Does everyone really love an underdog?
The betting gods giveth and the betting gods taketh away. After an ultra successful October, NFL sports bettors got destroyed in November, leading to what Superbook executive director John Murray told ESPN was “one of our best hold months in Nevada on record.”
Jeff Stoneback, who heads BetMGM’s Nevada sportsbook, told ESPN’s David Purdum, “There was one week where the players had only one game that they won, and another week they only won two games.”
“We did have big wins, yes, but the number of wins, percentage-wise for us, was unbelievable,” he added. “I was shocked.”
The reason sportsbooks made a mint in November: underdogs kept winning. Going into last night’s Monday Night Football game, underdogs covered the spread in almost 60% of the NFL’s game in November and 23 times they won outright. Oh, and Washington Football Team was a 1.5-point dog to the Seattle Seahawks on Monday and won the game, 17-15.
The most shocking upset of the month was when the woeful Jacksonville Jaguars defeated the normally high-scoring Buffalo Bills on November 7 by a pitiful score of 9-7. That screwed all the over bettors, too.
“Dominant teams earlier in the year have come down to earth, and dogs have been covering at a much higher clip,” said Station Casinos bookmaker Chuck Esposito. “There are 24 teams that are still fighting for playoff spots.”
Historically, Nevada sportsbooks average 5.5% hold, which means they make 5.5% on the bets they take (they “hold” 5.5%). As November wound to an end, the famed Superbook at Westgate Las Vegas was on track for a 6.25% hold.
Confidence in intuition plays a major role
From a casual observer’s perspective, it is logical that the betting public would pick favorites more often and thus a slew of upsets would be good for sportsbooks. But FiveThirtyEight.com’s Nate Silver looked into why (and if) this is actually the case back in 2014. According to experts he spoke with, it has to do with people having confidence in their intuitions.
“When people decide how to bet on a game, first they identify who is going to win,” Leif Nelson, associate professor at the Haas School of Business at the University of California, Berkeley told Silver. “The faster and easier it (the decision) is, the less concerned they are with correcting that intuition when answering the more difficult question of whether the favorite is going to beat the point spread.”
Nelson and Joseph Simmons, an associate professor at the University of Pennsylvania’s Wharton School, analyzed betting data from over 1,000 NFL games from 2009 to 2012 and found that “the average share of money bet on the favorite was 65 percent.”
In a similar study from the 2003 and 2004 NFL and college seasons, they found that favorites beat the spread about half the time, but bettors picked them more than two-thirds of the time.