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How Sharp is Vegas?

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How Sharp is Vegas?

Does Vegas really get it right all the time?

Introduction by Dave Bartoo, The CFBMatrix

This is our first entry into the new #CFBMythbusters section of the site so I wanted to give a little intro.  I started this so fans that have ideas, assumptions or questions to test can see what numbers, trends, stats and metrics say to prove or disprove the questions.

While this one is about the NFL (and we are going to do the same for college football), it does relate a bit to watching college football as the Vegas numbers are even more ‘off’ in college football (2013 FBS off 12.93 points per game and only 33 of the last 235 FBS games were within 3 points of Vegas lines).

Got a question for our team? Fill out the form in the drop down menu and join in the fun. I want this to be the place where folks that love their stats and CFB come to hang out.
~Dave @CFBMatrix

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Bust This: Hey Dave. I’ve been following @CFBMatrix on twitter for a long time. I hear it all the time on NFL broadcasts how ‘Vegas nailed this one again’. Is Vegas really that dead on all the time? – Bobby @bmarks3

BUSTED

Without reading ahead, what is your perceived assumption to the average number of points Vegas is off on average on every NFL game? 2.5 points? 5? 7? Over 10? Are you pretty confident in your estimate?  Remember your answer as we will get back to it later.

Among the sporting institutions in this country, the National Football League is currently king. It seems the only entity that can keep pace with the NFL is the wagering that takes place in conjunction with it. Forgotten are the days of going to the back of your Sunday paper, or tuning to the NFL Today to catch Jimmy the Greek break out his chalkboard and check marks to get the weekly lines. The spreads are everywhere now. It is no longer a taboo word but rather a major part of the conversation. Hell, it even scrolls across the bottom line of ESPN. Just google anything related to wagering on the NFL and you will be inundated with websites and blogs devoted to tracking stats and creating formulas to beat the handicappers.

All of this increased exposure creates a lot of information and it is hard to decipher between what is valuable and what is just noise. Sifting through the clutter it seems there are a few narratives that you hear constantly when wagering on the NFL. Things like, “The lines are only set to get 50/50 action”, or “There is a small margin for error because the games are too close”. But the one I ran across most was “The handicappers are too sharp”. With this being stated time and again, I figured there would be tons of information backing up this sentiment, but I couldn’t find the supporting data anywhere.

The statistic that I did find was the one focusing on margin of victory. Since 2003, 15.39% of games ended with a margin of 3 points and 9.55% ended with a margin of 7 points. These were the largest percentages of all possible outcomes. Sure, these are important numbers when betting but where is the data on how close the margin is when compared with the spread? Where is the information to back up the claims about how smart the handicappers are? Again, it was nowhere to be found.

As someone who pays attention for “entertainment purposes only,” I thought I had a pretty good understanding on the accuracy of the handicappers. Then I spoke with Dave Bartoo and realized I knew next to nothing. In that conversation, Dave asked me the same question that I asked you, “How sharp is Vegas when it comes to handicapping NFL games? At first thought I figured around 3-5 points. It was then that he challenged me to dig deeper and he told me I would be very surprised with the result. So I did and he was right, I was shocked. Now I want to share those results and I think they will shock you as well.

To complete this task I tracked the closing lines for the past 8 seasons using the website FootballLocks.com.

From 2006-2013 there have been 2048 regular season games played in the NFL. Over that span the average difference between the line and the final outcome of the game was a staggering 10.76 points. Only one season over the past 8 has there been an average below 10 points and that was during this past season when the average was 9.96.

Sharp Vegas Image 1Another assumption made by most NFL bettors is that the handicappers get sharper as the season goes on. The chart below tends to debunk that narrative. The handicappers have better weeks but there is no correlation with the average getting smaller the further you get into a season. What does stand out is that over 136 weeks of NFL games, there was only one week where the handicappers were at an average margin of 5 points, and at no time did they have an average week below that number.

Sharp Vegas Image 2

Breaking it down further take a look at the data regarding where the spread is set. From 2006-2013 the lines closed between PK-4.5 points 1025 times (50%). In those games the average difference between the line and the outcome was 10.27. Games with lines between 5-9.5 points occurred 721 times (35%), and had an average difference of 11.57. The line was set at 10 or more points 302 times (15%), with an average difference of 11.44.

Sharp Vegas Image 3Judging by the number of lavish casinos continually being built in Las Vegas, it’s obvious the handicappers are smart, and in no way do I think you can take this information and break the books.  The next time you watch a game go down to the final play and hit right on the spread and Brent Musburger or Al Michaels anoint the handicappers as geniuses, just remember all the other times they are not within two scores.

So, were you close on your estimate?

Written by Jon Wheeler – StatGeek Contributor
Contact: jonwheeler13@gmail.com | @jwheel55

5 Comments

  1. The Kid

    April 7, 2014 at 9:57 pm

    Jon, Interesting concept. I like where you’re going with it. The number is a bit higher than I anticipated, but, even at an average of 10 points off, you’re dealing with an average that has a floor, but no ceiling. There’s a limit to how “right” they can be, but no limit to how far wrong they can be. If you re-run those numbers, what is the median?

    To me, it’s largely insignificant if they’re off by 14 or 40. I’d be interested to know what percent of the time are they within 3, 6, 7, etc. How accurate are they on the 25th, 50th, 75th percentile of games? If you have the numbers in a way that’s not too difficult to check that, I’d love to know those answers.

    Great work. Thanks.

  2. Jon Wheeler

    April 8, 2014 at 7:52 am

    Great question. I have been looking at something similar but not specifically what you are asking about. I will have to run those numbers and get back to you. However I do know that in the past eight seasons (2048 games) that the outcomes (final score – spread) have resulted between 0-4.5 points 558 times(27.2%), between 5-9.5 points 543 times (26.5%), and 10+ points 947 times (46.2%). Thanks for the feedback and for reading the article.

  3. Jon Wheeler

    April 8, 2014 at 7:24 pm

    The average median from 2006-2013 is 8.96. Listed below is a breakdown annually as well.

    2013 – 8.44
    2012 – 8.72
    2011 – 8.51
    2010 – 8.44
    2009 – 9.31
    2008 – 9.75
    2007 – 9.62
    2006 – 8.51

  4. The Kid

    April 8, 2014 at 11:02 pm

    Jon, Thanks for that extra info. The median being 8.96 surprises me more than the mean being 10.76. I’d have guessed it to be 7-7.5. I’ve always heard there was no value in betting teasers in college football, but I’ve never had data that supported that statement so strongly.

  5. Birch Street Putter

    April 10, 2014 at 8:38 am

    Great article Jon. When one of Big Al’s mercenaries calls and wakes me up on Saturday morning during college football season trying to sell me the “10 dime lock of the week” and making me buy that 1/2 point I’m going to reference your statistics.

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