Calculating EV by beating closing line

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  • PRC
    SBR Wise Guy
    • 10-22-09
    • 576

    #1
    Calculating EV by beating closing line
    Thanks to everyone who helped my question in this thread: http://forum.sbrforum.com/handicappe...-line-mls.html

    Now I have another one. Everyone here knows that you get an edge by beating the closing line. Exactly how do you know (in percentage) how much you beat it be?

    Say you bet the Bears -2.5 vs. the Vikings and it closes at -3.5. According to the HPC, the 3 has push probability of 9.79%. So you're ahead of the market by 9.79%. Now do you subtract -4.55% (your edge on a bet at -110) from 9.79% to give you an EV of +5.24%? Or do you subtract 2.4% (because you need to hit 52.4% to break even) from the push probabilities you beat?
  • Justin7
    SBR Hall of Famer
    • 07-31-06
    • 8577

    #2
    If it is just a rogue number, I'd use your method. If it is handicapping, that is a floor... but the winning players tend to do a bit better than that - the market doesn't move all the way to where it should due to vigorish.
    Comment
    • Dunder
      Restricted User
      • 10-26-09
      • 3345

      #3
      The market says that the ´correct´line is 3.5, according to the HPC that means that the line for -2.5 should be -148.7.

      As such your EV is:

      148.7/248.7 = 0.5979 (probability of your bet hitting)
      divided by
      110/210 = 0.5238 (implied probability of the line you took)

      minus 1

      i.e. (0.5979 divided by 0.5238) = 1.1415
      minus 1 = an EV of 14.15%
      Comment
      • PRC
        SBR Wise Guy
        • 10-22-09
        • 576

        #4
        Thanks Dunder, I see how you get it by using the implied winning %s (assuming there's no handicapping as Justin7 said). But is there a way to do it w/0 the HPC and just by using the push probs?
        Comment
        • Dunder
          Restricted User
          • 10-26-09
          • 3345

          #5
          Originally posted by PRC
          Thanks Dunder, I see how you get it by using the implied winning %s (assuming there's no handicapping as Justin7 said). But is there a way to do it w/0 the HPC and just by using the push probs?
          It is essentially the same thing PRC.

          In your example, the 9.79% push probability is doubled (59.79% : 40.21%)
          So your edge not accounting for juice is 19.58%

          Juice is 4.76%

          Calculate your EV by (1 + edge) divided by (1 + juice)
          i.e. 1.1959 divided by 1.0476 = 14.15%
          Comment
          • aggieshawn
            SBR MVP
            • 01-24-07
            • 4377

            #6
            nice notes.
            Comment
            • roasthawg
              SBR MVP
              • 11-09-07
              • 2990

              #7
              Originally posted by Justin7
              If it is just a rogue number, I'd use your method. If it is handicapping, that is a floor... but the winning players tend to do a bit better than that - the market doesn't move all the way to where it should due to vigorish.
              I pretty much agree with this... lines are definitely off. On any given day I can find a bunch of +EV plays... I'm still not exactly 100% positive as to why this is but my guess is the vigorish or the lines makers knowing that certain lines will bring in a lot of action on the wrong side. I'm an outsider looking in so I don't know for certain... all I can do is theorize. I sure hope it stays like this for the foreseeable future though!
              Comment
              • PRC
                SBR Wise Guy
                • 10-22-09
                • 576

                #8
                Originally posted by Dunder
                It is essentially the same thing PRC.

                In your example, the 9.79% push probability is doubled (59.79% : 40.21%)
                So your edge not accounting for juice is 19.58%

                Juice is 4.76%

                Calculate your EV by (1 + edge) divided by (1 + juice)
                i.e. 1.1959 divided by 1.0476 = 14.15%
                You're the man Dunder, thanks for answering my basic questions. You need to start somewhere.

                I see where you get the 19.58% (+9.79 off 50% both ways), but where do you get juice as 4.76%? I thought it was 4.55%?

                Originally posted by roasthawg
                I pretty much agree with this... lines are definitely off. On any given day I can find a bunch of +EV plays... I'm still not exactly 100% positive as to why this is but my guess is the vigorish or the lines makers knowing that certain lines will bring in a lot of action on the wrong side. I'm an outsider looking in so I don't know for certain... all I can do is theorize. I sure hope it stays like this for the foreseeable future though!
                I don't disagree, but I was just talking about a theoretical example that assumes the closing line is a perfect 50-50 proposition.
                Comment
                • Dunder
                  Restricted User
                  • 10-26-09
                  • 3345

                  #9
                  Originally posted by PRC
                  You're the man Dunder, thanks for answering my basic questions. You need to start somewhere.

                  I see where you get the 19.58% (+9.79 off 50% both ways), but where do you get juice as 4.76%? I thought it was 4.55%?
                  Suppose you and someone else bet opposite sides of a game at -110. 110 to win 100.
                  The book holds $220 and will have to pay out $210.

                  220/210 = 1.0476.
                  Juice is therefore 4.76%

                  4.55% is the inverse of this. (1 divided by 1.0476 = 0.9545)
                  Comment
                  • smitch124
                    SBR Posting Legend
                    • 05-19-08
                    • 12566

                    #10
                    Originally posted by PRC
                    Thanks to everyone who helped my question in this thread: http://forum.sbrforum.com/handicappe...-line-mls.html

                    Now I have another one. Everyone here knows that you get an edge by beating the closing line. Exactly how do you know (in percentage) how much you beat it be?

                    Say you bet the Bears -2.5 vs. the Vikings and it closes at -3.5. According to the HPC, the 3 has push probability of 9.79%. So you're ahead of the market by 9.79%. Now do you subtract -4.55% (your edge on a bet at -110) from 9.79% to give you an EV of +5.24%? Or do you subtract 2.4% (because you need to hit 52.4% to break even) from the push probabilities you beat?
                    Well if I have been using the HPC correctly, to figure out my edge if the efficient line (or the closer) is -3.5 -110/-110 and I have -2.5 at -110 I can put all these values in the calculator and get an edge of 14.14% by starting with a spread of 3.5 at the top entering it and typing in -110 into the price for the fav at -2.5.
                    Comment
                    • PRC
                      SBR Wise Guy
                      • 10-22-09
                      • 576

                      #11
                      Thanks, smitch. I know how to use the HPC but was curious how to calculate it w/o relying on it.
                      Comment
                      • MasterP10
                        SBR MVP
                        • 08-19-10
                        • 1513

                        #12
                        220/210 = 1.0476.
                        Juice is therefore 4.76%

                        4.55% is the inverse of this. (1 divided by 1.0476 = 0.9545)

                        Hey Dunder, how did you come up with these calculations?

                        Tyring to figure out what my edge is on tonight's game pit vs nyg. I have pit -2.5 -101 (guess i'm one of the lucky few) seeing how the line is around 6-6.5 -110 in most places.

                        I tried using the HPC but couldn't seem to get the numbers you guys were getting? Any help would be appreciated. Thanks.
                        Comment
                        • dodger33
                          SBR MVP
                          • 08-14-09
                          • 3962

                          #13
                          So now you have a 14.15% +EV bet. So theoretically if you knew before you placed the bet that you had a 14.15% edge how much would you correspondingly increase that bet size compared to an average game?
                          Comment
                          • Inspirited
                            SBR MVP
                            • 06-26-10
                            • 1788

                            #14
                            What does HPC stand for?
                            Comment
                            • dodger33
                              SBR MVP
                              • 08-14-09
                              • 3962

                              #15
                              Half point calculator. It is in the sbrtools
                              Comment
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