Looking to understand the difference between betting handle and revenue?
You’ve probably heard the term “handle” in sports betting and wagering – especially when the Super Bowl swings around, an event notorious for the biggest sports handle of the sporting year. But what does it mean and how does it differentiate from revenue?
In this brief guide, we take a look at the difference between the two, and why they matter to sportsbooks – and you, the punter.
Handle refers to the amount of cash wagered by sports bettors over a specific period at sportsbooks.
Metrics include sports, sporting events (such as the Super Bowl), as well as types of bets.
Handle typically goes up and down according to what time of the year it is, which makes it seasonal.
For example, a handle may hit a slump during pre-season for the major sports, and it will rocket during March Madness when the NBA and NHL playoffs are in full swing.
Sportsbooks revenue is different from handle because it’s the amount of cash a sports betting site retains after the handle has been paid out to winners.
For example, let’s say the total amount wagered on the Super Bowl is $5,000,000. Because punters collectively won $4,500,000, the revenue gained by the sportsbook is $500,000.
It’s unusual for a sportsbook to retain more than 5% of the handle. In 2017, US sportsbooks managed to retain over 5%, but generally speaking, they typically retain around 5% each year.
This might seem like a small amount, and it’s true that sports betting sites – contrary to popular belief – operate at tight profit margins.
This is also why sportsbooks would be resistant to a 1% integrity fee, and it’s largely why handle matters so much. If a sportsbook were to be hit by a 1% integrity fee demanded by sports leagues, they’d only be returning 4% of the total handle at the most. Plus, there are hefty tax rates to consider, too.
The handle would seem to be a largely redundant matter to the average punter.
However, it’s worth looking out for because sportsbooks use handle to help them set a betting line.
If, for example, the Super Bowl is receiving a lot more attention this year than it did last year, they may alter their lines.
How should this affect you?
Well, it needn’t really affect the recreational bettor. But pro bettors will likely spot the change immediately and will bet on a specific side because the original odds are incorrect.
And sometimes there’s no problem with the odds. However, the handle is still worth knowing because it shows a bettor where the money is going (and therefore who to back or not to back).
Handle probably matters more to sportsbooks than it does to recreational bettors who just enjoy a flutter here and there. However, if you’re a pro sports bettor, or want to take up sports gambling full-time, understanding the difference between handle and revenue is key.
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