Millman on Placing Wagers Late

From Millman's latest column:

Bet early in the week and you are essentially betting against an oddsmaker who, with advice from some consultants and his staff, puts up what he considers to be the best number. Bet late in the week and you are betting against the collective IQ of hundreds of wise guys who pounded the value out of the number within the first 48 hours it was up. It's essentially like buying stock in Apple a week after the iPhone comes out, because you really want a chance to research it. Meanwhile, the pros on the Street made their money the first 24 hours and then cashed out.

Which I agree with for the most part. However, for the contrarian, the analogy fails. In the stock market, you don't have a bunch of people coming in and betting against the iPhone after it is released. If that were the case, you would create a market inefficiency between the true and perceived values of Apple. In the sports market, that inefficiency exists and can be leveraged if properly identified.

And that's why I believe contrarianism works. At least for now.


AJ said...

That doesn't make much sense. If you wanted to bet against Apple, you could short Apple. There are people whom are constantly exploiting market inefficiencies.

Even if I took what you said to be accurate, I don't quite understand the link or the point you are trying to make.

Lou said...

IMO, If we could predict where Vegas is deciding to take a side when the lines come out, we'd do better. Moreover, early in the week, MB markets are absolute garbage. I'll take a slightly worse line for better information as the week goes on...

Then again, this is a world in which most people are paying -110, so I'll take my liquid MB market on a Sunday morning with a good deal of betting & line movement info vs. trying to make guesses and hoping to get a better price, that might not even be that much better than what I'd end up with on MB.

And the Apple analogy is fairly retarded.

am19psu said...

Hi. I have never invested in the stock market or taken an economics class. Does it show?

The only point that I was making was that squares create market inefficiencies that contrarians (and to a lesser extent sharps, but they aren't looking at it the same way) can take advantage of.

I blame Millman.

Gamblor said...

I think you can look it from the sharps perspective and see how it all works.

SIDES: If the sharps like a favorite, they bet it early and often (see Steelers last week v. SD). They realize they may not get their number later in the week IF the public also likes that same favorite. They rare lose in this scenario - if the public keeps betting on the fave they like, they can hedge late on Sunday and grab the **tasty** middle. If the public likes the other side, the books will hold the line. There's money to be made and the books will clearly side with the sharps.

If the sharps like a dog...well, they will probably wait (much like a contrarian). Double digit dogs are almost automatic plays for the sharps (hitting a profitable 52% LT, last week's results notwithstanding). They always figure they'll get those numbers better later on in the week, and they are almost always right.

If I were an off-shore, I would never release my NFL lines until a few hours after Vegas did (which they probably do)- that way I could see the lines meted out and save myself the risk of losing $$ to the sharps while still getting that beautiful public dough.

On a related note, I can't stress enough how important Matchbook is to destroying the high vigorish and high profits of off-shores. It really is a libertarian's wet dream - a vibrant market with contracts that are ruthlessly enforced - while paying suppliers of the market a fee. How awesome is that???