With the college bowl season nearly upon us, Vegas (and other) odds-makers are doing serious business. In spite of being illegal in most places, Americans love to gamble. If not placing a bet in Vegas, or via an online gambling facilitator such as GamblingInsider.Ca, people are participating in bowl pools with their friends or at work.
Knowing how to look at odds can help you do better in those pools. As an individual, people are rarely in possession of enough information to make an informed decision about which teams are likely to perform well in a bowl. Crowdsourcing information, on the other hand, can help.
Crowdsourcing is the theory that groups of people—each acting on their own available, but limited and independent information— often produce better results as a group than the “experts.” (For more on this, read James Surowiecki’s The Wisdom of Crowds). It has been suggested that betting odds are a good example of crowd-sourced information, since oddsmakers adjust the numbers as bets are placed on one side or the other to ensure that there is a balance. If the bets are balanced, the bookie makes money regardless of the outcome—the “vig.”
Depending upon where you look, several different types of betting lines may appear. The one that most people are familiar with (and which nearly everyone understands) is the point spread.
A points spread line might look like this:
Enormous State University:-6
Giga College: +6
This example says that if you bet on Enormous State University, you need them to win by 6 to win the bet. Enormous State is thus the favorite. In a pool, all you care about is the win, so in this case the wisdom of the crowds suggests picking Enormous State. If the spread were closer (say, -2), or even, then it is anybody’s game.
Another type of betting line (often described as an “American” or “Money Line”) looks like this:
Enormous State University:-175
Giga College: +175
Here’s how you read those lines:
Positive Odds indicate how much you would win with a $100 bet. With the GigaCollege, you would win $175 by betting $100. Negative Odds indicate how much you spend to earn $100. With Enormous State, you would have to bet $175 to win $100.
The team with the negative line is thus the favorite. Bookies generally will make money only when the underdog wins. The ideal situation is to have an equal amount of cash bet on each team, which practically guarantees a profit. Since the bookie realizes that more people are going to bet on the favorite, the money line has to be set in such a fashion that encourages people to bet on the underdog. As better confidence in the favorite increases, the differential in the money line will get larger.
The wisdom of the crowds suggests that you pick the team with the negative line in your pool. If you’re looking for a likely upset, look for a line where the numbers are closer to zero.
Finally there are fractional odds. This really is just a way of expressing the same ideas in a different fashion. Fractional odds might show up as 3/2, or 20/1.
Fractional betting lines are read by looking at the second number first. That is how much you bet. The first number is how much you win. So in the first case, a bet of $2 would pay $3 if the team wins.
Odds of 3/2 translate to +150 in an American line. 20/1 is +2000. There are lots of online sites that will convert between American, Fractional and Decimal Odds.
In any case, when you are worrying only about wins and losses, and have limited information on which to act, a betting line can often be a good resource. I have in the past relied on betting odds to help me with picks on my fantasy golf teams, to good effect.