would generally suggest that liabilities can be best managed by evenly distributing profits to each player. For example, if two players are evenly matched, their fair odds are 2.00. Adding a 2.5% profit margin to each player reduces their fair odds to 1.95.

But what happens if the strength of the two participating parties is very different, for example, the odds of the two parties are 1.20 and 6.00 respectively? If the 2.5% profit margin is evenly distributed, the respective odds are reduced to 1.17 and 5.85 respectively. However, this is often not the case.

Instead, we are more likely to see odds like 1.19 and 5.41. The odds of the weaker side drop much more than the odds of the favorite. In terms of profit margins, in this case the weaker side’s profit margin is 11%, while the popular side’s profit margin is only 1%. Why it came out like this? This phenomenon is often explained by the so-called favorite-unfavorite bias.

Examples of popular-unpopular bias
There is ample evidence in the sports betting industry that the odds on the underdog are disproportionately lower than fair odds compared to the odds on the favorite, and this phenomenon is no exception in horse racing, football, tennis and other niche sports betting industries. .

It is believed that bettors tend to display risk-seeking utility for longshots and risk-averse sentiments for favorites. This non-linear possibility carries some weight, and misunderstandings of the relative probabilities may shape specific utility preference. Although described as such, the popular-unpopular bias represents a typical
cognitive bias
.

4rabet casino prides itself on offering the most competitive profit margins in the betting market. For major football events such as the European Championships, 4rabet casino’s profit margin is around 2%, compared to the industry average of 6%, meaning you win more per bet.