What is a Futures Bet? How to Make Money Betting on Futures

If you’re new to the sports betting scene, you’ve probably heard people talk about their “futures bets” before. But what is a futures bet — and how are you to make money with futures bets? While the fact you’re locking your money away for weeks, possibly months, can limit your returns, futures bets are still a great way to profit in sports betting — as long as you can find a large enough edge against the market. Without further ado, let’s discuss futures betting strategy.

What is a Futures Bet? How to Make Money Betting on Futures

What is a Futures Bet? | Futures Betting Strategy

Before we dive into how you can start making money with futures bets, let’s discuss what they actually are. Most people define a “futures bet” one that involves the ultimate outcome of a season, championship or awards race. In the NFL, a bet on who will win the Super Bowl or MVP in a given year is generally categorized as a futures bet.

Futures bets generally take a long time to settle, which is an inherent limitation to them. If you put, say, 10% of your bankroll in futures, that’s 10% of you bankroll from which you can no longer secure a compounding return on daily markets. If you aren’t getting that compounding return anyway (which you can, easily, just check out our betting model’s results), there isn’t as much risk.

When Should You Place a Futures Bet? | Futures Betting Strategy

Another question that often comes up when discussing futures bets is when you should actually place them. In the NFL, you can generally wager on the winner of the next year’s Super Bowl during that year’s postseason, meaning your money will be held by the sportsbook for over a year.

In short, you should place a futures bet only when you believe your edge exceeds what you project your returns from (a) daily sports betting or (b) a high yield savings account or other investment would be. Let’s dive into a quick math exercise to illustrate this point:

For example, let’s say it’s February 2022, and you believe that the Kansas City Chiefs have a 50% chance of winning the Super Bowl in February 2023. You project your returns from daily sports betting to be breakeven at best, and you know a HYSA could net you a 5% return over 12 months.

If the Chiefs were trading at +100 (50%) to win the 2023 Super Bowl, exactly what you believed their odds to be, you wouldn’t have an edge and would be better served by the HYSA. Even if their odds were +110 (47.6%) you’d only be getting a 2.4% edge on the market, worse than the 5% return you could get for free over 12 months.

Let’s increase Kansas City’s odds to +500 (16.7%). In this scenario, your edge (33.3%) far exceeds both your projected returns from sports betting and a HYSA over a 12-month period, justifying a wager, the size of which the Kelly Criterion could help you calculate.

Odds aren’t the only variable in this equation — time is, too. Let’s keep Kansas City’s odds at +110 (47.6%) but move the timing of our hypothetical to November 2022. Instead of the 5% return you could get from a HYSA over 12 months, your tradeoff is now the 1.3% return you would get over three. The 2.4% edge you have on the market would then be large enough to justify placing the futures bet.

How to Make Money Betting Futures | Futures Betting Strategy

Understand Your Opportunity Costs

The most difficult part of futures betting for new bettors to understand are the opportunity costs outlined above, but an understanding of them is crucial to make money betting on futures. A bet on a team to win their game tonight at odds of +1000 isn’t close to the same as a bet on that team to win their championship at +1000 for those reasons.

That said, I absolutely love to bet on futures, and I have made lots of money doing so. But when betting on them, you must understand exactly how much edge you have on the market — it must be a lot! — to make smart and efficient decisions.

Of course, the solution isn’t to just wait to bet on a future until right before the season starts (or even until later in the season) to minimize your risk. While your money won’t be tied up for as long, the odds will also be more efficient, minimizing your potential returns. It’s a balancing act that requires discipline and good timing.

Do Some Line Shopping

Let’s say you’re on the highway and are in desperate need of gas. You pull off at an exit and find two gas stations — one lists a gallon for $3.05 while the other lists one for $3.10. You’re probably heading to the station with the cheaper gas, as that would save you $7.5 for a 15-gallon fill-up.

Unfortunately, most bettors don’t think to look around before placing their futures bets, which can seriously limit their potential returns.

Just because DraftKings and FanDuel both have a futures bet trading for +1000 doesn’t mean that you won’t be able to find an off-market +1500 around somewhere, which would give you an extra 2.8% of implied probability to work with when deciding whether that bet is an efficient one.

Look at the Schedule

While understanding when you and your money are located in time is crucial for sharp futures betting, you also must think about where your chosen team or players are located as well. Let’s say you’re high on the Kansas City Chiefs heading into the 2023 season, but you know their schedule starts off quite tough, and your bullishness stems from their later schedule, which gets easier.

If you truly believe the Chiefs can rally after a slow start, you should think about the odds you’re able to get them at a better price following the first two weeks of the season. You may already have an edge now, but the chance you have a much bigger edge later could justify taking a more patient approach.

While this futures betting strategy does add the risk that the Chiefs come out hot, winning their early games and improving their odds in the process, you can quantify the probability of such a start and project what their odds would be in those situations to find the optimal point to buy them.