Beginner question regarding opening/closing lines

[ctv1116]

Assuming that the goal of a sportsbook is to square their books (i.e. have equal money on both sides of a game, so they take little/no position on the game outcome), wouldn't it be true that the closing line is usually not the true line? For example consider tonight's MIN/LAA game lines (http://www.covers.com/sports/common/linehistory.aspx?sport=mlb&eventid=278010). As you can see, most of the books have moved their lines from around +135 to +125. Assuming the move in the line is market based and not information based, wouldn't the final line likely NOT be the the true odds?

[mrbaseball]

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most of the books have moved their lines from around +135 to +125. Assuming the move in the line is market based and not information based, wouldn't the final line likely NOT be the the true odds

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I'm surprised this line is as close to perfect as it is. Typically a "name" (Santana) gets way overbet skewing the line to his favor. I have +-140 as fair value with LAA favored. So this line is pretty close as far as I can tell.

The line either opening or closing usally isn't correct as far as true odds go. This is the puzzle handicappers need to figure out. Is the line right? The key for the handicapper/bettor is to figure what a fair price is and then bet accordingly if a divergance is found. Lines can move for all sorts of reasons.

I would say that this move is away from true value and probably due to Cy Young on the mound despite the fact he has been shaky lately while Byrd has been spectacular. I just checked Pinnacle though and it's still around +135 -140ish.

For what it's worth I see no value on this game from either side.

[mrbaseball]

I misread the line at Pinny and was looking at the runline /images/graemlins/smile.gif I haven't done my days handicap yet or really looked at lines yet. It looks like a cherry is being offered up on the Angels and Cy Young is getting waaaaaaay overbet. Lots and lots and lots of edge going for the Angels tonight!

[tech]

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Assuming the move in the line is market based and not information based, wouldn't the final line likely NOT be the the true odds?

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From my understanding of what you said, you have it backwards. Opening lines are softer than closing lines. That is, the market irons out inefficiencies in lines such that the closing lines are much better representations of true lines than the openers. This is generally true in all sports, although in games with high public interest the opposite can occur (for example the NE/Indy playoff game).

[ctv1116]

right, the point I was trying to make is that the bookmakers needs to overcompensate their mistakes in the opening line to ensure an even book.

[whipsaw]

I believe you still have it backward. You assume that they will overcompensate by moving the original line to some point past the true line in order to square the books. If they did that, they would simply be giving too much value to both sides of the ledger.

Let me use an example. Let's say an opening line on Team A at Team B was +110/-120. The line is incorrect, and should be a true 50/50 for a correct line of -105/-105 with juice. Bettors pick up on the mistake, and start betting the [censored] out of Team A. According to your theory, the sportsbook would correct this by overcompensating the line in the other direction to even out the money. That means that the new line would look something like -110/+100, or perhaps -120/+110. Now the public bets the [censored] out of B, and theoretically the book looks even because there is an equal amount of money on both sides. But the vast majority of the money has been on the side with more value, regardless of what side it was bet. If you have 50% of your money on one side at +110, and 50% of your money on the other side at +100 or +110 with two evenly matched teams, the book gets owned. Books can't overcompensate their lines. The lines get closer to true lines as the betting continues, so that the book can ensure that any FUTURE money is getting bet approximately on both sides.

Hope this helps.

[ctv1116]

so is the idea to get your money in early, because there will be less of an edge closer to the start of the game?

[tech]

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so is the idea to get your money in early, because there will be less of an edge closer to the start of the game?

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Yes, in most cases.

[RamGad]

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Quote:
so is the idea to get your money in early, because there will be less of an edge closer to the start of the game?



Yes, in most cases.


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Are you saying that most of the value in baseball is betting opening favorites early? I mostly bet dogs and find that closer to gametime, the price becomes better. (sometimes it peaks around an hour before gamtime, which I assume is related the lineups coming out). I thought the majority of people beating baseball longterm bet dogs late 80% of the time.

[STLantny]

From a couple threads at sharpsportsbetting.com (search taht site) it depends on what kind of games you are talking about. For big games, the openeing line is spot on, spot on = enough to try to get the action split, not the final outcome of the game. Then the line moves accordingly

[Mr_J]

This is irrelevent since books don't aim to balance action, but try to maximise their edge for the level of risk they are willing to take.