Closing prices efficiency (part Two)

In the first part of this series, we discussed how winning percentages change when the home win odds rise (meaning home winning % decreases). In this part, we will see what happens when we have lower home win odds and, of course, a higher winning percentage for the home team.

Again, I want to thank the people of www.football-data.co.uk for their great work. I took the data for my analysis from the Historical Data section under the URL https://www.football-data.co.uk/data.php.

My dataset has 62.917 records; each represents a unique football game from 2012-2013 to 2020-2021for 22 European football divisions; the odds are from Pinnacle.

The starting odds are gathered either Friday afternoon for weekend games or Tuesday afternoon for midweek games.

I created ten odds groups, basically the same I used in MATH to WIN: Footballto conduct a more detailed and reliable data analysis.

Odds groups

So, let’s get to it! The first table describes the full dataset and presents the winning % of each result combined with the capital return.

Table 1 - All games in the dataset

As you can see (and expect), there are losses for us almost for every situation. So we can suppose fairly accurately that there is a market efficiency in the closing prices; the bookies profit in every situation, mainly because of the overround.

Now, let’s see what happens if the probability of the home team winning the game increases more than 1% at the closing line (meaning the odds for the home win decreasing more than 1%).

Table 2 – Home win % increases more than 1% at the closing line

The actual winning percentages don’t follow the odds movement. Of course, we can see some variations, but we don’t see a clear increase in the real winning % for the home team.

Now, let’s see what happens if the probability of the home team winning the game increases more than 2% at the closing line (meaning the odds for the home win odds decreasing more than 2%).

Table 3 – Home win % increases more than 2% at the closing line

Same observations as ones from the previous table. The home team odds may decrease not to achieve market efficiency but may be moving due to large betting amounts on the home team. So, maybe there are profitable situations here.

You get the idea, but the next tables are more informative and useful.  I will present three tables with the home win, draw, and guest win probabilities and capital return when the probability of home win increases from +1% to +4% at closing time.

Table 4 – Home win capital return

The next table presents the capital return for the draw when the probability of home win increases from +1% to +4% at closing time.

Table 5 – DRAW capital return

In the group VW-Hw, when the home team starts as a very weak favorite but the home win odds drop at closing time, it is wise to consider the possibility of a draw. The more the odds of home win dropping, the more value we get if we bet on a draw.

Table 6 – AWAY WIN capital return

Here we can see a clear pattern! When the starting odds for the guest team are 1.80 and higher, you must consider betting on the guests if the home win odds are dropping. It is clear that the market is not efficient at closing time, but the odds are moving due to large amounts of betting.

In the next article of the series, we will deal with the guests’ teams’ odds, so stay tuned, check my books in the meantime, and don’t forget to click on the ads to see what our sponsors have to offer!

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