Science
Predictive Analytics in Sports Betting: Can Data Give You an Edge?
Expert sports bettors are always on the lookout for good deals or betting markets with a preferable risk to reward ratio. Line shopping, stake sizing and game projections are all tools that can be used to optimise a betting strategy, and refine the way you approach your sports bets. They are all a part of predictive analytics, something that is used in many different sectors.
Predictive analytics are sets of methods used for forecasting or predicting. It can be forecasting stock market trends, planning sales data for manufacturers, resource management, or literally any sector. In sports betting, it serves to give bettors that perceived edge and look for better opportunities. Yet predictive analytics are not infallible, and even with the most in-depth analysis, you still run the risk of losing your bet. So here we will look at various predictive analytics methods and show you how to use them. At the end, you should have a few new resources to hone your betting skills, and hopefully optimise your long-term betting strategy.
Predictive Analytics Used in Sports Betting
The goal is to know how to spot a good deal, bet with the bigger picture in mind, and optimise your bankroll. You want to avoid getting swept away in fads, go all in on specific wagers or misjudging the risks involved with a wager. Instead, bettors who use predictive analytics effectively are patient and make premeditated decisions with full understanding of the underlying risks.
Predictive analytics does not just measure up two teams in a sports game and give you a rough idea of what will happen. It is also used to figure out whether the odds are worth it, or if there are unexplored niche markets with a better risk to reward ratio. You can also use it to size your stake or plan your betting strategy. For instance, how much you will stake on a bet you are quite confident in. Or, how many legs will you risk putting into your betting parlay.
Using Model-Based Simulations and Projections
Model based simulations effectively calculate the probability of the different lines of a betting market to win. Many sportsbooks display percentages or data-driven probabilities of either team winning. These can use simple percentages of the H2H results, or how often the teams win when they are priced at those odds.
There are many different projections you can use, such as Monte Carlo simulations to estimate a team’s probability of winning based on their previous results. Or use software that can utilise more data to classify outcomes, using methods such as the Poisson Distribution or ELO-Based model. These take in statistical data such as average spread margin, Home/Away winning percentages, points scored, points conceded, and more.
Looking for +EV in Sports Betting
Simulations can help give you a rough idea of a team’s chances of winning. And if you cross-reference this information with the implied probability of the odds, you can see whether the bets come at good value or not. In bettor’s terms, that means the Expected Value is positive (+EV) or negative (-EV).
For instance, your match winner calculator deems that the NY Yankees have a 63% chance of beating the Detroit Tigers. You must see how that converts into betting odds. To do so, you need to divide 1 by your estimate (in percent).
- 1 / Winning Probability = Expected Value Odds
- 1 / 0.63 = 1.58
According to your data (63% chance of winning), a fairly priced wager is 1.58 decimal odds. This calculates to -172 American odds. You can use our universal odds calculator to convert Moneyline odds (American) into decimal.
Let’s say at the first sportsbook you look at, the Yankees are priced at -200 (1.5 decimal odds). This is below the odds that your estimate has priced them at. Implied odds of the wager are made by dividing 1 by the decimal odds. So in the case of -200 (1.5), the implied probability is 66.67%. So the bookmaker is more confident in the Yankees winning, which is not good for you.
At another sportsbook, the Yankees are priced at -150 (1.667) instead. The IP on this bet is 60%, which is 3% lower than you estimated. This is good, as you aim to find a bet that has longer odds than 1.58. This means, the expected value is positive. In betting terms, this would be written as +EV.
Instead of betting $10 to win $15.80, you would win $16.67.
Shopping Lines for Discrepancies
The example we supplied above is a bit of a stretch from reality. As you wouldn’t find such a big discrepancy between oddsmakers. When oddsmakers generate the odds, they use similar predictive analytics and algorithms to determine the probabilities of a team winning. But they don’t stop there.
Odds are calculated in a way that profit the book. Therefore, they apply some juice, or vig, on their wagers to shorten the odds ever so slightly. If you added the implied probabilities of each line in a market together, they would total over 100%. Which is practically impossible, but that’s the way the book makes its edge.
You could browse different sportsbooks to look for line discrepancies and get a closer estimate to the Expected Value and True Probability of the wagers themselves. It is also used in hedge or abritrage betting strategies, where you back opposing lines to win regardless of which team wins the game. But this is frowned upon by sportsbooks, and if they suspect you of hedge betting, you may get penalties or they can even suspend your betting account.
You can see the odds discrepancies for yourself in our best odds trackers. Below are links to our odds comparison tables where we source premium betting odds from top sportsbooks.
Looking for Line Shifts
Betting lines also shift in the days and hours preceding a sports event. As different external factors such as weather conditions, off-field occurrences, player injuries, and other aspects can impact the game. These statistics and data are taken into account at sportsbooks. But they are often overlooked by data driven software that only look at historical performance data. And they can have a tremendous impact on what will happen in the next game.
For instance, at the start of the week the Toronto Raptors may be the favorites to beat the Brookyln Nets, at odds of -150. But in the days preceding the event, the lines change and the perceived difference between the two becomes shorter. It may be because of a player injury, news about a trade, or anything else you can think of.
Just before the game starts, you get the closing line value. These are the final odds right before the pregame betting markets close, the game begins, and the in-game odds go live. By analysing trends and using predictive analytics, you can follow line shifts and determine whether the closing line value on your bet is better or worse than the price you bought at.
The line value also changes because of public betting. If the public places more bets on the favorites, betting sites tend to shade the lines on that bet. This means, shifting the juice so that there is more juice on the favorite than on the underdog.
Bet Sizing and Value Betting
Value betting is all about spotting and tracking these line shifts, as well as looking for +EV. It doesn’t just serve the purpose of getting you better value for your money. It is also paramount to some bet sizing strategies.
The most famous of these is the Kelly Criterion betting strategy. Kelly Criterion bettors don’t just look for good value and bet. They analyse the percentage of how good the value is. And based on that percentage, they allocate a portion of their bankroll onto that bet.
In theory, this practise mitigates the risks and also optimises wins. You won’t risk as much on a +EV bet that has a lower perceived edge. But even if you find one with a very good +EV, you aren’t going to stake your entire bankroll but a proportionate amount.
Using Statistics to Find Niche Opportunities
Predictive analytics and statistical research can also be used to explore niche betting markets. For instance, if you find better opportunities making prediction on corners, yellow cards, or fouls in a soccer game. Or analysing points scoring methods to bet on 3-pointers or rebounds among the basketball props markets.
These alternate props and betting markets will not have the same volume of bets as, say, moneyline, point spreads or totals. This can open up more +EV opportunities, and also possibilities to combine same game parlays or bet builder wagers.
Long Term Betting Strategy Using Analytics
Predictive analytics are strategies that are constantly evolving. You collect data such as line movements, winning percentages and other analytics to refine your strategy continuously. Instead of looking to make a big money parlay and get lucky on a long shot, it looks at the bigger picture. In that you are looking for good deals, betting cautiously, and never underestimating the risks.
Of course, you could always use predictive analytics to look for golden deals and then swing for the fences. Make a 8 leg parlay with a minimal stake, and hope for the stars to align. But the essence of predictive analytics isn’t really about short term success.
Don’t become overly ambitious and track data of all 30 MLB teams in all of their games. Stick to a handful of teams and specialise in your MLB betting strategy in a way that is manageable and comfortable. After you are more experienced with line changes, spotting where the public bets, and finding +EV wagers, you can slowly expand your horizons.
Patience is the name of the game, and while it doesn’t save you from the occasional defeat, hopefully you can make the most of your bankroll and mitigate the losses.
Predictive Analytics Misconceptions
The biggest misconception about predictive analytics is that it is something that will guarantee you money. Say you pay for a subscription on a sports predictive analytics software. And this software gives you betting tip recommendations on a daily basis. A lot of them do. These tips come with markers to show you how risky they are, such as “90% win rate” or “high confidence”.
It is easy for the uninitiated or anyone who really wants to believe it, that these tips will win them money. Sure, it may work for a few weeks or you may get a streak of good luck. But what happens when you lose 4 picks in a row.
Gambler’s Conceit and Dangers of Sports Predicting
These software use huge pools of data and have tremendous algorithms to simulate sports games. But a lot of them won’t:
- Show you the line changes
- Inform you where the public is betting
- Take in abstract external factors
They also tend to mask the risks, or downplay them. And no bettor, under any circumstances, should underestimate the risks.
Sports betting is not like casino gaming, as it has a far more personal element to it. You aren’t betting on the draw of a card or which symbols will fall on the reels in a slot machine. No, these are bets on sports games, which is more of a test of sports knowledge and prowess.
This skill based element to sports betting makes it feel like we have more control over how we spend our money. And we do, but it still doesn’t change the fact that anything can happen in a game. When you win, it feels extra rewarding as your prediction came through and your betting expertise is seemingly reinforced. A loss carries more gambler’s remorse, as your personal prediction may have completely missed the mark.
Sports betting can also lead to many gamblers’ fallacies. The hot hand fallacy, a typical optimism bias, is where you overestimate the chances of the favorite to win. This can lead to some bettors picking 3, 4, or more legs on their parlay. After all, if they are all strong favorites then they should all win their games easily.
But that is not the case. Variance is a common phenomenon in sports betting, and you may find favorites suddenly entering a losing streak. Or patchy form from an underdog, who beats statistically better teams and loses to perceived “weaker” ones. Using this analysis can also lead to a gambler’s conceit. In that you overestimate your chances of winning.
Think Big Picture and Bet Responsibly
So therefore, you should always keep the risks in mind and never assume any “safe bets” or ones should win. Gambling is all about testing chance, whether it is betting on an NFL game or rolling the dice in craps.
Using predictive analytics can help you understand what goes on behind the scenes at a sportsbook, and that information is extremely valuable. It can help you figure out when the odds may stretch to their longest, and which bets have more value than others.
But always remember that no bet is guaranteed to win. Set deposit limits to make sure you stick to your bankroll. And never bet on impulse, as this habit can lead to compulsive betting.
