Many articles have been written on the ideal threshold for contrarian betting. It’s been demonstrated that betting against the public will produce a winning record,
Because oddsmakers do not attempt to balance their book by attracting 50 percent of the action on each side but rather shade their opening lines to capitalize on public perception and then allow their sharpest bettors to shape the line.
By utilizing public betting trends from several sportsbooks, we are able to do a midseason betting analysis and see which teams are being pounded by a majority of public bettors. This simple strategy encourages bettors to identify the most popular teams and bet against them; thereby capitalizing on lines that have been shaded to exploit public perception.
The basic strategy behind the betting against the public philosophy is quite simple. Oddsmakers are able to anticipate which games will take one-sided public betting, so they typically shade their opening lines to account for the predictable flood of public money. If the liability becomes too great, they will often adjust their number to encourage action on the other side, thereby mitigating their risk.
It’s also important to understand that there are essentially two types of bettors in the sports betting marketplace: “sharps” and “squares.” Sharps are typically wise guys or betting syndicates who spread large bets across multiple sportsbooks. Widely respected, sharps are a smaller group who move lines across the sports betting marketplace.
Most casual bettors can be classified as squares. These recreational bettors place their wagers based on instinct, rather than data analysis. Squares have a tendency to pound favorites and overs, which has historically created value on underdogs and unders. We have also found that casual bettors tend to overvalue the importance of home court advantage, which has created additional value on visitors.
Sportsbooks aren’t in the business of minimizing risk; they’re in the business of maximizing profits. That means sportsbooks won’t adjust their number based on public betting unless there’s massive liability on one side. Betting against the public is only an effective strategy in games with extreme levels of one-sided public betting with limited involvement from sharp bettors.
Since 2005, the favorite has received a majority of spread bets in over 75% of all regular season games. Unfortunately, simply betting on contrarian underdogs hasn’t historically covered the spread at a high enough rate to overcome the standard -110 juice. This season, the majority of spread bettors have taken the favorite in over 85% of games, and contrarian bettors would have fared quite well in these games.
Although we haven’t been archiving our money percentages for nearly as long as our ticket percentages, the early results are very encouraging. Sportsbooks will adjust their lines based on public money, not necessarily the ticket count. In the past, we had to use our ticket percentages as a rough approximation of these money percentages. Now that we’re receiving real money percentages from a sharp offshore sportsbook, we can see that betting against the public has been profitable for both favorites and underdogs. There’s more on this mid season betting analysis, sign up now at HeritageSports.eu