Submitted by Kelso Sturgeon on Tuesday, May 14, 2013 at 12:30 PM
As we continue working deeper into important concepts from my College of Advanced Sports Betting and Handicapping, I want to talk today about how the NBA playoffs differ significantly from March Madness and the NFL playoffs.
You’ve probably noticed that NBA lines have stayed fairly stable throughout the postseason. This is important because it means they’re NOT at the mercy of what’s called “recency bias” in the field of analytics.
During March Madness…lines can jump dramatically after a team has a great performance. Think about how much respect Florida Gulf-Coast started getting after their wins. Or, how about the San Francisco 49ers back during the NFL playoffs? When a team plays well on national TV, the lines move.
But, all the games in the NBA Playoffs are on national TV, and they’re staying stable. Why is that? Among the many reasons:
*The public doesn’t bet the NBA! The public is famous for overreacting to what they just saw on TV. And, the public loves betting on the NFL Playoffs and March Madness. The “recency bias” that shows up in Vegas pointspreads is directly connected to public betting action. Square money just isn’t in the mix right now. It might show up in later rounds when we get closer to crowning a champion.
*The NBA season is much longer than either pro football or college basketball, which means that both oddsmakers and sharps are very confident with how they’ve rated teams. Florida Gulf Coast came from complete off the radar. Wichita State hadn’t played many games against major conference teams. There are still question marks from the smartest people in the industry about teams like that deep into a season. There are no questions about Miami or San Antonio or New York. Assessments are locked in.
*Smart money is generally “contrarian.” That means, if oddsmakers DID show a tendency toward “recency bias,” sharps would just bet the other way immediately and drive the number back to where it should be.
At first glance, this might suggest to you that betting the NBA Playoffs is futile. Oddsmakers and sharps have what they consider to be very strong reads on all the remaining teams. Everyone’s played about 90 games this season! How can you beat the market when the market is that smart?
Let the Dean of Sports Handicapping tell you how!
*Focus on teams dealing with injuries. The market is still guessing (and often guessing poorly) about how shorthanded teams will perform. Pointspreads are staying stable partly out of oddsmaker arrogance rather than actual confidence in their reads of new lineups.
*Allow for the reality that “recency bias” isn’t actually a bias at all, but a true understanding of how a team is playing at the moment. Some teams blossom late in a season. Others implode. Some get guys back from extended absences, while others wear down from fatigue. Golden State covered eight games in a row (and now nine of 10 heading into Tuesday Night’s game in San Antonio), while Memphis is on a nine-game cover streak (after getting there in OT Monday Night) partly because oddsmakers and sharps have been too slow to recognize improved levels of play. I’d say it this way…the market often OVER-reacts to results in the NFL Playoffs and March Madness, but UNDER-reacts to results in the NBA Playoffs. (Wise Guys never took the Dallas Mavericks as seriously as they should have during their championship run).
I’m not suggesting the zig-zag is dead, or that oddsmakers are boneheads who don’t know how to line a game. I am telling you that oddsmakers sometimes make mistakes that they’re often too stubborn to correct. You could say the same thing about many sharps (particularly this year). Sports bettors and handicappers make their livings by finding these mistakes and exploiting them.
Keep that in mind as new developments continue through the postseason. Somebody else is going to get injured. A few more teams are going to hit a wall. A coach is going to make an adjustment that works…and keeps working.
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I’ll be back at the end of the week to read and react to either a major basketball story or something from Major League baseball. I’ll let the headlines between now and then determine the topic! Keep up the hard work. Please remember to print out all the coursework so you can build a virtual sports betting and handicapping textbook you can use for years to come.