Handicappers are always looking to achieve a perfect balance. You don’t want to be tied to too many favorites, but you don’t want to be rooting for underdogs all the time either. Underdogs are traditionally bad teams, or at least teams that aren’t as good as the other team, and the psychological strain of betting on a team not expected to win the game is too much for some to overcome.
Recently, as bettors have gotten smarter and have been more willing to embrace models and analytical data, we’re seeing less resistance against betting big favorites. On the other hand, we still have the traditionalists who believe that dogs are the way to go and the bigger, the better. For me, and hopefully for our readers, value is value, irrespective of how we find it, where we find it, and what the price is that we have to pay.
BangTheBook Radio listener and reader John, @realdiofio, reached out to me on Twitter earlier this week about something extremely interesting. He had been having a talk with an unaffiliated party on Twitter about the merits of playing big favorites. Big favorites really do have a negative perception in the market. Professional handicappers in the tout industry, or even the Twitter community of cappers, get looked down on for using big favorites as “stat fillers”, which can, and often do, increase win percentages and unit counts. “Of course that -200 favorite won,” they will say, “it’s f-ing supposed to!”
Ah, but there’s far more than meets the eye. At its core, handicapping is an exercise in probability. We play on likelihoods. We play on expectations. Each individual’s expectations are weighted differently, but we always find a way to come to a conclusion. For some bettors, it is as simple as, “This team should play better today.” For others, it is more complex, like “This team should win 42 percent of the time per my models, but the line implies a 37 percent probability.”
However you handicap, whatever methods you use, you have to understand the odds. Too many people break down games as Team X vs. Team Y with Star Players A and B on one side and Star Player C on the other. Whether it comes from a fantasy standpoint or just from watching sports coverage with pundits and ex-players throwing out opinions, there are a lot of simplified schools of thought out there when it comes to handicapping. It all cycles back to finding that perfect balance. To looking at the game from all angles and all sides.
But, you simply cannot forget about the odds. The odds tell us a lot. They tell us the expectations of the oddsmakers, the risk managers, the betting market, the sharps, the public, the squarest of the square, and the highest of the rollers.
Bankroll management is and always has been an important part of the equation. Some people won’t play -200 favorites simply because they feel like they don’t have the money. If you have a $1,000 bankroll and your average bet is five percent of your bankroll, a -200 favorite suddenly becomes a 10 percent bet. Some bettors are scared to do that. Others are too risk-averse to do that, even though the odds of winning a five percent boost are going to be higher with a -200 bet than if you simply bet five percent to win five percent at even money.
That is why the data that John sent over was so eye-opening. There is a certain element of risk attached to every single bet that we make, but the risk declines as the juice increases. Many, however, aren’t willing to assume the higher risk. Perhaps it is time to look at things with a different mindset as it pertains to baseball.
Using the KillerSports.com SQDL database, John ran some numbers about favorites of -180 or higher since the start of the 2014 MLB season. The findings are quite incredible:
2014: 150-64 (70.1%); average line = -210.6
2015: 178-65 (73.3%); average line = -214.3
2016: 294-121 (70.8%); average line = -220.2
2017: 300-112 (72.8%); average line = -224.8
Does it surprise anybody that -180 or higher favorites won between 70.1 and 73.3 percent of the time over a four-year sample size of 1,284 games? Probably not, but this is where a proper understanding of the odds can come in handy.
The break-even rate is something that every gambler should know. For the standard -110 vig, the break-even percentage is 52.38 percent. If you win anything above 52.38 percent on all bets of -110 vig, you will show a profit. If you win anything above 54.55 percent at -120 vig, you will show a profit.
Without looking at each specific game in those sets of outcomes, here are the break-even percentages for those average lines:
2014: 67.80% (-210.6)
2015: 68.18% (-214.3)
2016: 68.77% (-220.2)
2017: 69.21% (-224.8)
By season, $100 bettors would be up $2100, $3965, $3143, and $5585 over the four-season sample size. It can be tough to lay $300 to win $100, but if the team has better than a 75 percent chance of winning in your mind or based on your simulations, calculations, etc., that is a good bet.
You’ll notice that I’ve saved the best for last. The 2018 season is a little less than a month old, so we’re surveying all games between March 29 and April 26, the date of this article. So far this season, the success rate of -180 or higher favorites is 76.5 percent in a sample size of 81 games with an average closing line of -223.1. The break-even rate of -223.1 is 69.05 percent. While this betting angle likely won’t remain as high as 76.5 percent, it is well on its way to showing a profit yet again. And, if recent history is to be believed, we should see another sample size of 400+ games.
Don’t be allergic to chalk. Value is value. The name of the game is making +EV bets based on probabilities and likelihoods. This is about as +EV as it gets.