Betting the underdogs in April
Chad Millman
ESPN INSIDER
The MLB standings look a little cockeyed, right?
Nice work, Seattle Mariners, sneaking up on us like that and starting the season 4-4. Didn't we have you down for oh-fer by now? And the Toronto Blue Jays, starting 4-2 and tied for first in the American League East. This one, I am proud to say, we saw coming at the blog, pointing out that the sharps had been betting the Jays' season win total up all during their excellent spring training. And let's meet the 4-2 New York Mets. Just 68 more wins and they too will have made the sharps look sharp by winning 72 games, one more than their projected season win total.
<offer>All across fandom, the conversation is about hot starts by teams no one expected to be starting hot at all. The Los Angeles Dodgers are 6-1, clearly trying to make sure the team is worth one-quarter of the investment Magic Johnson made in them. Even the Houston Astros, the worst team in baseball, an embarrassment of a franchise, a team that looked in the tank before pitchers and catchers applied suntan lotion, have started the season 3-3.
On the flip side, look at some of the preseason playoff faves. The New York Yanks struggled to a .500 start. So have the Philadelphia Phillies. The Los Angeles Angels are 2-5. And let's not even talk about the 1-5 Boston Red Sox. Seriously, if we do, Bobby V is likely to find us and make us stop.
I am not going to say, less than two weeks and 10 games into a six-month, 162-game season, that the Baltimore Orioles, Jays and Mets will be playing in September while the Angels, Phillies and Yanks will all be sitting on their trillions in collective payrolls. But I am going to say that an interesting betting trend regarding baseball underdogs is, once again, in play early this baseball season.
Baseball is about understanding value in the money lines -- bet $100 on a team at plus-150 and win, and you get paid $150; bet $100 on a team at minus-150 and win, and you get paid $67. The beauty of money-line bets is that, if you know value and play underdogs, you can make money by winning at a lower percentage than the standard 52-plus percent necessary when betting against the spread.
This is why wiseguys love baseball and why so much of the public stays away. Few of you sitting at your desk reading this want to spend the time required to understand if the Chicago Cubs at plus-175 against the St. Louis Cardinals at minus-190 is a good value. If you are itchy, you'll pull the trigger on the Cards, no matter how high the line. But pros are more likely to pass. Many of them, knowing money-line math, won't bet a game in which the price for the favorite is higher than minus-150.
"This is all psychological," says Geoff Kulesa of wunderdogsports.com. "Unlike betting against the spread, betting the money line requires bettors to actually choose an underdog to win rather than just cover. It makes for a completely inefficient market that bookmakers can get away with. They know a fair price on the Yankees might be minus-150 and they know bettors will jump on that, so instead they put them at minus-170. But that means the value on the 'dog increases."
Historically, early in the year is when the value on the 'dogs is at its highest. Kulesa is a system handicapper who culls years of data to find betting trends. He has tracked eight years of stats on early season baseball 'dogs. The results he's discovered are pretty interesting.
Since 2004, if you blindly bet $100 on every favorite in the month of April, you would be down $26,000, an average of $3,250 per year. If you flipped that and blindly bet every 'dog, here's the year-by-year breakdown:
2004: $2,000
2005: $800
2006: $300
2007: $100
2008: $3,200
2009: $2,600
2010: $800
2011: $3,200
I'll add it up for you: It's a net of $13,000.
Let's look at this season. According to Kulesa, the 'dogs were 13 games under .500 through Wednesday. But the total losses on those bets, thanks to nice payouts on wins, were less than $300. Meanwhile, because of the cost of money-line payouts for favorites, betting those teams and winning 13 more games would have put you in the red as well, just under break even.
"People don't like winning just 50 percent," says Kulesa. "They don't like seeing half their bet lose. But when you bet baseball, you can't care about winning percentage; you have to worry about net profit. The way this trend plays out, I like my chances of finishing on the plus side by the end of this month."
Of course, this will change. As sure as the Yankees will rebound, the Angels will find their groove and the Mets will come back to earth, this window will close. Kulesa says it's in June, when pretenders realize they don't have the chops and contenders decide to get down to business.
Which one will you be?
</offer>
Chad Millman
ESPN INSIDER
The MLB standings look a little cockeyed, right?
Nice work, Seattle Mariners, sneaking up on us like that and starting the season 4-4. Didn't we have you down for oh-fer by now? And the Toronto Blue Jays, starting 4-2 and tied for first in the American League East. This one, I am proud to say, we saw coming at the blog, pointing out that the sharps had been betting the Jays' season win total up all during their excellent spring training. And let's meet the 4-2 New York Mets. Just 68 more wins and they too will have made the sharps look sharp by winning 72 games, one more than their projected season win total.
<offer>All across fandom, the conversation is about hot starts by teams no one expected to be starting hot at all. The Los Angeles Dodgers are 6-1, clearly trying to make sure the team is worth one-quarter of the investment Magic Johnson made in them. Even the Houston Astros, the worst team in baseball, an embarrassment of a franchise, a team that looked in the tank before pitchers and catchers applied suntan lotion, have started the season 3-3.
On the flip side, look at some of the preseason playoff faves. The New York Yanks struggled to a .500 start. So have the Philadelphia Phillies. The Los Angeles Angels are 2-5. And let's not even talk about the 1-5 Boston Red Sox. Seriously, if we do, Bobby V is likely to find us and make us stop.
I am not going to say, less than two weeks and 10 games into a six-month, 162-game season, that the Baltimore Orioles, Jays and Mets will be playing in September while the Angels, Phillies and Yanks will all be sitting on their trillions in collective payrolls. But I am going to say that an interesting betting trend regarding baseball underdogs is, once again, in play early this baseball season.
Baseball is about understanding value in the money lines -- bet $100 on a team at plus-150 and win, and you get paid $150; bet $100 on a team at minus-150 and win, and you get paid $67. The beauty of money-line bets is that, if you know value and play underdogs, you can make money by winning at a lower percentage than the standard 52-plus percent necessary when betting against the spread.
This is why wiseguys love baseball and why so much of the public stays away. Few of you sitting at your desk reading this want to spend the time required to understand if the Chicago Cubs at plus-175 against the St. Louis Cardinals at minus-190 is a good value. If you are itchy, you'll pull the trigger on the Cards, no matter how high the line. But pros are more likely to pass. Many of them, knowing money-line math, won't bet a game in which the price for the favorite is higher than minus-150.
"This is all psychological," says Geoff Kulesa of wunderdogsports.com. "Unlike betting against the spread, betting the money line requires bettors to actually choose an underdog to win rather than just cover. It makes for a completely inefficient market that bookmakers can get away with. They know a fair price on the Yankees might be minus-150 and they know bettors will jump on that, so instead they put them at minus-170. But that means the value on the 'dog increases."
Historically, early in the year is when the value on the 'dogs is at its highest. Kulesa is a system handicapper who culls years of data to find betting trends. He has tracked eight years of stats on early season baseball 'dogs. The results he's discovered are pretty interesting.
Since 2004, if you blindly bet $100 on every favorite in the month of April, you would be down $26,000, an average of $3,250 per year. If you flipped that and blindly bet every 'dog, here's the year-by-year breakdown:
2004: $2,000
2005: $800
2006: $300
2007: $100
2008: $3,200
2009: $2,600
2010: $800
2011: $3,200
I'll add it up for you: It's a net of $13,000.
Let's look at this season. According to Kulesa, the 'dogs were 13 games under .500 through Wednesday. But the total losses on those bets, thanks to nice payouts on wins, were less than $300. Meanwhile, because of the cost of money-line payouts for favorites, betting those teams and winning 13 more games would have put you in the red as well, just under break even.
"People don't like winning just 50 percent," says Kulesa. "They don't like seeing half their bet lose. But when you bet baseball, you can't care about winning percentage; you have to worry about net profit. The way this trend plays out, I like my chances of finishing on the plus side by the end of this month."
Of course, this will change. As sure as the Yankees will rebound, the Angels will find their groove and the Mets will come back to earth, this window will close. Kulesa says it's in June, when pretenders realize they don't have the chops and contenders decide to get down to business.
Which one will you be?
</offer>
