Both options sellers and sportsbooks are price-setters in growing speculative markets. With the increased availability of sports betting and options trading, potential inefficiencies in risk-taking behavior could be exposed in these markets. This paper serves to compare the risk taking behavior of sportsbooks and options sellers. Two proposed statistics were used to measure risk in these speculative industries. Risk premium, based on concepts from Arscott (2022) and Moskowitz (2021), measured risk from a per-dollar returns framework. Tail Risk Ratio is a novel addition to previous literature which compares the tail risk of sellers and buyers in speculative markets. The relationship between these two statistics was also explored. The findings of this paper show that options sellers take on significantly more risk than sportsbooks in both an average and volatility-based framework. In addition, it was found that there was no significant relationship between the two proposed risk statistics.
