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Sports Betting 101: Betting systems better than trends to avoid recency bias

March 27, 2020 11:59 PM

The Merriam-Webster Dictionary describes a trend as a prevailing tendency or inclination, a general movement, a current style or preference or a line of development. 

In sports betting, trends are one of the most common go-to sources of information when determining who to bet on, especially for new or casual bettors. They give bettors a brief and easily digestible breakdown of how both teams have been performing recently. By comparing both team's head-to-head trends and looking for situations where one team's trend lines up nicely against the opponent, it increases the confidence level of bettors to pull the trigger and make a pick. However, trends are often overvalued and over-relied upon, giving bettors a false sense of where the value truly lies. 

Inexperienced bettors fall in love with trends and become victims of recency bias. Think of recency bias as "what have you done for me lately." If a team is coming off a 20-point blowout victory, bettors will be inclined to bet them again because they looked great their last game. Similarly, if a team has won five games in a row and is riding an impressive winning streak, a naive bettor will automatically assume the hot streak continues and blindly continue to back them. This would be considered an "auto-bet" in gambling circles. 

On the flip side, if a team just suffered a humiliating 20-point loss or is riding a five-game losing skid, the natural instinct is to bet against them. After all, only bad teams lose five games in a row or get blown out, right? 

Bettors should reject this oversimplified line of thinking. Despite how a team looks recently, good or bad, it might be completely out of the historical norm. Instead, bettors should focus on sample sizes larger than a handful of games because they more accurately represent a team's overall strength and performance.

Long-term history is a much better indicator of success than short-term runs. Over the course of a long season, teams experience ups and downs. A great team can hit a rough patch and lose three or four games in a row. A bad team can get hot and enjoy a three- or four-game win streak. However, the law of averages always wins out in the end. This would be considered "regression." In the end, everything regresses to the mean.

As a result, bettors should judge teams based on their overall body of work. This means studying a larger sample size of games that take into account the entire season thus far, not just a handful of the most recent games.

For example, let's say the Kansas City Royals are facing the Toronto Blue Jays. The first thing a new or casual bettor would look at if they wanted to bet the game was scour the trends for both teams. Maybe the trends say that Royals are 0-5 in their last five games, 1-7 in their last eight road games and 2-10 in their last 12 games against the Blue Jays. Meanwhile, the Jays are 8-1 in their last nine games and won six in a row at home. Maybe the trends also state that the under has in seven of their last nine Royals games and eight of the last 10 Jays games. An inexperienced bettor would look at those head-to-head trends and that's all they need to know. Take the Jays and the under. Case closed.

The problem with relying exclusively on trends and breaking down games this way is that all of these trends, along with hundreds of others you may not even know about, are already baked into the cake. The oddsmakers set the line with all of this in mind. Don't think you've discovered a Holy Grail trend that the oddsmakers overlooked. The sportsbooks know these types of trends are easily available and many ill-informed bettors will pick games solely based on them. As a result, they will shade numbers toward the trended side—in this case shading the line further toward the popular pick of Jays and under. This forces trend based bettors to bet overpriced numbers that have lost value. 

It's also important to consider how the line moves in comparison to the trends. For example, maybe professional bettors have identified an edge on the Royals or the over. Just like the oddsmakers, the true pros know every trend known to man and hundreds more. So if they are going against these trends and causing the line to move toward the Royals or the over, this would mean trend-based bettors are going directly against sharp money—something you never want to do. 

Another key reason to avoid trend-based betting is that trends could be completely irrelevant and not predictive of an outcome. Maybe you see a trend that states the Miami Heat are 10-0 on Wednesdays this season. So that means you should blindly bet Miami every Wednesday moving forward, right? Not exactly. This could be a complete coincidence and fluke. Or maybe you notice the San Francisco 49ers are 15-2 on Monday Night Football since 1985. However, this trend is largely meaningless because it has no bearing on the current 49ers team and the specific matchup with their opponent. Those 49ers teams that went 15-2 on MNF had different players, different coaches and different opponents. It has nothing to do with this week's MNF showdown against the Cardinals. 

Instead of overreacting to trends, bettors looking to get an edge from historical data should instead focus on betting systems. A betting system is a model that hones in on a profitable situation in the past and then looks for present-day games that fit the same criteria. this is a different way of betting on games. Instead of focusing exclusively on the present day matchup and dissecting two teams facing off, you are instead betting on situations or "spots," not specific teams.

For example, one profitable system in the NFL is "Road Divisional Underdogs." Historically, when two teams from the same division are playing each other the underdog has an advantage due to built in familiarity. Divisional opponents play each other twice per year, every year, which levels the playing field and benefits the team getting points. Road teams are also undervalued because the betting public places too much emphasis on home-field advantage. According to Bet Labs Sports, Road Divisional Underdogs were 535-468 ATS (53.3%) from 2005-2019. This may not seem that impressive, but remember the magic number to break even and turn a profit is 52.38%. 

There are hundreds if not thousands of betting systems like this. The beauty of a betting system is that is has a sound theory behind it and no matter which teams are playing, it remains profitable. In other words, you could plug in any two random teams and the situation would still provide an edge as long as they fit the criteria.

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