Originally posted on 04/30/2014:

#Warning
#TL;DR


In my experience, virtually all handicappers follow a similar progression. Each person advances only after 1) their current stage has failed them (-$), 2) they have realized the pitfalls of their current strategy, and 3) s/he makes a conscious effort to adapt.

Stage 1: Square betting

Strategy: Bet popular teams, heavy favorites, teams on win streaks, no consistent method for calculating value

Epiphany: You break your bankroll repeatedly

Lessons: Basics of calculating expected value, converting odds and probabilities, understanding variance, understanding how value is created in sports betting, money management, and vigorish

Stage 2: "Contrarian" betting

Strategy: Bet underdogs religiously, especially home underdogs, and some pretty terrible teams purely from a conceptual standpoint because they "must have value"

Epiphany: You realize that neither blindly picking heavy favorites nor heavy underdogs is profitable - you inevitably turn towards score projection and attempt to recreate the Vegas line yourself mathematically.

(Here, there is a key branch point: If your IQ > 120, you progress to the art of statistical analysis; if your IQ < 120 or you are too lazy, you either quit or become a degenerate gambler relying on a Stage 1 or Stage 2 strategy aka Pauly)

Lessons: Linear regression, Multivariate regression, Binomial distribution, Excel, Kelly criteria

Stage 3: Mathematical Modeling

Strategy: You develop a series of progressively more sophisticated and accurate ways for projecting the outcomes of games, which include the use of xFIP, park factors, etc.

(Now comes another critical developmental branch point)

Having spent a tremendous amount of energy refining multiple projection models clawing for the thinnest value you either:

#1 Convince yourself that you have an edge over the "square-betting public" because you are using an "objective, more scientific" method to make your picks and refuse to admit that your models are fallible. You ride your system to the grave before you quit.

or

#2 You find that your projections ultimately validate the accuracy of the Vegas lines +/- a small % error. You become unsure of whether it is even possible to profit long-term against the house edge + variance. However, you are driven by your love of the sport and personal curiosity toward the next level to sharpen your numbers and see if you can indeed exploit this small % error for some value, even though you know it likely won't be time-effective unless you have a very large bankroll.

Epiphany: ZIPS, flaws of linear regression, Non-normal distributions

Stage 4: Fancier Models, Game Simulation, and Beyond

Strategy: If you are intensely curious about the most detailed elements of the game, aspire to write for the Hardball Times, or Baseball Prospectus, or want to be employed by a Major League team, you will eventually reach this stage. At this point, baseball analysis is almost a full-time hobby.

This is the stage where for no good reason you find that you are able to answer questions such as, why is Joey Votto batting 2nd? How much does a 10 degree increase in temperature affect the HR/FB ratio? What is the game-theory optimal # of R-handed & L-handed hitters in your lineup, and how do you distribute them to avoid being exploited by specialist relievers? Why not start a R-handed reliever for 1 inning to face 3 Righties and then let the projected L-handed starter enter the game to face the lefty 4 hitter? When is slugging % more important than OBP and vice-versa?

Pitch F/X, Hitter spray charts and defensive shifts are the next level up from here. I don't work for MLB, or Hardball Times, or publish on Fangraphs, so I don't know how lucrative it is to even reach this point unless you want to be Joe Maddon's personal assistant - especially with so many internet heroes that publish great research for free.

Do you need to reach stage 4 to be reliably successful at betting baseball long-term? Yes, period. 20 years ago, from what I've read, you could have been a winner relying on a Stage 2 strategy. 10 years ago, if you were at Stage 3, you were likely in the upper percentile of sports bettors. Unfortunately, those days are gone.

Bottom line: don't be afraid to be a BEAST. If you aren't reading stuff that hurts your head to think about, then you aren't keeping up with me. And if you ain't trying to keep up with me, then why you up in my thread.