Gambler'fallacy and value in football

[giraldi]

A few days ago I had a discussion with some friends about two very controversial topics.
I opened the discussion here because both topics are the basis for many betting strategies.
It's about "gamblers fallacy" and "value in betting"

 

There are probably just a few who don't know what we are talking about here, so I will remind them:

Value, in betting, appears when the odds are suggesting that the chances to happen the event are smaller than they really are.

And

according to Wikipedia: The gambler's fallacy, also known as the Monte Carlo fallacy or the fallacy of the maturity of chances, is the mistaken belief that if something happens more frequently than normal during a given period, it will happen less frequently in the future (or vice versa).

Now, the problems in discussion were, and I would appreciate your opinion

1.

We talk every day about value but is it possible to calculate the exact value for a price so we can tell if we will have profit on long run?

If we have the price 2.10 for 50% event like coin flip  it is a clear value and will have profit on long run  but,

For example we have 1.90 odds for home team win and we know with 15 minutes earlier than anyone else (my brother’s best friend is  brother in law with the wife-s manager) that the away team will play with the second team or something similar.  

On this particular situation the odds 1.90 is a certain value and should hurry to get it?  Why? Common sense tell us that should be value, but based on what? We bet based on common sense or based on value?  What is the probability for home team to win event? What way is calculated?

I agree that there are way more chances to have value but my opinion is that will never know if we bet with value or not. Until will see that checking the money into accounts of course.

2.

I have often warned about the danger of “gambler’s fallacy” but I was right regarding to betting on football?

We have an average team that won 5 in a row. Would be correct to start a strategy like Martingale against them?  At first sight would be terrible wrong if looking to “gambler’s fallacy” concept.

But, extremely important, the concept is about independent events. If there will be red 100000 times the next red/black will have the same 50% probability to appear.

This is the same thing for our team?  The next game is not affected at all by the previous games? Some players are probably getting more and more tired.  And many other similar things that affects next games.  

I am against Martingale in betting but my opinion is that is am extremely good strategy in some very particular situations.

 

 

Edited November 4, 2019 by giraldi

[froment]

Interesting discussion, but I'm afraid it will never have a definite answer, it is highly subjective matter, everyone has opinion and believes it is right.

1.

This all goes to personal skills on how to estimate the value and calculate your own odds... and bit of luck during the match itself; I remember few matches where one team had like 70% or 80% ball possesion and 20 shots on goal vs 2 shots on goal by their oponent, yet the oponent endured all attacks and materialized one of those two shots to win match 1-0, despite being completely outplayed.

Take as an example West Bromwich tonight; I am surprised to see it at ~2.30; based on table position and recent form, it should be 1.70, max 1.80. I see no major injuries on both sides, but they say that Stoke’s coach Nathan Jones has left the club; it means club is not satisifed with recent results and atmosphere is probably not good; so it brings the price down to 1.60, hence 2.30 is massive value.

However, odds compiler might be niece of that brother-in-law of manager’s wife, and have some insider information that mere mortals do not have, and argue that coach replacement is actually beneficial for players morale, hence they priced it as it is, 2.30.

So is it value or not? I don’t know now; I will not know in about 8 hours, when this match ends, either; I can only know after I placed a hundreds of bets on matches based on the same selection criteria – if I earned a profit after that amount of matches, yes, all my bets were value (and I probably do not care what’s the name for that, let alone to bother with selling those predictions, as some wise businessmen do); but if I lost money, I am not good at spotting a value; I might write nice analyses, present stats and reveal insider info, but if I don’t make long-term profit, there’s no value in my bets.

In other words, I do agree with your statement in last paragraph of point 1. :) Some they say good indication is movement of odds at Pinnacle – if you place a bet at odds which drop subsequently, you spotted value before Pinny; but at the end it has the same black/white outcome, no grey area there –you are making profit or you are making loss.

2.

Gambler’s falacy, in my opinion, is not applicable to football matches, or any other sport event, at all. It applies to independent events, as you mention, but in terms of football matches, independence means “lack of duration”, so to say. What I mean; white ball and red or black slots are absolutely the same throughout the process of spinning, they do not change from the moment of spinning the wheel untill it stops, probability of each event remains the same for that duration of time, 18/37 for black and red, and 1/37 for the house; you spin the wheel, and you are sure that those probabilities do not change in those dozens of seconds untill it stops. In a football match, however, even if there are two perfectly balanced teams from all aspects (including tiredness impact from previous matches that you mentioned), so we are sure that probability of each outcome is 1/3, each match lasts for almost 100 minutes and it will develop differently throughout that period – a key player can sustain an injury or receive red card after 5 minutes, a sloppy keeper can commit an own goal, an incompetent referee can make a crucial mistake, etc. – a lot of human, unpredictable occurences that send match beyond calculated probabilities.

In your example, if a team has 5 wins, is it worth laying it with Martingale? If that team plays in major, well known leagues, and odds are close to evens, as originally meant for Martingale, then yes, go for it by all means – I am pretty sure no team will ever win 100 consecutive matches in Premier league or La Liga (while I would not be that sure for, say, Ethiopian regional league... or even Serie A, I'm afraid), so that team is bound to fail to win sooner or later, and you’re bound to win those 10 quid at the end, provided that you start with 10 quid, you have bank comparable in size to that of Ronaldo, and you know a bookmaker willing to accept stake of ~10 million quid in case your team goes to another 20 winning streak, let alone if they go to all 100. :)

On a more serious note, it goes back again to available odds – Martingale is originally designed for even odds in each leg; whereas odds for each match fluctuate, hence you have to adjust the stakes each time; it doesn’t affect final outcome, but affects your stake, and thus number of matches you can afford

to bet on before you have to give up, either because of your bank, or because of bookmaker limit.

[harry_rag]

13 hours ago, giraldi said:

We talk every day about value but is it possible to calculate the exact value for a price so we can tell if we will have profit on long run? Rarely, for markets like who will win the toss or who will get drawn against who in cup competitions. Good luck in getting value in such "fun" markets though. Most of the time we're just using out own knowledge and experience and hoping that we're better than the other punters and the odds setters.

For example we have 1.90 odds for home team win and we know with 15 minutes earlier than anyone else (my brother’s best friend is  brother in law with the wife-s manager) that the away team will play with the second team or something similar.  

On this particular situation the odds 1.90 is a certain value and should hurry to get it?  Why? Common sense tell us that should be value, but based on what? We bet based on common sense or based on value?  What is the probability for home team to win event? What way is calculated? Much depends on how accurate the opening odds were and how significant the news is. On those rare occasions when we are the first to know about a whole team going down with a bug and being replaced by the youth team we can probably safely lump on without doing any further sums. One or two key players is a different matter though. I believe most punters overestimate the significance of team news.

I agree that there are way more chances to have value but my opinion is that will never know if we bet with value or not. Until will see that checking the money into accounts of course. True, though don't forget the option of paper trading before risking real money. I'm trying to adopt that approach more now, with bet types spending time in the "sandpit" before they go live with real money down.

We have an average team that won 5 in a row. Would be correct to start a strategy like Martingale against them?  At first sight would be terrible wrong if looking to “gambler’s fallacy” concept. I don't think I'd ever bet using Martingale for a variety of fairly obvious reasons but I would say that there's a good chance that any team on such a run would be priced too short in the expectation that they will be such an obvious selection for a lot of punters. There seems to be a tendency to focus too much on a small amount of very recent form and to underestimate how much of a part pure luck plays in football. Whether that presents a value opportunity to oppose them is another matter!

 

 

 

[OddsPredictor]

There is a difference between fair fixed odds events such as a roulette wheel and sporting events.

If 8 Reds come in a row on a fair wheel then we all know that this has no relevance to the next spin.

I mention fair as if not specified then eg if I toss a coin twenty times and it comes up heads everytime then there is a damn good chance it will be heads again.

However in sporting events that may not be the case for instance if Southampton let a lot of goals in when its cold and raining it may well be that the next time it is cold raining the probability that they will do so again may be higher than if it is a sunny day. But we may never know as there may well not be enough events to determine the validity of this hypothesis.

In fact I wonder whether there is such a thing as the 'True Odds' on a sporting event and searching for value odds as per my OddsPredictor is like searching for the holy grail. Sure if someone offers me odds of 10/1 against Liverpool beating Man City on Sunday I will take the bet as that is just an obvious error but what about if you are offered 2/1 is that value or not? Whatever you think and whatever the outcome you will never know whether it was a value bet or not.

Looking back at past data to test your value bets is also fraught with dangers of unintended influences on your choice and even paper trading has its problems as it is so easy to correct mistakes.

I try to use micro betting for my sandpit trials but even that has its problems.

What keeps me going is not whether I understand all the concepts but that my system keeps making me a profit albeit small. Maybe I have found the answer by luck.

Praise be to Fortuna.