NFL Handicapping: Futures Breakdown
by Robert Ferringo - 8/7/2009
"There are certain times when public opinion is the worst of all opinions."
- Nicolas Chamfort
Chamfort, an18th century French author, was a big fan of epigrams and the cornerback blitz. And his wisdom on public perception couldn’t be a more suitable lead in to discussing the grueling, sadistic endurance trial that is betting in the National Football League.
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Professional gamblers and handicappers always instruct people to “bet against the public” and the Mob Mentality that serves as the foundation for the sports gambling market. You hear it all the time: “fade the public”, “the public are suckers”, “go against the public”. But in my experience that’s the moment the advice stops and no one breaks out with specifics, statistics or any relevant proof that “fading the public” is anything but a gambling urban legend.
But never fear, your capper is here.
The reason that you want to go against the public is because the oddsmakers are surgically skillful at turning misperceptions about teams, players and games against the general public. Therefore, to stay ahead of the game you must be able to separate from The Mob and rely on logic and facts (along with you own instincts) and let that trump what “everyone” thinks.
And in my opinion there is no more perfect battleground for this conflict of conception than in the NFL futures market.
NFL futures rely on equal parts statistics and perception. And while sportsbooks and firms like the Las Vegas Sports Consultants excel at manipulating opinions against us I think that we can turn the tables and use their mathematical mastery against them. The idea is simple: if you bet on simple regression – both positive and negative – on teams that show a statistically significant performance against the preseason Las Vegas season wins expectations then you can beat the NFL futures market.
Basically, each NFL season there are “overachievers” and “underachievers”. The overachievers usually start to be overvalued and inflated by the general public, while the underachievers are left for dead in a wasteland of public perception. But if you bet on those underachievers and if you bet against those overachievers with futures bets the next season you will clean up.
So how do we really decide whom the overachievers and the underachievers are? That’s where we turn the LVSC’s skill against itself. To make our determination we will use Vegas’s own preseason NFL wins totals to determine our group of plays.
Over the last four years the average NFL team comes within +/-2.7 wins of its Vegas season wins total. I don’t want to give you horrid flashbacks to algebra class, but when you consider standard deviation and normal distribution the key number in this situation for gamblers becomes four wins; Any team that either surpassed or came up short of their Vegas wins projections by four or more wins fits into our profitable futures betting system.
Since 2005, teams that won four or more games than their preseason over/under number went just 2-14-1 against the wins over/under the following year. Conversely, teams that were short of their over/under season wins total by four or more games bounced back to go 14-4 against their projections. So if you had played ‘under’ for all of the “overachievers” and ‘over’ for all of the “underachievers” you would have gone 28-6-1 with futures over the last three years. That is a sensational 82-percent success rate and dime bettors would be up around $21,000.
This method doesn’t just make mathematical sense but it’s common sense as well. Teams that “come out of nowhere” for a big season usually have a lot of things break their way. Injuries, turnovers, strength of schedule and a few lucky bounces or fluke calls can make the difference between a team in the playoffs and one picking in the Top 10 of the draft. And since over 90 percent of the overachieving teams went to the playoffs the perception becomes that these clubs are the class of the league. The public overvalues these teams, the books set a slightly inflated season win total based on that misperception, and then the books clean up when everyone overestimates their value.
For example, in 2006 Green Bay was a very average 8-8 squad. In 2007 the Packers caught fire, had some breaks, won some close games and finished 13-3, a full six wins over their preseason wins total. Everyone expected big things from them in 2008. But, naturally, they regressed to 6-10 and went ‘under’ their preseason projection of 9.0 wins.
The flip side is also true and NFL organizations have shown a tremendous ability to bounce back from horrendous seasons. And while the public may ignore the contributing factors and extenuating circumstances – it’s easier to just say a team sucks – the resultant lowered expectations provide a ripe betting opportunity.
Baltimore is a great example. This team went 13-3 in 2006 and surpassed their Vegas projections by a full six games. Their expectations were inflated to 10.0 projected wins heading into 2007. A rough schedule, some tough losses, and a load of injuries contributed to a 5-11 season that went ‘under’ by a full five games. Then sure enough, the Ravens entered last season with a season wins projection of just 6.0, which they easily surpassed on their way back to the playoffs. That was an easy ‘over’ based almost entirely on warped public perceptions (and our key number of four from the previous year).
There are plenty of other examples: In 2007 Atlanta was four games under their wins total. They came back and went over last year’s number by seven wins. The 2007 Browns went over by four games and last year went under by four games. And so on.
In 2008-09 there were 12 teams on the extreme ends. The “overachievers” were Atlanta (7 more wins), Baltimore (5), Carolina (5), Miami (6), the New York Giants (4) and Tennessee (5). That means you want to bet the ‘under’ on their season wins total this for this fall. Our “underachievers” were Seattle (5 less wins), St. Louis (5), Kansas City (4), Jacksonville (5), Detroit (7) and Cleveland (4). Entering the 2009-2010 season we are going to want to bet ‘over’ on this latter group. And if the three-year percentages hold true you should hit either nine or 10 of the 12 futures wagers you place.
However, “fading the public perception” is not just relegated to bad teams becoming good and vice versa.
Each year there are 12 teams that survive the harsh realities of an NFL regular season and manage to secure a place in the postseason. Since 2004 there have been 60 individual playoff teams and, since the 2008 performers haven’t had a chance to defend their perch on the NFL totem pole, there have been 48 teams with an opportunity to repeat their postseason berth the following year. Of those 48 teams only 19 – or roughly 40 percent – actually made it back to the playoffs the following season.
Not only that, but those 48 teams were a horrendous 18-28-2 against their season win totals O/U the following year.
So five of the teams that were crunching skulls in the playoffs last season will be back in the cage again next January while the other seven clubs will be bloody carcasses strewn by the wayside. And if the numbers hold then either seven or eight of last year’s 12 playoff teams will go ‘under’ compared to their season wins total.
Further, if you exclude the incredible runs of success sustained by the Indianapolis Colts (4-for-4 in return postseason trips and 4-0 against season win totals), the New England Patriots (3-for-4 and 2-2) and the San Diego Chargers (3-for-4 and 2-1-1) then the rest of the league is a pathetic 7-for-36 (19.4 percent) in terms of playoff teams making a return trip to the postseason the following year and just 10-25-1 (28.6 percent) against their season wins projections for the following year.
That means you should take the playoff teams from last year and bet on the ‘under’ for their season wins total this summer. Over the last four years that simple futures system has sustained a 71.4 percent success rate. And even if you were to include those three “dynasties” you would still be collecting on 61 percent of your wagers and dime bettors would have banked around $8,000 with a 17 percent return on investment. Try getting that on Wall Street these days.
And if you combine the two “fade the public” systems that we’ve discussed you would have gone 56-24-1 over the last several years and dime bettors over that time would have brought in around $30,000.
Futures odds are set based on equal parts stats and public opinion. We don’t have to understand the stats to use them effectively. And since the public consciousness is usually ill informed, unsophisticated and reactionary we can use that to our advantage as well. By going against the public opinion of “good” and “bad” teams and by basing your plays on stats over supposition you can make a boatload of cash with a great long-term futures investment.
Carpe diem, my friend. And good luck.
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