Numerous studies claim that inefficiencies in the NFL betting market don’t exist.
Since 1985, there are just five publicly available (free) studies that suggest or hint at an inefficiency. One such study is called “Herd behavior and underdogs in the NFL,” published in 2010, which is the most recent of the bunch and also the most interesting.
Sean Wever and David Aadland, the study’s authors, looked at a sample of nine NFL regular seasons (2000-08) to see how double digit underdogs fared against the spread. Their basic findings were that betting large home underdogs (and visiting teams that were even larger dogs) could generate substantial profit.
How substantial? In the neighborhood of 58 to 60 percent.
The authors hypothesized that herd behavior is responsible for the bias toward favorites. (Public bettors are very likely to be influenced by pundits, talking heads and analyst opinion.) As a result, there is a substantial edge by taking the underdog at an inflated line, especially if the dog is a ‘poor’ team up against one of the league’s ‘elites.’
“The evidence from our study suggests that the recent NFL betting market has underpriced large underdogs and bettors have failed to recognize the amount of parity in the NFL,” the authors write.
Since the study looked at games from 2000 through 2008 (week 17 games were excluded), we figured it might be interesting to see if betting double digit dogs has continued to be profitable over the last three seasons.
Here are the results:
2009: 29-26-2 (52.72%)
2010: 12-10 (54.54%)
2011: 21-13-2 (61.7%)
While all three years surpass the necessary break-even point of 52.38%, the edge falls short of the 58 to 60 percent the authors said they found from 2000 through 2008. In total, double digit dogs have covered 55.8% of the time over the last three years.
Last year, underdogs of 10 or more points covered 21 of 34 times (61.7%), including a handful of outright victories.