In one month, casinos lost money on basketball bets

By Jeff Haney

Tuesday, June 9, 2009 | 2 a.m.

The state’s recently released gaming revenue report for April indicated a drop in the amount casinos won in sports betting contributed to an overall decline in winnings.

A closer look reveals an intriguing dichotomy in how Nevada casinos fared in booking baseball and basketball, the two primary betting sports in April.

In baseball betting, the amount of money won by casinos dropped mostly as a result of a decline in the overall handle on baseball. On a percentage basis, the casinos still “held,” or won, a comfortable amount of all money wagered.

In basketball betting, however, casinos actually lost money during the month, though at a rate of less than four-tenths of a percentage point.

Take a look at the baseball ledger first. Casinos won $5.2 million in baseball betting in April, according to the state Gaming Control Board, holding 9 percent of the $58 million wagered.

It was the second consecutive April that the handle, or total amount wagered, on baseball declined in Nevada. This April’s handle represents a drop of 18.9 percent from the $71.5 million wagered in April 2007. In April 2008 bettors risked a total of $69.1 million on baseball in the state’s casinos.

Casinos’ hold percentage in April baseball betting has remained steady in recent years: In 2008 casinos held 10.27 percent of the total amount wagered, or $7.1 million. In 2007 casinos held 8.5 percent, or $6.1 million. In 2006 they held 8.2 percent of the $60.3 million wagered, or $4.9 million.

Casinos’ season-long hold percentage in baseball betting has also remained consistent, with the sports books holding between 4.5 percent and 4.8 percent in each of the past three seasons.

Last year books won $23.6 million, or 4.5 percent of the $522 million wagered on baseball. In 2007 they won $25.4 million, or 4.8 percent of the $528 million wagered. In 2006 they won $22.1 million, or 4.8 percent of the $457 million wagered.

Extrapolating this April’s baseball betting figures yields an early projection of a statewide handle of about $438 million for the 2009 baseball season. That would be the smallest amount wagered on baseball in Nevada casinos since 2004, when bettors risked $426 million on baseball.

The basketball betting results for April present a different picture. The handle in Nevada dropped only slightly, from $74.8 million in April 2008 to $72.5 million in April 2009. Yet this April, casinos lost $232,000, meaning gamblers won at a rate of .32 percent. In April 2008, by contrast, casinos won just over $3 million on basketball, holding 4.1 percent of the handle.

In one notable pattern in basketball betting this April, the Cleveland Cavaliers — darlings of the gambling public thanks in part to the high profile of superstar LeBron James — won and covered the point spread in all four of their NBA playoff games that month.

In another marquee game, North Carolina covered the spread as a 7 1/2-point favorite against Michigan State in the NCAA Tournament championship game, winning 89-72. The “total,” or over/under, in the game went over the closing line of 153 1/2 points to make winners of North Carolina bettors, over bettors, and anyone who parlayed North Carolina and the over.

Perhaps coincidentally — or not — sports books also took a hit the last time the favored team covered the spread and the total went over in an NCAA title game. Florida beat Ohio State 84-75 on April 2, 2007, covering a 5-point spread and sending the total well over the closing line of 140 points.

That month, sports books lost $2.6 million in basketball wagering on a handle of $61.7 million, meaning bettors collectively generated a return of 4.3 percent on their basketball “investments.”

Sports books should fare well for the 2008-09 basketball season overall despite the losing in April. Through March, casinos had won $36 million on basketball, holding 6 percent of the $597 million wagered in Nevada.

And the Cavaliers, backed heavily in future-book wagering, obviously will not win the NBA championship. They were eliminated from the playoffs in the conference finals.