Why Contrarian Sports Investing Works

Why Contrarian Sports Investing Works

Yesterday, one of SportInsights’ analysts highlighted the Colts-Titans game on the SportsInsights.com blog.  In addition, SportsInsights made the Titans an NFL Square Play.

Although the Colts dominated much of the game, the Titans made a game out of it.  Very late in the game, while the Titans were not seriously threatening to win, they succeeded in a “backdoor cover” against the spread.

SportsInsights put together an article on “why contrarian sports investing” works.  We take a closer look at the fundamental reasons why contrarian methods work — as well as the research, numbers, and data that backs these methods.

Below are some highlights of the article.  Please visit the article for more details.

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How can “David beat Goliath?”  Points Matter!

• Oftentimes, the “favorite” completely demolishes the “underdog.”  Please see this blog post on another potential play that looked “ugly” — http://blog.sportsinsights.com/2010/10/a-look-at-monday-night-football/.  Here, one of SportsInsights’ analysts commented that: “… Truth be told: if we played this game 100 times, we’d probably see 30 blowout victories for the (favorite).  They are still a strong team…” Indeed, the favorite (New England in a Monday Night Football game), crushed Miami by a score of 41-14 in that lopsided-bet game.
• On the other hand, in the same blog post, the analyst commented that this underdog would probably cover “against the spread” about 55% of the time.
• Public perceptions can often push pricing out of line with actual value. In the case of sports betting, the betting lines are impacted by public perceptions and betting syndicates.
• Line value: The sports marketplace is very efficient.  Take the Colts-Titan game that we mentioned above.  The point spread opened at Titans +2, which is exactly where the game ended!  However, the constant pounding of betting on the Colts pushed the line all the way up to Titans +3.5.  This extra bit helped contrarian sports investors squeak out a win — and allows bettors who “bet against the Public” achieve a measurable edge against the spread.