BYU vs Utah: What we learn from the spread - cougarguard.com — unofficial BYU Cougars / LDS sports, football, basketball forum and message board

pelagius · 01-31-2007, 08:44 PM

The spread for tonight's game is BYU by 1.5 points. Currently the tradesports (http://tradesports.com) contract for BYU winning is at a bid price of 51 and an offer price of 56. So a reasonable estimate is that there is about 53.5% chance of BYU winning. Hovever, a couple of empirical facts work against BYU here that may suggest that the probability that BYU wins is lower than 53.5% (maybe more like 50/50). Levitt (2004, yes the same levitt who wrote Freakonomics) finds some important empirical patterns regard NFL betting that I will summarize with the following:

In 50% of all games 2/3 of the bets (dollars) fall on oneside of the line.
For the median game when the home team is favored, 58% of the bets (dollars) go to the home team.
For the median game when the visting team is favored, 2/3 of bets (dollars) go to the visting team.
Favorites beat the spread less than 50% of the time.
Home teams cover the spread more than 50% of the time.
Oddsmakers increase their profits by between 20-30% by taking advangtage of the "visiting team" and "favorite team" bias relative to a strategy of trying to get 50% of the money on each side of the bet.

These empirical results really only apply to NFL football betting, but it seems likely that oddsmakers do something similar for NCAA Basketball. It is possible that they don't because maybe oddsmakers don't have the same kind of informational advantage in college basketball as they do for NFL football. However, if they do then it suggests the following: The spread is probably too big because BYU is not only favored but a visiting team favorite which is where we see (at least for NFL football) the biggest betting bias. Thus my best guess is that this game is really close to a complete toss-up based on the spread.

01-31-2007, 08:44 PM	#1
pelagius Senior Member Join Date: Nov 2006 Posts: 1,431	BYU vs Utah: What we learn from the spread The spread for tonight's game is BYU by 1.5 points. Currently the tradesports (http://tradesports.com) contract for BYU winning is at a bid price of 51 and an offer price of 56. So a reasonable estimate is that there is about 53.5% chance of BYU winning. Hovever, a couple of empirical facts work against BYU here that may suggest that the probability that BYU wins is lower than 53.5% (maybe more like 50/50). Levitt (2004, yes the same levitt who wrote Freakonomics) finds some important empirical patterns regard NFL betting that I will summarize with the following: In 50% of all games 2/3 of the bets (dollars) fall on oneside of the line. For the median game when the home team is favored, 58% of the bets (dollars) go to the home team. For the median game when the visting team is favored, 2/3 of bets (dollars) go to the visting team. Favorites beat the spread less than 50% of the time. Home teams cover the spread more than 50% of the time. Oddsmakers increase their profits by between 20-30% by taking advangtage of the "visiting team" and "favorite team" bias relative to a strategy of trying to get 50% of the money on each side of the bet. These empirical results really only apply to NFL football betting, but it seems likely that oddsmakers do something similar for NCAA Basketball. It is possible that they don't because maybe oddsmakers don't have the same kind of informational advantage in college basketball as they do for NFL football. However, if they do then it suggests the following: The spread is probably too big because BYU is not only favored but a visiting team favorite which is where we see (at least for NFL football) the biggest betting bias. Thus my best guess is that this game is really close to a complete toss-up based on the spread.