Today’s post is over at Edgehogs.
I wanted to know how good moneylines were at predicting wins and loses. Since Las Vegas is still in business, it was a good bet (first joke of the day!) that they were. But I wanted to quantify by how much.
All the moneylines flowing from bookies have a built-in juice or vig, in other words a transaction cost or brokerage fee. Friction, I think they call it. These are easily removed—well, easy to remove when analyzing the data. You’d have no luck removing them when making a bet (second joke of the day, even lamer than the first!).
At Edgehogs there is no juice in our X-Bucks bets. That means you could use our system to try out your secret betting scheme using virtual money. Go get ’em!
Turns out to be an easy calculation to transform (juice-free) moneylines into probabilities of teams winning. I did that for over 2,700 NFL games and looked at a calibration plot, which is the one given above. Full details about what it means are on the blog post.
A hint of how moneyline odds are related to spread odds is also covered (need I say it? ha ha!).
Click on over at see the rest.