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HILTON NFL CONTEST -
A BAD BET
© Robert Crowne &
Assoc., Sept. 10, 2010
Note: The Las Vegas
Hilton Supercontest is a trademark of the Las Vegas Hilton.
The Hilton Supercontest has been
peopled, in the main, by
- existing
sports services trying to make a reputation for themselves,
- entrants
seeking to launch a sports service career based on the publicity they hope
to receive, and
- those
who pay the $1500 entry fee in the hope of making a substantial profit by
finishing in the Top 20.
I've been asked many times why I don't enter the Hilton's
contest. The reason is that, in my
opinion, the contest is a bad bet, and a poor allocation of business
capital.
What is the Supercontest?
Although the Hilton calls it a contest, the NFL Supercontest
is actually a betting pool no different from the pools that might be run by
your local sports bar. The "entry fee"
is actually a bet by each entrant that he will win more games than every other
entrant. The actual number of games
won doesn't matter. In theory, the
winner could have a losing record overall if everyone else has a worse
record. Likewise, someone with a 65%
record could lose if 20 of the other entrants finished with higher winning
percentages.
The required bet has been set at a substantial $1500. For those investing in the pool to make a
profit, the bet is substantial enough to require an examination as to whether
the Supercontest is a good bet. For the present and future sports services,
that amount is substantial enough to warrant an examination as to whether the
Supercontest is a good business investment.
Betting Aspects of the Contest
A good bet is defined as one at which a skilled
player can gain a substantial enough edge to warrant the risk, or one which
provides a sufficiently substantial edge in the odds. In addition, no matter what the edge, to be a good bet it must be
capable of being won with sufficient frequency to make the risk a good business
investment. For example, if the payout
on a lottery is $20 million to $1, and the odds against winning are 19.5
million -1, the odds provide an edge.
Investing $1500 in tickets would lower the odds against you to 13000-1,
but the probability is still substantially against ever winning in your
lifetime. In such case, despite the
advantage in the odds, risking $1500 in the lottery may not make good business
sense.
The Hilton Contest fails to qualify as a good bet under any
of the stated criteria.
(a) Contest Results Cannot be Handicapped in Advance
Luck is the enemy of the skilled handicapper. If you have an edge and remove all luck,
there is a certainty that you will win the amount of your edge over time. It is only luck in the short term that can
make your return uncertain. The skilled
handicapper controls whether he wins or loses.
The more the skilled handicapper is subjected to luck, the less control
he can exert.
It can be said that because the skilled handicapper has an
edge, he is like the casino or the bookmaker.
He is not gambling; he is in business.
He wants certain returns on his business investment. Luck makes the returns uncertain.
For the skilled handicapper, being subjected to luck means
being subjected to unknowns that cannot be predicted in advance.
The Hilton Contest adds three elements of luck to the
handicapper's equation; and those elements of luck are not merely incidental, but are the main
factors in determining whether the contestant wins or loses.
First, in normal sports betting, the proposition is that the bettor
will win the individual bet, and overall that he will win more individual bets than he loses. The
result of these propositions is capable of being controlled over time by applying
one's skill to handicapping the teams.
In the Hilton Contest, the main betting proposition is that
you will beat all the other contestants, or at least all but 19 of them. As stated earlier, how many games you
actually win or lose doesn't matter, so long as you have more winners than the
other contestants. Last year, the
contest winner had a 64.8% won-lost record.
In other years, it has required over 67% to win.
In the 2009 season, the second place finisher had the same
number of winners as the 1st place finisher, but had the misfortune
of having one game lose rather than push.
That half game difference cost the 2nd place finisher $118,000 in prize money.
Any of the other contestants can beat you with skill, or by
luck, or with some combination of both.
Steve Fezzik is the first person to ever win the contest twice in a
row. To his credit, he attributes his
wins to a great deal of luck. He
has emphasized that the percentage he hit was not a realistic expectation. The effect of luck can be seen in the fact
that Fezzik ranked all the way down in 61st place halfway through
the season, and wound up winning the contest.
The problem for each entrant is that the skill and luck of the other
contestants cannot be handicapped. The
main betting proposition is a complete unknown. The Hilton Contest situation is similar to betting a horse race without knowing what
horses, or even how many horses, are running.
In a horse race in which the horses are unknown, every horse must be
considered to have an equal chance of winning.
Likewise, before the Hilton Contest starts, every contestant must be
considered to have the same chance of finishing in any given spot. The final
placing in the Contest depends completely on the unknown factors of skill and
luck of the other contestants.
Secondly, the contest requires that exactly five sides be
picked each week in the NFL only. Since
there are 13-15 games every week, the probability is 92.3% that any given
handicapper will like more or fewer than five sides in any given week, and only
7.7% that he will like exactly five sides.
If the handicapper likes fewer than five teams, he must force the extra
selections and will be subject to luck on those selections. If he likes more than five teams, he must
eliminate some games and becomes subject to luck of the draw on the five he has chosen.
Thirdly, the exact amount of the prize, and the odds against
each contestant are also unknown and therefore subject to luck.
The amount of money to be distributed is based on the total number of
entries, which cannot be known until after the entry fee has been paid and the Contest is closed. In other words, the contestants are betting
blind without knowing the odds against them or the payout odds. In 2008 the top prize was $13,000 higher
than in 2009. That's an almost 9-1
difference in odds.
Further, there is a tiebreaker only for the top spot. In 2009, the 3rd place finisher
was only one winner in 85 games behind the 2nd place finisher. If the 3rd place contestant had
one extra winner, there would have been two 2nd place finishers, and
the 2nd place prize would have been divided between the two of
them. If there are more than two people
tied for second, the second place finishers could receive less than the 3rd
place finisher. In that instance, the
final 3rd place finisher would have been moved up to 3rd
from 5th, and receive 100% more prize money, solely as a result of
the 3-way tie above him. Whenever a tie
occurs, the results for every bettor at or below the level of the tie are
substantially changed by the luck of the tie.
Ties in the top 20 prize spots are not uncommon.
(b) The Odds Do Not Provide any Edge
Since it is impossible to handicap the final position in the
contest, the only edge must come from the odds. Many bettors believe that the average $200,000 payout on a $1500
bet, and the fact that all the entry fees are paid out in prize money make the
contest a good bet. Nothing could be
further from the truth.
As stated above, the most important factor in the contest, the
skill and luck of the other entrants, is a complete unknown. The odds must, therefore, be calculated as
if every entrant in the contest has an equal chance of winning before the
Contest starts.
There were 328 entries in the 2009 contest. Based on that, the odds against any entrant
winning were 327-1. The $1500 entry
fees totaled $492,000.
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For the odds of winning 1st place to
have been breakeven, the top prize had to be $492,000. Instead, the winner received only
$196,800 The effect to
the winner is the same as a 60% rake.
The difference between the Hilton Contest and any lottery is that,
instead of pocketing the 60% commission, the Hilton distributes it to
contestants finishing from 2nd to 20th. That gives each of the contestants a better
chance of winning something, but the payout is insufficient in any spot.
Last year's first prize of $196,800, including the contestant's own
$1500, represents a payout of only 130-1 on a 327-1 proposition. Below is a chart showing the true odds
against finishing in spots 2 through 20, the maximum payout in 2009 for a
finish in each spot, and the payout
odds represented by the maximum payout.
The payout odds in the chart assume there are no ties. :
Finish
|
Odds Against
|
Payout if no ties
|
Payout Odds
|
|
2nd
Place
|
326-1
|
$78,720
|
52.5-1
|
|
3rd
Place
|
325-1
|
$39,360
|
25-1
|
|
4th - 6th
Place
|
108-1
|
$19,680
|
12-1
|
|
7th - 10th Place
|
80-1
|
$17,220
|
11.5-1
|
|
11th -
20th Place
|
32-1
|
$ 4,920
|
3-1
|
As you can see, the odds against finishing in any given prize
category are substantially higher than the payout odds.
The full payout of
fees is reflected in the fact that the odds against winning any full prize at
all are 15.4-1, and the average payout odds for all spots is also 15.4-1. On that basis, the Hilton Contest is a no-edge,
breakeven luck bet because the house does not cut anything from the pot, but instead distributes the entry fees among 20 or more contestants. The major benefit, however, arises from finishing in one of the top three spots, and the payout does not compensate for the odds against accomplishing that..
The problem arises from the fact that no entry can win more
than once, and there is a substantial rake taken by the other winners. Since, before the contest starts, the chance of being in any given position in the top 20 is equal, creating a truly breakeven proposition would require that all the prizes be equal. The varying payouts cause the breakeven to exist only after the same number of trials as there are contestants,
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or in other words, when the number of
contestests entered equals the odds against winning in any given position
In the long term, if a bettor continues to enter the Hilton Contest every year, the bettor would eventually receive every prize and the prize money would exactly equal the entry fees. The Contest is only run once per year, however, and there are an average of 350 entrants every year. Theoretically, winning every prize would take playing in 350 contests over 350 years. The bettor can never reach the long term in the Hilton Contest, and the odds in the short term are insufficient because a rake is taken by other players. Stated differently, the bettor will not live long enough to be the recipient of his full share of the rake. If the payout were equally divided among 20 winners, then the payout would always equal the odds of winning a prize, and the bet would be a breakeven proposition in the short term as well as in the long term. That, however, is not the payout structure.
Another negative factor arises from the fact that there can be an unlimited number of ties in
any spot except first place. In theory,
after the first place finisher is determined, all remaining contestants could
finish 2nd through 20th.
Last year they would have represented 327 contestants, or 99.97% of all the entrants finishing 2nd through 20th.
If that had happened, after the 40% was paid to the winner, there
would have been only 60% of the pool remaining to be paid to 99.97% of the contestants. That means each entrant would be guaranteed to receive less than they bet. Winning and receiving less than you bet
could never happen in a pari-mutuel pool or at the bookmaking window.
The problem lies in the fact that an unknown number of winners must be paid from a fixed pool, and the percentage of the pool taken by the first place winner is fixed. The result is that even after winning every prize over 350 years, a bettor still may not receive a return of all his entry fees due to the occurrence of ties.
(c) The Expected Frequency of Winning is Insufficient
Even though all contestants could, theoretically, qualify
for a prize, don't count on getting any prize at all, even less than you
bet. Last year you would have had a
94% (308 in 328) chance of losing your whole $1500. The odds against getting the top prize are 327-1. Since the contest is run only once per year,
the player can expect to finish first once every 327 years. The odds against a 2nd place finish and a 3rd
place finish are the same as for a 1st place finish.
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That two people have managed to win the Hilton Contest more than
once means no more than that a woman hit the Megabucks slot jackpot twice in
two days, and a man won the top prize in the NYS lottery twice in two years. Winning the Hilton Contest twice is a 107,000 to 1 shot. If 107,000 to 1 shots never came in, no one
would every win a State Lottery. Those
multiple-win occurrences are a part of random selection, and their existence does not make the
slot machines, the NYS Lottery, or the Hilton Contest good bets, nor prove that
they are games governed mainly by skill rather than by luck. .
In the hope that their one win in 327 years would come in 2009,
contestants took the 94% chance of losing everything despite having no
advantage in the odds, and no advantage that could be calculated in advance based on
skill. That's not a risk I believe to
be smart.
The question remains, whether the risk at breakeven is
worthwhile for a sports service as a business investment for the publicity.
Business Aspects of the Contest
There at two possible benefits for current or future sports
services. Those are, the creation of an
independent record, and the possibility of free publicity. if the service
wins. The latter is probably the more
important consideration.
There are many less expensive, more complete, and more
accurate ways of documenting selections than paying a $1500 contest entry
fee. The limitation of the contest to
NFL sides, the requirement that there must be exactly five selections every
week, and the requirement that those selections be made at least two days
before the games are played, makes the contest an inaccurate measure of the
handicapper's skill.
Additionally, in the final weeks, the selections for those on the bubble
must be based on contest considerations rather than handicapping. In 2009, Fezzik was still attempting to
catch up in the final week. The only
way to be sure of overtaking the leader was to pick opposite him and win. The only way for the leader to be sure of
remaining in front was to try to pick at least three sides that were the same
as Fezzik's picks. During an interview with
the Las Vegas Sun,. last year's winner, Fezzik, said, "I data mined my opponent
and noticed that he played a lot of four-to-seven point underdogs." Based on that Fezzik believed the leader at that point,
Big E, would pick Seattle, and Fezzik chose Seattle's opponent, Tennessee. Big E did take Seattle, and Tennessee got
Fezzik 1st place by ½ game.
End-game picks in the final weeks have less to do with handicapping
skill than with tournament skill.
From a publicity standpoint, there may be some benefit to a
finish in one of the top three spots, but the real publicity value comes from
being #1. Those who desire to enter the
sports service business on the strength of their Hilton Contest performance
will quickly discover that the public doesn't care about a 10th
place finish. Why pay the guy who
finished 5th when you can pay the guy who finished first or
second? If the 1st place
winner is not already in the sports service business, you can bet he'll be getting offers from
the big boiler room operations.
Further, only the winner gets free publicity from the news
media and the Hilton. Do you know the
name of the #2 and #3 finishers from last year or the year before? A handicapper who does not finish first will
need to spend just as much money advertising his lower-place finish as he would
need to spend if he had never paid the $1500 to enter the Supercontest.
If I spend $1500 on well-chosen conventional advertising, I
am certain of a profitable return. If I
spend $1500 on a 327-1 chance that I will get free publicity from the Hilton
Contest, I have a 99.97% chance of getting nothing for my money. Entering the Hilton Contest instead of
buying conventional advertising is not a wise business decision.
A Creative Solution
I have arrived at an idea so simple that I can't believe it
took 20 years to dawn on me. I can
enter the Hilton Contest without violating my principles by making a bad bet,
get all the same business benefits I am likely to get from the Hilton Contest,
and make money at the same time. I
don't need to donate prize money to 19 or more other Hilton contestants, and I
don't need to pay $400 plus 1% of any prize money to a proxy in order to have my selections entered for me in Las Vegas every week.
I also don't need to spend time and money traveling to the Mojave desert
in the 130 degree heat of August to enter the Contest in person, as required. Instead, I can post my five Hilton
selections every week right here at Pregame.
Whether I put the selections up free in the forum, or in a pay package,
will depend on several factors including how I've been doing, and how I feel
about the selections that week.
Periodically putting the selections in a package will help
to avoid the problems that arise from publicly posting selections every week
that members of the Crowne Club have paid to get, and it will help me to earn
some money from my effort. The benefit
of the pay packages over my free posts and over the selections of others in the
contest is that I will rate them so that you know which plays are real, which
may be weaker or simply forced, and toward the end of the contest, which
selections may merely be strategic.
A substantial number of weeks will be free. I will keep track of the free selections and
the posted selections in the forum, and of course you can track the free
selections yourself and the pay selections by going to my page /pregamepros/pro-bettor/bettor.aspx?id=4441#daily_msg
If I happen to finish with a record that would have placed
me in the top three places in the Hilton Contest, you can all attend, free of
charge, as a I cut off my own head with a ceremonial samurai sword in the
parking lot outside the door to the Hilton Sportsbook. Refreshments will be
served.
If I finish anywhere in the top 20, I would be forever
grateful if all of you thank me by
going forth on the Internet and publicizing my accomplishment in as many places
as possible..
If this is Friday or Saturday, the picks are posted in a thread in the
NFL section of the forum under the heading "Rob Crowne Hilton Picks" or in a
package on my pick page. Picks will be posted by the Saturday, September 12, 2010 Hiltoin Contest entry deadline, and by the deadline each week thereafter.
Disclaimer: My
selections to Crowne Club members and in late packages are often based on
professional syndicate action, or on late game information including weather
and injuries. My selections for the
contest may be made for strategic tournament reasons rather than handicapping
reasons. Thus, my posted Hilton
selections may be different from or even opposite my service selections.