Nobody will be surprised in the slightest that Dallas Mavericks owner Mark Cuban favors legal sports betting in Texas. Every owner of a professional sports franchise stands to benefit tremendously from legal sports betting. It allows them to not only partner with sportsbooks but offer their own on-site services. That's why from Cuban to Dallas Cowboys owner Jerry Jones, nearly every person in control of a Texas sports franchise wants The Lone Star State to change their views on the subject.
And yet, while Cuban's personal stake in sports betting is undeniable, he actually has a unique take on the matter. Cuban believes sports betting is a better investment than stocks.
Maybe this sounds like propaganda. And perhaps it's exactly that. At the same time, when a billionaire investor, who is also famous for appearing on the entrepreneurial reality show Shark Tank, says that sports betting is a better financial play than the stock market, you have to listen, even if you don't act on his advice.
Why, pray tell, does the Mavs owner believe sports betting is better than playing the stock market? That's what we're here to break down.
Mark Cuban Believes Knowledge is Power
Cuban previously outlined all the reasons why he views sports betting as a sneaky-good investment for many on his own personal blog. The most prominent among his justifications: knowledge.
Have you ever invested in the stock market? If the answer is yes, think about how you've gone about it. Do you have intimate knowledge of every company or bond in which you've invested? Or are you merely riding a wave, trying to capitalize on an ebb in the market or entrusting the entire process to a broker without actually knowing the companies in which you hold stakes?
For some higher-level investors, they will do their own meticulous research, leaving no stone unturned. Most Average Joes and Jills, though, leave the legwork to someone else entirely and have very little knowledge of what their money is buying. That's not the case with sports betting. Fans follow specific teams and entire leagues on an intimate level.
Sure, they may sometimes be unable to separate their fandom from the bets they make. But fans of the Dallas Cowboys are bound to know more about how to bet on NFL odds than they will about investing in the commodities or derivatives market. Even that baseline knowledge of the sports on which you're betting goes a ridiculously long way.
Put it this way: Right now, are you more likely to correctly predict the next winner of the Super Bowl or spot the next stock market inefficiency in the clean energy sector?
Sports Betting as Entertainment
You might still be skeptical at this point. After all, most people end up coming out behind when they bet on sports. It doesn't matter whether they're in Las Vegas or placing bets online. For most, sports betting is a vessel through which they lose money.
As Mark Cuban pointed out, however, responsible gamblers typically take little issue with their losses. Going to Vegas or betting on a sports event and then watching it is a form of entertainment. You cannot say the same about the stock market. As Cuban wrote:
"Most casual gamblers, who are the majority of the money spent, go to Vegas expecting to lose money. It’s part of the entertainment experience. People put money in mutual funds and in their brokerage accounts and pick stocks expecting to make money. They don’t find any value in losing money on a stock, fund or other traditional investment. That changes the opportunity completely."
Part of this point still boils down to knowledge. But even if you have no clue about the sport you're betting on, the mere act is considered an experience. Funneling money from your savings into a stock you can't see, touch or watch doesn't evoke the same emotions. It also doesn't offer the same potential for immediate gratification. Yes, some investors are day traders or short-term buyers. But most purchase stocks and then look to hold onto them as part of a years-long or decades-long portfolio. Even if you're betting on sports futures, the longest you're waiting for a result is roughly a year.
Mark Cuban May Be Right About Sports Betting
None of this should be taken as absolute advice. Sports betting is not a retirement plan for most people. But Mark Cuban makes an interesting point overall. If you have disposable income you've been tossing around the stock market, it's probably not as safe as if you were to instead bet (leisurely) on sports.
Heck, the sports betting industry might even be safer, if not heavier regulated, than the stock market. By reading through our reviews of the top online sportsbooks, for instance, customers can easily find reputable sites who will return their money and swiftly process winnings. You don't get that kind of guarantee investing in the stock market. You could lose everything if a company takes a downturn.
For the time being, this is minimally concerning to Texas residents. They still don't have legal sports betting in The Lone Star State, and they're not on track to get it before 2023 or 2024. With the support of Cuban and other owners of pro-sports franchises, many think Texas will eventually push betting through.
Until then, at least you can know that when you are betting on sports, perhaps because you're heading to Las Vegas or just traveling across Texas state lines, you're not wasting your hard-earned money any more than you would be by gambling in the stock market.
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