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Sports betting has surged in popularity in recent years, with companies like DraftKings (DKNG), FanDuel (FLUT), and BetMGM (MGM) bringing it into the mainstream.
In the latest episode of Financial Freestyle with Ross Mac, Jason Seo, CEO of The Lock Talk, joins Ross Mac to discuss the nuances of the sports betting industry and how betting strategies often mirror investing in financial markets.
Seo, a Morgan Stanley alum and Mac’s one-time intern, shares key methodologies he learned on Wall Street that apply to the gambling business.
“The biggest part of sports betting is that you need to have an appetite for risk and the ability to take losses, [and] use analytics and data to empower your decisions,” Seo continues. “So [my] training on Wall Street risk management, discipline, and it’s the ability to go through data numbers. I think the three main keys I got from Wall Street.”
Another parallel between sports betting and the financial sector is the heavy reliance on analysis. In sports betting, “you could look at [a player’s] individual stats, their history, their trends… very similar to looking at a financial statement.” says Seo.
Despite the similarities, Seo doesn’t view sports betting as an asset class. “In terms of… my portfolio, I’m heavily invested in stocks. A majority of my wealth is in the stock market and I also invest in VC or venture capital. I’ve done… seed investment Series A personally. And other than that, I do have some fixed income, but… I’m a little bit more aggressive because I feel like from my background in Wall Street and in finance, I have an edge on investing,” says Seo.
For those intrigued by sports betting, Seo offers a word of caution: “It’s not too many instances where you take like a thousand bucks and turn to a hundred grand in the market. Same thing with sports betting. It’s all statistics at the end of the day.”
Instead, he advocates for a strategy called laddering.
“[Place a bet] one thing and then maybe not completely taking… all of it, and rolling it over. Maybe take 80% of it and rolling it over and then you still have some money in the back end so you can keep on firing,” Seo advises.
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This post was written by John Tejada.