I notice quite a few newcomers read this forum. So for the fun of it I thought I'd reintroduce some concepts and apply them to the upcoming MLB series. First is computing the expected returns for a given wager. For this you need 2 pieces of data, the odds and the probability of winning the wager. Looking at the Cleveland - New York series, I found a current line of Cleveland -185 and New York +160. These need to be converted to European style odds for the calculations. Following is the Excel statement that will do that.
=IF(C2>0,(C2+100)/100,(C2-100)/C2)
In this case the odds are Cleveland 1.541 and New York 2.600.
Now for the hard part, assigning the probability of each team winning the series. That's where your handicapping comes into play. I'll cheat and use Nate Silver's fivethirtyeight.com web site to get these. They have Cleveland 67% and New York 33%. Multiplying the odds times the probability gives us the expected return of each wager per dollar bet; Cleveland $1.032, New York $0.858.
OK, so the wager is on Cleveland. But how much? For this we'll use the Kelly Criteria. This formula tells you what percentage of your bank roll to wager given the above data. The Excel formula is;
=+(D2*B2-1)/(D2-1)
This suggests a wager of 6.0% on Cleveland and -8.9% on New York. Following is the series table as it exists at the moment.
538 Prob ML Eur Exp Ret Kelly Indians 67% -185 1.541 $1.032 6.0% Yankees 33% 160 2.600 $0.858 -8.9% Red Sox 40% 155 2.550 $1.020 1.3% Astros 60% -175 1.571 $0.943 -10.0% Dodgers 64% Diamondbacks 36% Nationals 52% -130 1.769 $0.920 -10.4% Cubs 48% 110 2.100 $1.008 0.7%