One benefit of using pointspread variance (PSV) is that bookmakers are usually a little slow in adjusting teams’ power ratings to their proper levels, creating nice value.
We feel that one of the best ways to determine if an NBA team is either underrated or overrated is to look at its average pointspread variance (PSV) over the course of a season.
PSV is simply the variance between the closing pointspread on a game and the actual final score differential. For example, if a team is favored by four points and wins the game by seven, their pointspread variance (PSV) for that game would be +3.0, or if a team is a 5½-point underdog and wins the game outright by eight points, their PSV for the game would be +13½. A team with a positive average PSV would be considered underrated and a team with a negative average PSV would be considered overrated.
We prefer this method to using the novice approach of looking at each team’s raw record against the spread. Those ATS records are commonly known by bettors and bookmakers alike, and thus the oddmakers are usually able to quickly adjust the spreads in a way that the ATS records approach 50 percent. With PSV however, this adjustment is theoretically longer, as the bookmakers could only adjust their power ratings so much after each game (excepting major injuries of course). Thus, if you find a team with a PSV of +2.0, it may take four games or so for that team to be priced correctly, assuming the oddsmakers adjust that team’s power rating by half a point after each contest.
Before we go on, let us say that the bookmakers have done an excellent job as usual, as the entire population of all NBA home teams this season as a small PSV of -0.14 points. This means that the road teams have had the best of it slightly to this point, but not nearly by a big enough margin to be backed blindly with confidence.
However, we did find eight NBA teams that have a PSV of greater than +1.50, and we feel that at least seven of these teams continue to merit backing in the immediate future, with the possible lone holdout being the Portland Trail Blazers. On the flip side, there are also six teams with a PSV less than -1.50, and we would continue to look to fade these clubs, as the bookmakers continue to be a tad slow catching up to just how overrated these squads are.
Here are the eight teams with a PSV greater than +1.50:
1 – LOS ANGELES LAKERS (+4.11): The Lakers may be a very public team, but the bookmakers have continued to underrate them by this surprisingly wide margin, and as a result they are 37-22-2, 62.7 percent against the spread for the season. Furthermore, the Lakers have been a gold mine on the road with an amazing +5.17 PSV, which has translated to a scintillating 21-10-2, 67.7 percent ATS mark.
2 – BOSTON CELTICS (+2.79): The Celtics were supposed to be good this season, but while they have not outperformed the Lakers, they have still surpassed even those lofty pre-season expectations. Sure they have leveled off at home, where they are now just 17-14 ATS, but like the Lakers they continue to be excellent bets on the road. Boston has a nice +3.13 PSV away from home, resulting in a 17-10-1, 63.0 percent road mark vs. the number.
3 – TORONTO RAPTORS (+2.71): This is a good example of where using the PSV approach may have uncovered a gem. While many people feel that The Raptors are a fine team, not many would have thought that their overall performance from a betting standpoint this season would be comparable to the Celtics. The major difference though is that Toronto has done their damage at home, where they are a hefty 18-12, 60.0 percent ATS.
4 – PHILADELPHIA 76ERS (+2.66): The 76ers are another diamond in the rough, and the fact that they are fighting for a playoff spot should continue to give them value in the foreseeable future. They are at 55.2 percent ATS overall, but Philadelphia is always worth a look at home, where they are 16-12-2, 57.1 percent ATS with an excellent +3.58 PSV.
5 – DETROIT PISTONS (+2.12): The Pistons are another team with a better PSV at home (+2.91) than on the road (+1.45), and that is certainly reflected in their home and away ATS splits. Detroit is a wallet filling 17-11, 60.7 percent ATS at home, as opposed to a losing 17-16 ATS on the road.
6 – NEW ORLEANS HORNETS (+1.77): The Hornets have the third best ATS record in the NBA behind the Lakers and the Orlando Magic, at 37-23, 61.7 percent overall. That said, their road PSV of +3.28 dwarfs their minute home PSV of +0.35, so it should come as no surprise that the Hornets are a fantastic 19-10, 65.5 percent ATS away from New Orleans.
7 – PORTLAND TRAIL BLAZERS (+1.71): As we mentioned, this is the one team on this list that comes with a warning label. The Blazers were a nice story early in the season, when they greatly outperformed expectations and even put together a 13-game straight up winning streak. They were playing to an enormous PSV at that time, so this current figure is more of a residual balance from that early season success. In reality, Portland is 5-15 ATS in their last 20 games overall including a woeful 1-10 ATS at home!
8 – ORLANDO MAGIC (+1.63): The Magic have the second best ATS record in the NBA, and they are over 60 percent against the number both at home (17-11-1, 60.7) and on the road (23-11, 67.6). That sensational road ATS mark comes as no surprise when you consider their outstanding 3.94 road PSV.
Now here are the six clubs that continue to be overrated by at least -1.50 points:
25 – MEMPHIS GRIZZLIES (-1.66): This is obviously a down tear for the Grizzlies, yet they remain overvalued at home, where their -2.70 PSV has led to a poor 13-19 home ATS record.
26 – DALLAS MAVERICKS (-1.75): The Mavericks have always done very well on the road in the past, but they struggling away from home this season with a -2.52 PSV. Thus, Dallas is just 14-19, 42.4 percent ATS in their road games.
27 – PHOENIX SUNS (-2.50): The Suns are generally overrated because casual bettors love their flashy style, and that has certainly been the case at home this year, where they are just 11-18-1 ATS for a woeful 37.9 percent, which is consistent with their lousy home PSV of -3.30. Do not expect much improvement with Shaq holding down the run and gun offense.
28 – MILWAUKEE BUCKS (-2.84): The Bucks have a severe PSV split, as they are just -0.66 at home but a gross -4.81 on the road. Thus, you would expect Milwaukee to be much worse on the road and they are, at a pitiful 12-19-1, 38.7 percent ATS. By comparison, they are actually an excellent 16-13, 55.2 percent ATS at home.
29 – NEW JERSEY NETS (-3.45): Based on pre-season expectations, the Nets are right there with the Chicago Bulls as the biggest disappointments in the NBA. New Jersey has been most hideous at home, where they are only 11-21, 34.4 percent ATS with an awful -4.08 PSV.
30 – MIAMI HEAT (-3.97): As bad as the Nets have been at home, Miami has been the worst home team in the league, where their disgusting PSV of -5.76 has directly resulted in a horrendous 8-21, 27..6 percent home record.