A sportsbook is a gambling establishment that accepts bets on various sporting events. It is a highly regulated industry and offers responsible gambling to its customers. Those who win bets receive a payout determined by the odds of the event they placed a bet on. Those who lose, however, are not paid. Moreover, the house always has a slight edge over its bettors.

Market making books take all comers and offer high limits, but it’s very easy to lose money on these types of bets if the bookmaker doesn’t make its markets intelligently (i.e. profiles customers poorly, moves too much on the wrong action, makes too many plain old mistakes, sets limits poorly). In addition to that, it’s just hard to make a profit on bets with negative expected returns.

Retail sportsbooks face a much more complicated situation because they are in constant fear of being taken down by sharp bettors who know more about their lines than the books themselves do. They balance these competing concerns by taking protective measures such as lowering their betting limits (particularly for bets made online) and raising their holds on bets in their live markets.

Most retail sportsbooks do not set their own odds, but rather rely on third-party software, such as Kambi Group, or a data feed to provide them with the best lines. As a result, they are effectively a black box in the sense that they don’t get all of the backstory on how the line was set and what the underlying assumptions were behind it.