Tuesday, April 08, 2008

Odds 'n' Sods

Just a quick note on a recent addition to the sidebar. There is now an odds converter that takes standard American Odds (e.g. -130/+110) and outputs the percentage chance of winning, as decided by the oddsmaker. Javascript must be enabled on your browser for it to work.

The theoretical (or practical, or natural) hold is the amount that your bookie would keep if he got the balance of wagers on both sides, such that he would take the same profit either way. So, using the first round series prices from the graphic below as an example, if your bookie takes $740 on San Jose to win their series (74% chance of winning), and $260 on Calgary to win the same series (26% chance of winning), then no matter who wins he will hold onto about $36 dollars and pay the rest out in return of stake plus winnings. So a 3.6% hold.

First Round Series Prices

Now obviously the vast majority of sports bettors lose at a level larger than the natural hold.

Some comments in the blogs moved me to put this up here, the pendulum seems to swing pretty wildly depending on how the bounces have gone in the last game or two. There is a lot of parity in this league now, in any one game the home team is very likely to be the favourite, and in most games the underdog still has at least a 40% chance of winning. And even adding a superstar to your roster is only going to bump that a few percent.

Of course the bookies will want to take more than 5%, so they'll be hoping for underdogs to take series, and mostly for road wins from anybody, which they'll cheat about 1%, maybe a touch more. Casual bettors like the favourites a lot, no matter the odds.

They'll also be hoping for losses from the team with the sense of urgency in the must win games. So if a home team loses game 1 of a series, then their nuts will be in a vice for game 2, the casual bettor loves that, but it is essentially immaterial. The game line will be cheated down a smidge, maybe half of one percent, but most of the action will still come on that side of the line. Most bookies will lose a lot of money if these teams find a way to come through in the clutch, but don't cry for them, they'll get it back in time.

Personally I like all the favourites except Minnesota, but that's not much of a margin, if the Avs take one of the first two games in Minny they become the oddsmaker's faves. I like WSH over PHI, even with the Caps being favoured that much. I still like the Ranger's chances of coming out of the East, as well. That's a solid team. The odds on San Jose seem a little high to me as well, the underlying numbers for the Sharks are impressive, but I think they've been overvalued here, because to my mind, at least in part they come from Wilson's growing obsession with puck possession.

Should be a good playoffs this year, Lets hope for some wild series with lots of open ice, and for a bunch of upsets.


Blogger Slipper said...

Nice addition, Ferrari.

I think the Devils would be the favourite if they played 200 miles outside of NYC. The Devils aren't a weak team by any measure, either. Though the Rags did take the season series 7-0-1, although with 3 extra time wins.

Renney has enough weapons this go around that the Rangers shouldn't fall like dominoes behind Jagr. I still predict a tight series, with the smart money on the Rags.

I've seen a lot of cash lost on the smart money, though.

4/08/2008 12:29 pm  
Blogger Vic Ferrari said...

Yeah, most bookies are going to take a hammering if the Rangers win, no doubt. And New Jersey would probably be the favourites for the series, ever so slightly, if they were based in Buffalo. Maybe getting half a percent more per game, parlayed through that would be enough.

Mostly I was trying to establish a couple of things:
1. There is a lot more parity in the NHL right now than most people sense.
2. When you place a wager, you're betting against the oddsmaker, not the bookie. Or at least to a huge extent.

I remember a while ago mc79 replied to a commenter's remark about wagering by saying "I could probably beat the market". Well no shit, just bet on the road teams and you'll finish inside the holds most months, and beat 90% of the punters. Same goes for the NFL.

Beating the market is easy, because the market is terrible. Beating the oddsmakers is a different matter altogether.

4/08/2008 2:18 pm  
Blogger Slipper said...

Fenwick has some nice graphics up illustrating the head to head records of the Western Conference playoff team that pretty echoes your sentiments in regards to parity. Ecspecially if you remove Detroit from the conversation.

I always believed that the real skill of a book was in manipulating the lines in order to hedge the bets. Essentially, they cover their own asses by weighing heavily on the favourite. I saw some statistics somewhere, which I'm going ot try to find, that showed how hard the market will stick with a favourite, even when the line inflates.

4/08/2008 4:03 pm  

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