Do you know how to pick ‘em? In today’s episode, the guys are covering the flaming hot trend of sports betting! Joining Austin is Will Hinks, Operation Specialist at Hixon Zuercher Capital Management. They detail everything from the history of sports betting in the US to common gambling terms you need to know! Listen now!
Main Talking Points
[0:45] – Who is Will Hinks?
[2:29] – Sports Preferences
[3:19] – Disclaimer
[4:03] – History of Sports Betting in the U.S.
[6:43] – Sports Betting in Ohio
[7:28] – Dad Joke of the Week
[7:57] – Common Sports Gambling Terms
[10:45] – Mattress Mack
[11:22] – How Can You Invest in this Trend?
[13:02] – Should You Invest in this Trend?
Links & Resources
Gambling Addiction – Smart Recovery
History of Sports Betting in the USA – Legal Sports Betting
031: ETFs vs Mutual Funds – The Invested Dads
Invest With Us – The Invested Dads
Free Guide: 8 Timeless Principles of Investing
Social Media
Full Transcript
Intro:
Welcome to The Invested Dads Podcast, simplifying financial topics so that you can take action and make your financial situation better. Helping you to understand the current world of financial planning and investments, here are your hosts, Josh Robb and Austin Wilson.
Austin Wilson:
All right. Hey, Hey, hey, welcome back to The Invested Dads Podcast of podcasts, where we take you on a journey to better your financial future. Today, we are going to be discussing the flaming hot trend and that is the trend of sports betting. I am joined today by my esteem colleague and friend, Will Hinks.
Will Hinks:
Right. Thanks for having me on the show, Austin.
Austin Wilson:
Oh, it is my pleasure.
Will Hinks:
I was always told I had the perfect face for radio.
Austin Wilson:
You do, you fit right in.
Will Hinks:
I missed my calling right here.
[0:45] – Who is Will Hinks?
Austin Wilson:
You fit right in. I guess, Will, take a few moments, introduce yourself, talk about your background, what you do, what you are going to be doing, and just give some insights into your personal life?
Will Hinks:
Sure. Professionally, I joined the Hixon Zuercher team back in November of 2021 as the operation specialist. I complete the trading, money movements and reporting functions here at Hixon Zuercher. At some point in a not too distant future, I’ll be joining my friend, Austin, which friend might be a little bit of a strong word.
Austin Wilson:
That’s right.
Will Hinks:
Maybe colleague or acquaintance.
Austin Wilson:
Acquaintance. That’s right.
Will Hinks:
Probably better.
Austin Wilson:
Yeah.
Will Hinks:
I’ll be joining Austin, the investment research team here in the next 12 to 18 months or so. Prior to joining Hixon Zuercher, I worked in the finance department at Marathon Petroleum here in Findlay, Ohio. Now on the personal side.
Austin Wilson:
Oh, yeah.
Will Hinks:
I always like the personal side. My wife, Jessica and I live here in Findlay, Ohio with our little baby girl, Allison. always showing pictures of Allison around the office here.
Austin Wilson:
Absolutely, and you are an Invested Dad.
Will Hinks:
I am the Invested Dad. Yes. Yeah. For those of you familiar with Hixon Zuercher, that is the same Jessica that works here as a wealth advisor. I work here with my wife.
Austin Wilson:
She’s been on the podcast before too.
Will Hinks:
She has, and she’s probably a little better at it than I am.
Austin Wilson:
And quite popular.
Will Hinks:
Yes, she is. I married up, what can I say?
Austin Wilson:
That’s right.
Will Hinks:
Yes, but yeah, we moved back to Findlay, Ohio back in 2019 from Dayton, Ohio and I’ve loved it, besides the occasional flooding that we get here.
Austin Wilson:
Flood City, USA.
Will Hinks:
It is.
Austin Wilson:
Wait, you moved from Dayton to Marion?
Will Hinks:
Dayton to Findlay.
Austin Wilson:
I know. Get it?
Will Hinks:
Yeah, I’m with you. Yeah. I’m with you.
Austin Wilson:
Well, awesome, Will. Thanks for joining us. I guess where the rubber meets the road today is because you are quite the sports fan.
Will Hinks:
I am.
[2:29] – Sports Preferences
Austin Wilson:
Explain how where you grew up impacted your sports preferences and where you land on that?
Will Hinks:
Sure. I’ve been pretty much a sports fan my entire life. I grew up just north of Pittsburgh, Pennsylvania in a little town called Beaver Falls, Pennsylvania which, side note, that is also the hometown of Super Bowl winning quarterback, Joe Namath.
Austin Wilson:
And Medicare commercial advocate.
Will Hinks:
Yes, one and the same. Grew up just north of Pittsburgh so I’ve been a big fan of all things Pittsburgh my entire life. Pittsburgh Steelers, Penguins, Pirates.
Austin Wilson:
Primanti Brothers.
Will Hinks:
Anything, Pittsburgh, I love it.
[3:19] – Disclaimer
Austin Wilson:
Good. Well, that is awesome. Yes, Will is the resident sports guy here in the office, which leads me to our topic today, and that is sports betting. Will, you have a pretty good understanding of the process and the industry, and we’ve got some questions. But first of all, I think we should have a disclaimer that a) gambling’s a divisive topic within certain people groups and each person has to choose where they fall on the morality of that, both legal and illegal, and b) we acknowledge that many people have been negatively impacted by gambling or may struggle with the addiction themselves. We are not condoning that in any way, shape or form, and we’ll put a link in a shown notes to resource for gambling addiction. With that disclaimer behind us, we’re going to talk about gambling.
Will Hinks:
Let’s get into that.
[4:03] – History of Sports Betting in the U.S.
Austin Wilson:
Also, I want to actually focus in a little bit more today. We are focusing on legal sports betting generally with this episode in the US. Now, there’s a long tradition of friendly wagers between coworkers and friends as well. Some big money, illegal gambling, we are not discussing that today. We’ll focus on regulated and legal sports betting. Will, let’s talk first about the history of sports betting here in the US. According to a website that I will link in the show notes, legalsportsbetting.com. Sounds legit, right?
Will Hinks:
Sounds legitimate.
Austin Wilson:
Sports betting gained popularity in the early 19th century, so that’s the early 1800s, and horse racing was actually the most popular sport to bet on.
Will Hinks:
Have you ever seen a horse race in person?
Austin Wilson:
I’ve seen it on TV. No, I’ve never seen it in person. Have you?
Will Hinks:
I’ve seen a couple races.
Austin Wilson:
And?
Will Hinks:
They’re pretty interesting, pretty fun.
Austin Wilson:
It seems like a crapshoot.
Will Hinks:
Yeah.
Austin Wilson:
That’s a gambling reference.
Will Hinks:
Look at that. I like it, I like it.
Austin Wilson:
I didn’t even think about that, but how do you pick a horse that’s going to do well or not?
Will Hinks:
Who knows?
Austin Wilson:
I have no idea.
Will Hinks:
Yeah.
Austin Wilson:
Anyway, that was how gambling got started here in the US. But after that, it was actually the establishment of professional baseball in 1876 with the National League, and the American league in 1901, that made sports betting really popular. Early on though, the results were found to be a influenced by the betting. Especially as an example, the Louisville Grays were throwing games to make money, so that’s not good.
Will Hinks:
No.
Austin Wilson:
Kind of gave a bit of shade to the gambling industry at that point. At this time, even managers would be able to wager on games for or against their own teams. Yeah. That sounds bad.
Will Hinks:
Sounds sketchy.
Austin Wilson:
Yeah. That’s frowned upon and, obviously, later on there were issues with that, just ask Pete Rose. Yeah. We’re not going to go there. Then in 1919, the World Series. This was really the linchpin of illegal gambling industry because this was all illegal up to this point. Not enforced, but technically illegal. The linchpin was that the Chicago Black Sox were bribed into throwing the World Series in 1919, and that was no bueno. In 1931, it wasn’t until then that we even had any legal gambling period in the United States. But like I said, it was unenforceable. In 1931, Nevada legalized gambling, and from that point on it was pretty much you had to go to Vegas or Nevada in general to gamble legally, and that was what happened. However, that wasn’t the only place gambling was occurring. Obviously, there was a lot of illegal gambling that was going on. Organized crime, actually, ran gambling functions from coast to coast, and it was obviously illegal until 1961. Though it was out in the open, it was still illegal. This was shut down with the Interstate Wire Act of 1961, and after that more and more states added legal sports betting and gambling through the ’70s, ’80s and ’90s. As of 2020, according to americangaming.org, 22 states plus DC have legalized sports betting, and more bills have passed awaiting full implementation of that going forward, and one of those states is Ohio. You want to elaborate a little bit on that?
[6:43] – Sports Betting in Ohio
Will Hinks:
Yeah, just some, I guess from what I understand is the bill was signed into law by our governor, Governor DeWine, in late 2021 and where it’ll be in effect where you can legally gamble on sports by the end of 2022. Sometime this year we should be able to, if you’re so inclined, you should be able to gamble on sports here in Ohio.
Austin Wilson:
Here you go. That is coming. That is the history. That’s the history of sports betting. There’s a long and interesting history, and that was really just the cliff notes. You can get a lot more detailed if you’d like, but that leads us to where we are today, and like Will said, coming up in Ohio even this year you’ll be able to do that.
[7:28] – Dad Joke of the Week
Will Hinks:
Hey, Austin. Since seeing how I’m one of the Invested Dads officially.
Austin Wilson:
You are, oh yeah.
Will Hinks:
I think today is the official coronation of being an Invested Dad.
Austin Wilson:
There’s a t-shirt coming your way.
Will Hinks:
I’m looking forward to it. I feel like it’s only appropriate I do a dad joke.
Austin Wilson:
I think you should.
Will Hinks:
Josh isn’t here.
Austin Wilson:
No.
Will Hinks:
I feel like someone has to. All right, so here’s my dad joke.
Austin Wilson:
Bring it.
Will Hinks:
My wife said she’s going to leave me because I have a gambling problem.
Austin Wilson:
Oh, that’s so sad.
Will Hinks:
But I think she’s bluffing.
Austin Wilson:
You think she’s… Okay. I like it, I like it, bluffing. That’s good.
[7:57] – Common Sports Gambling Terms
Will Hinks:
What I want to talk about here is just some of the common terms you’ll see in sports gambling. You’ve probably seen this if you’re on ESPN or maybe your favorite sports site. You probably see some gambling things there. It’s like, maybe you don’t know what those are, so I’m just going to walk through some of the key terms that you’ll see on gambling.
Austin Wilson:
That sounds awesome.
Will Hinks:
The first one, let’s talk about fractional odds. Have you ever heard of, as someone says, “Hey, I’ll give you 10 to 1 odds on that?”
Austin Wilson:
Yep.
Will Hinks:
Seems you hear that or I’ll give you 2 to 1 odds for that. What that means is, someone says you have 10 to 1 odds to win, you would win $10 for every $1 that you bet.
Austin Wilson:
Right.
Will Hinks:
In addition to the $1 that you bet, so if you won that you would get $11 back out of the $1 you bet.
Austin Wilson:
Yep.
Will Hinks:
Pretty simple. That’s an easy one.
Austin Wilson:
This was like in CFA Level 1.
Will Hinks:
It was pretty easy. Let’s go to the next one. The next one is Moneyline. If you’re betting Moneyline, the team that is favored to win is shown with a minus sign in front of it.
Austin Wilson:
Yep.
Will Hinks:
Followed by the amount that you would need to profit $100. For example, if you see a team that has a <oneyline odds of minus 300, and this means you would need to bet $300 to profit $100.
Austin Wilson:
Yeah.
Will Hinks:
If you win that you have to bet $300. In the end, you would get $400 back. Your initial 300 plus the $100 you won.
Austin Wilson:
Got you.
Will Hinks:
On the flip side, the underdog team is shown with a plus sign in front of it. This represents the amount you would profit if you bet $100. So, if a team has Moneyline odds of plus 200, this means you would profit $200 for every $100 you bet.
Austin Wilson:
Makes sense.
Will Hinks:
Still with me here?
Austin Wilson:
Still with you.
Will Hinks:
All right. Let’s go to the last one here, so spreads. This is probably the one I most see most common, you see on ESPN or something.
Austin Wilson:
Yep.
Will Hinks:
You’ll see a spread.
Austin Wilson:
They had it for the Super Bowl.
Will Hinks:
They did and that leads me right into my examples here.
Austin Wilson:
I try.
Will Hinks:
You’re good, Austin. Let’s use the Super Bowl as an example, which may be a sore subject for those here in Ohio.
Austin Wilson:
Yeah, those Bengals.
Will Hinks:
Yeah.
Austin Wilson:
So close, maybe next year.
Will Hinks:
But as a Pittsburgh fan, what can you say? The Los Angeles Rams are four-point favorites going into the game.
Austin Wilson:
Yep.
Will Hinks:
If you thought the Rams would win by more than four points, you would bet on the Rams. However, if you thought the Rams would lose by or win by less than four points, or they would lose, then you would bet on the Cincinnati Bengals. As it turns out, so even though the Bengals lost the game, they lost by a score of 23 to 20, so if you had bet the spread and you had bet on the Bengals, you would’ve won since they had lost by less than four points.
Austin Wilson:
Yeah.
Will Hinks:
Makes sense?
Austin Wilson:
So someone made some money.
Will Hinks:
So someone made some money betting on the Bengals, so it wasn’t all gloom and doom for Bengals fans out there.
[10:45] – Mattress Mack
Austin Wilson:
Right. Wasn’t there a furniture store?
Will Hinks:
There was.
Austin Wilson:
In Cincinnati?
Will Hinks:
Yeah. There was actually a gentleman by the name of Mattress Mack was his nickname.
Austin Wilson:
Mattress Mack.
Will Hinks:
Mattress Mack, he bet just under $10 million. Unfortunately, he bet the moneyline that he bet Bengals would win the game, so he did not end up winning that bet. But if he had bet the spread, then he would’ve won.
Austin Wilson:
Okay. Well, maybe next year.
Will Hinks:
Yeah.
Austin Wilson:
What we’re going to keep going back to.
Will Hinks:
Yes.
[11:22] – How Can You Invest in this Trend?
Austin Wilson:
Yeah. Those are the terms you hear about when you’re talking about gambling in general when it relates to sports. Keep those in mind when you open up the DraftKings app or whatever in Ohio when it’s legal later this year, or whatever you look at for that. But I guess the question that we want to talk about is investing in this, right? Number one, how can you invest in this trend? Well, there are some ways and I’m going preface this by saying, we’re not saying to invest in this. In fact, a lot of “ESG funds” and things out there probably will have none or very limited exposure to gambling because that’s kind of a hot subject for a lot of people. However, there are some individual stocks that can give you dedicated exposure to this. One of them being DraftKings, obviously. Another one is a company called Flutter and it’s actually a UK based company, but they own FanDuel, which is another popular app. You can buy in the UK, the ticker’s FLTR, but you can actually buy the ADR here in the United States, which is PDYPY. You can also get dedicated exposure through casinos, which also have a hotel aspect in it as well, and those would be Caesars or MGM. But then if you want to not take the individual stock risk, you can invest in things like ETFs, and again, we always say it, but we have an episode talking about the differences between ETFs and mutual funds. We’ll link that in the show notes. But one of those is the VanEck Gaming ETF. That’s ticker BJK, and another is Roundhill Sports Betting & iGaming ETF, and that’s ticker… Josh loves big tickers, really good tickers. This is a good one. B-E-T-Z.
Will Hinks:
B-E-T-Z.
Austin Wilson:
BETZ.
Will Hinks:
BETZ. I like that. I like that.
Austin Wilson:
Someone paid up for that ticker, obviously. That’s ticker flipping has got to be a real thing, wouldn’t you say?
Will Hinks:
Yeah, I would. Yeah.
Austin Wilson:
You should just buy all the tickers that or could be anything famous and then boom, make millions of dollars.
Will Hinks:
Sounds like a million dollar idea.
[13:02] – Should You Invest in this Trend?
Austin Wilson:
Sounds like a million dollar idea. So that’s question number one. How can you invest in this trend? But question number two, I think’s a little bit more nuanced and that is, should you invest in this trend?
Will Hinks:
Good question.
Austin Wilson:
The answer really is, it depends, as it always is or in moderation, as Josh would say. No, the real answer is, talk to your advisor because it has to be something that fits your overall financial picture. But in summary, I would say, I wouldn’t bet the house.
Will Hinks:
I see what you did there. I like it.
Austin Wilson:
But specifically, looking at some of these stocks, DraftKings comes to mind, we’re sitting here recording this on the 18th of February. They released earnings last night and they were quite bad, and they’re stock’s down about 20% following earnings. That’s why I said I wouldn’t bet the house because you put all your eggs in a basket like that, it’s not so great. A lot of these companies, specifically thinking of DraftKings or whatever, they’re still losing a lot of money. They’re still really young and trying to grow. They’re not really earning a lot of profits. They’re very, very risky. So, that is something that I would say, but in general, don’t put something into this area of the market that you’re not willing to lose. It’s practically gambling.
Will Hinks:
It’s good advice. It practically is.
Austin Wilson:
It’s practically gambling. That is, should you invest in this trend, but I guess that’s really where we are today on sports betting here in the United States. Will, any final thoughts?
Will Hinks:
I don’t think so. I think you covered it pretty well. Appreciate you having me on the show again. It’s been an honor.
Austin Wilson:
Hey, we’ll have to do it again. We will have to do it again. From Will, the honorary new Invested Dad, and myself, thank you for joining us. As always, check out or free gift to you. It’s a brief list of eight principles of timeless investing. These are overarching investment themes meant to keep you on track to meet your long term goals. It’s free on our website and you may wonder how can people help us grow this podcast and help lots of people? Well, there are a couple things you could do. Number one, subscribe and leave us a review on Apple Podcast. We would love that. We put episodes out every single Thursday and your review will help us show up on searches and on any app that you open it up there. Number two, on Spotify you can follow us and give us a rating, hopefully five stars. We hope we enlightened you that much. We hope we’ve earned that for you, but you could follow us and like us there on Spotify. Also, you could email us any ideas to hello@theinvesteddads.com. We love to hear from our listeners and we listen and read every single email, and would love to incorporate any ideas or topics you have and answer any questions you have. Finally, share this episode if you have someone in your life that has been talking about sports betting because we think that they would probably enjoy it. Share this with the share button and share that with them. Until next Thursday, from Will and I, have a great week. Thanks. Bye.
Outro:
Thank you for listening to The Invested Dads Podcast. This episode has ended, but your journey towards a better financial future doesn’t have to. Head over to theinvesteddads.com to access all the links and resources mentioned in today’s show. If you enjoyed this episode and we had a positive impact on your life, leave us a review, click subscribe, and don’t miss the next episode. Josh Robb and Austin Wilson work for Hixon Zuercher Capital Management. All opinions expressed by Josh, Austin or any podcast guest are solely their own opinions and do not reflect the opinions of Hixon Zuercher Capital Management. This podcast is for informational purposes only and should not be relied upon for investment decisions. Clients of Hixon Zuercher Capital Management may maintain positions in the securities discussed in this podcast. There is no guarantee that the statements, opinions or forecast provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses, which would reduce returns. Securities investing involves risk, including the potential for loss of principle. There is no assurance that any investment plan or strategy will be successful.
