The best bet I ever made: Laying $9,500 to win $380

The best bet I ever made: Laying $9,500 to win $380

Ask a winning sports bettor how you can win too, and the answer will likely involve the concept of VALUE. Our poker playing cousins call it +EV, and the casino floor talks about “theoretical hold” (the cool kids call that “theo”). Ultimately the concept is the same: over the long-term certain plays will win money – and certain plays will lose money. So really, when you are told to find value, you are being told to find winning plays. This would be similar to asking Warren Buffett how to invest, and him saying: “buy stuff for less than it’s really worth.” Sure, the concept is easy - but the ability to properly power-rate teams and thus effectively identify value in match-ups is extremely rare. That’s one of the main reasons why over 95% of sports bettors lose over the long run (ruinous money management is another culprit).

So, many thoughtful sports bettors search for short cuts. One is to find a handicapper with the rare talent to indentify genuine value, and follow him. Another is to gravitate to situations which historically have offered value. For example: Underdogs or Unders. I personally believe in this approach: I always start with a bias for the dog, and a bias for the Under. I strongly believe with disciplined line shopping and a bias toward dogs and unders a player can break even with no other special talent. But, the step from 52.4 to 55% requires the ability to know which underdogs and which Unders to avoid.

But, like the fat guy who thinks the way to get thin is by wearing gym clothes, I think that people are focused on a characteristic of the cause, and not a cause itself.

The message of this article is that underdogs and Unders are characteristics, but the cause of value is making bets that the public finds DIFFICULT to make. Here’s where the overlap happens: the public finds it difficult to bet the worse teams, so they don’t often bet dogs; the public doesn’t enjoy spending the entire game rooting against scoring, so they find it difficult to bet Unders.

The noteworthy distinction of this “Make Difficult Bets” theory is the times when the difficult bet is NOT the underdog or Under. For example, with two teams known for defense, often times the more difficult bet is going over the 36. Or when a ranked college football team is a small underdog on the road vs. an unranked team, the more difficult bet is laying the points against the marquee team. Once again the difficult bet is where the value is, and in these unusual cases it’s on the favorite and the over.

An important example is big money lines. The public does not find it easy to bet a lot to win a little. Boxing is a great example: on fight night the -700 favorite will often drift down to -550 because the public does not want to bet $70 to win $10. A similar example is the money line on the Super Bowl: typically the Super Bowl ML is significantly deflated because the once-a-year bettors bet the dog on the ML because they want to win more than they risk. The sharpest bettors take advantage of these biases.

What is especially noteworthy is how the money line concept runs contrary to the underdog theory. A few months ago in the Pregame.com forums a poster who knew just enough to be dangerous lambasted another poster who was playing big favorites on the money line. The conversation went something like: “only squares lay big money lines.” Wrong. Only squares bet what is easy.

Now, onto the best bet I ever made!

Jimmy Vaccaro is my kind of bookmaker – a Pittsburgh guy with 30+ years in the business, and he’s got gamble in his bones. (Here’s my recent podcast with Jimmy). As the manager of Lucky’s sportsbooks, he put up the following prop this week: Will the Lions go 16-0? Yes: +1600, No: -2500.

The NO seemed way low to me; so I got out my calculator. Defining value was easy in this case since some sportsbooks have lines up for all future NFL games (so in a way this is an arbitrage between different markets on the same event). Said another way, the market has defined what Detroit’s chances are of winning each of the next 11 games: first, I took the pointspread, converted it to a money line, and converted the ML to a percentage chance of winning the game.

Remaining Lions Schedule:

-4 vs. SF (.66%)
-6 vs. Atl (72%)
-3 vs. Denver (60%)
-1 vs. Bears -1 (52%)
-9 vs. Panthers (82%)
+3 vs. Packers (40%)
+6.5 vs. Saints (26%)
-9.5 vs. Vikings (83%)
-1 vs. Raiders (52%)
-3 vs. Chargers (60%)
+7.5 vs. Packers (20%)

The odds of Detroit winning the next 11 games? .0695%. That’s 1/14th of 1%. That’s 1,438 to 1 against.

So Lucky’s is paying $1 on every $25 risked while the odds say they should pay $1 on every $1438 risked. That’s 57 TIMES what’s deserved – talk about a margin of safety!

Looking at it another way, 25 to 1 assumes 4% likelihood, while the odds of Lions winning their last 5 games only is 1.4% (so we have a margin of safety there, and 6 games free-rolling!)

Let’s knock out the disclaimers: a) if Detroit keeps winning, the lines on the later games will logically favor Detroit to a greater degree; b) if a big bet at 25 to 1 that may not cash for months stops you from making many other +EV bets in the interim, that must be considered; c) time value of money must be considered with a big outlay [though with interest rates as low as they are, that’s less of a factor; and to Lucky’s great credit, they are paying on the NO as soon as Lions lose, rather than waiting till the end of the season]; d) money line conversions from point spreads have some variation.

The beauty is that the margin of safety is so amazingly great, the small uncertainties – even if they all went to our disfavor – wouldn’t change that this is still a great bet. And if somehow the Lions win the next 6 games, we can start hedging with 5 games to go – making this literally a CAN’T LOSE BET.

Why does the smart bettor have this opportunity? Because Lucky’s is willing to gamble, and knows that the average player will not make the hard bet (laying $25 to win $1). There’s an important lesson in that for every bettor.

The best bet I ever made . . .