Moneylines are a popular way to bet both baseball and hockey. But, have you thought much about the mathematics involved? You should since they have a large impact on your decision to bet or not.
How about we compare a simple multiple choice question. Which is better?
a) $200 to win $100 on a favorite with a 66.67% chance of winning
b) $100 to win $100 on a team with a 50/50 chance of winning
c) $100 to win $300 on a team with a 25% chance of winning
It’s a trick. They all are the same quality of bet with an expected return of $0.
Let’s take a look. By going with choice ‘a’ 2/3 of the time you win $100, but you lose $100 1/3 of the time.
Expected return is computed here: (.667 * 100) – (.33 * 200) = 66.7 – 66.7 = 0
Now let’s look at ‘b’. Half of the time you win $100 and half of the time you lose $100.
Expected return = (.50 * 100) – (.50 * 100) = 50 – 50 = 0
Finally there is ‘c’. 25% of the time you win $300 but you lose $100 75% of the time.
Expected return = (.25 * 300) – (.75 * 100) = 75 – 75 = 0
It’s easy to see what I’m getting on. You need to know what your break even point for winning is for each given moneyline. Luckily, there is an easy formula for figuring that out.
Required Win % = Amount Risked / (Amount Risked + Amount of Win)
Let’s look at an example. Let’s say a team is -150. That means you risk $150 to win $100. So you take 150/(150+100) = 60%.
I know I know. You thought you were done with algebra once you graduated from high school. But it’s really not that hard and it can save you some coin in the long run.
When you are handicapping a game you need to come up with a number. That’s the percentage chance you think a team has of winning the game. You then compare that to the amount needed to profit on the money line. If you think a -200 favorite will win 80% of the time, there is a significant opportunity for you to profit from your wager. If you think they win 65% of the time, then you need to pass and move on to the next event.
Are underdogs better or worse than favorites? I’ve found there is no difference. Most public bettors fall in love with “can’t lose” teams. However, even the best baseball teams lose 60+ times per year. The worse teams can expect to win almost 40% of the time!
Personally I prefer underdogs and small favorites because it reduced the chance of a big loss. If you lose a couple of -300 favorites in a row you are going to take a big hit to the bankroll. On the other hand if you win a couple in the row taking +200 dogs you are going to be sitting nice.
That doesn’t mean shy away from the big numbers. Last year there were 80 favorites of -300 or higher. 70 of them won and only 10 of them lost! Place a $100 bet on each one would have won you $3,000! That’s a pretty hefty profit and a check I would be happy to receive from the book.
Remember, it’s important to compare the price you can get to how much you will get back. That break even point matters more than if you are laying 200 on a baseball game. There could be profit in those games.