Basic concepts of MMA handicapping: Value

Actually, these concepts apply to all forms of sports handicapping but will be particularly helpful to newcomers interested in betting on UFC and MMA events.

Thanks to Savage Science managing editor Jim Murphy for this writeup and the one to follow:

Mixed martial arts is becoming a major betting sport, which is a very tidy convergence of my past and present vocations as a professional sports handicapper and fight sport journalism god. Not to toot my own horn, but I was one of the first handicappers to seriously work on MMA back when most people—bookmakers included—considered it more of a freak show than actual sport. For awhile, betting MMA was like a personal ATM machine—no one could set a sharp line on the sport, and my clients and I took advantage and made a lot of money. The bookmakers are getting sharper, but it’s still possible to bet MMA profitably.

Now, I’m not going to bore you with a sports betting theory lecture. I could prattle on for days talking about ‘true odds’, theoretical breakeven points, and other arcane concepts that have more to do with math than sports. I am going to preface this with a couple of important concepts of serious sports betting theory that you should keep in mind when betting MMA or, for that matter, any sport.

VALUE: To make money betting on sports over the long haul, you need to find positive line value situations or what we sports gambling types call ‘an overlay’. Simply stated, these are situations where the ‘true odds’ of an event occurring make the prices offered by a sportsbook favorable. The easiest way to explain this is to think of a coin flip which over the long term is a 50% proposition. Were a sports book offering +100 on one side of a coin flip, that would accurately reflect the ‘true odds’ of this proposition. Were a book offering ‘heads’ at +150 and ‘tails’ at -175, it would be a situation where ‘heads’ is a good wagering value and ‘tails’ a bad investment.

See what we’re doing here? We’re not so much trying to determine which side the coin lands on, but finding a price that puts the ‘true odds’ of a certain outcome in our favor. At +150, the theoretical breakeven point is 40%. At -175, it’s 63.6%. So keeping in mind that over the long term the coin flip is a 50/50 proposition, simply betting on ‘heads’ will make us money over the long haul. Conversely, laying the favorite price on ‘tails’ is, simply stated, a ‘sucker bet’.

Obviously, in the ‘real world’ there aren’t a lot of cut and dried instances where you know what the true odds of a proposition are like you do with a coin flip. That’s where all of the statistical and matchup analysis comes into play. Still, what we do when we handicapping MMA or any other sport is a more complex version of the ‘coin flip’ example above.

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