I was watching a video by Peter G. Klein recently on entrepreneurship and how the value of taking risks in an uncertain environment is as important as it is in any other profession in the labor market. Then, around the 32-minute mark, the video started addressing uncertainty. It got me thinking about something related to sports betting, which I wrote about below.
So, with relation to betting, I’m thinking about things this way after watching the video: As sports bettors, we can try to calculate possible outcomes—especially nowadays with data apps that use AI to calculate the likelihood of, let’s say, Kyle Stowers of the Miami Marlins hitting a home run tonight. Perhaps the way the data is presented creates the belief that he will indeed hit a home run because he has a streak of this occurring at a high likelihood. A probability is supposed to be related to the event occurring identically over a period of events, but, according to Richard von Mises, this can’t be true when we are dealing with humans, because no event is ever identical.
In this case, we can relate this to baseball by understanding that no matter if the application you’re using says that this player is in the green and very likely to hit a home run, he’s still a human and is dealing with many variables—like weather, time of the game, history against the pitcher, possible fatigue, maybe nutritional issues. Who knows? But you get the point. Nothing involving humans can ever be certain, and when we are betting in the sports markets, we are often making predictions about uncertain events.
What we can do is focus on these events using these tools and go ahead to predict the outcome—but keep in mind the variables that these applications do not see, such as time of day, weather, ballpark dimensions, personal connection against the opposing team's pitcher, and so on. Also, always remember that nothing is ever 100 percent certain when betting. Though these apps at least help us zero in on and focus on specific events, so they help cut down research time. This is one reason, among many, why now is such an awesome time to take risks in the sports markets.