Pools
Colossus Bets have a HDA5 offering. In this you predict whether the result will be Home win, Draw or Away win for 5 matches selected by Colossus. All money goes into a Pot. Colossus takes 30% as their share, they also guarantee a €1000 prize even if the Pot is not filled. The overall prize is divided equally among all those with the correct predictions. What is the best strategy here? Always pick the favourites? Pick the underdogs? Pick all Home? Pick all Draw?
I'm recommending these picks. Read on to see why.
Lets think about the Pool for a minute, a simplified version where there is only one match. Suppose the home team is favourite with a 50% chance of winning, Draw and Away are 25% each. The cost to enter is €2 and 1000 people enter. The operator pockets 30% of the pool money and divides the rest among the correct predictions. So there is a total €1400 left in the pool after the operator removes its share.
Thought experiment 1:
In this case the people playing the pool are not as well informed as yourself.
Every one picks at random - so 333 pick Home, 333 pick Draw and 333 pick Away. You pick the favourite. In this case if the favourite wins the dividend will be €1400/334 = €4.19. So in our simple example of an evens favourite you have a 50% chance of turning your €2 stake into €4.19. This would beat the bookies odds who will usually give you slighly less than even money on a 50% chance. Thus picking the favourite gives you a positive expected value.
Thought experiment 2:
In this case the pool players are all very football savvy and can discriminate which outcome is most likely.
Every one picks the favourite. In this case if the favourite wins then the pool is divided among everyone. Your return would become €1400/1000 = €1.40. This is not a good return on your €2. Thus picking the favourite gives you a very negative expected value.
Back to reality:
The reality is that the pool players will be a mixture of very well informed punters and not so well informed. The game now changes - instead of predicting the results - the aim is to predict the predictions. If most pool players are backing the favourites disproportionately then you shouldn't. If most people are making random or poor picks then you should go for the favourite.
Now after the pool closes Colossus helpfully gives us the breakdown of the units staked. So for example for Man Utd vs QPR there was a total of 672.828 units staked (you dont have to stake the full €2, hence the decimal places). These were distributed as follows: Man Utd win 558.547 unit (83%), Draw 82.091 units (12%) and QPR win 32.189 units (5%). Now if you calculate the adjusted implied probabilities based on the bookies odds then you could estimate Man Utd win was a 76% chance. (Man Utd were 1/4 on to beat QPR which equates to a 4 in 5 chance or 80% but need to remove the bookie edge to get our 76% estimate.) 83% of stakes on a 76% chance means that the favourite is over represented. The same analysis can be done for the other matches and it has been found that the favourite was always over represented in term of the stakes.
This makes sense, its natural to pick the selections that you think are going to win.
With more than enough people playing on the favourites, if the favourites win then you will be sharing the pool with too many people to make playing worth while. You are in a scenario such as thought Experiment 2.
So easy. Bet on all the underdogs - if you win then you won't have to share the pool. Lets see how that would work with the current offering from Colossus.
This looks good, if we win we wont have to share the pool. But think a little further - i calculate this outcome will happen something like 3 times out of 10,000. So if you play picks like this 10,000 times then you only expect to win the pool 3 times! A very bad expected value again! Even the bookie is offering better odds on this. Paddy Power would pay out €4095 on a €2 stake on such an accumulator (see betting slip below). From what we know about how the bookies edges accumulates like compound interest on accumulators and that the bookie offers poor value on underdogs - even at €4000 return this would represent a poor investment. Colossus is only guaranteeing a €1000 prize.
The answer is something in between. Pick the favourites then your share will be too small, pick the underdogs and then your chance of winning is too small. You need to pick the least likely outcomes (to ensure that you are a unique winner of the €1000) at the same time as making sure your picks have shorter odds than 500/1 chance of winning. Anything over 500/1 and your not winning often enough.
The below two picks I could recommend. Going by bookies adjusted implied probabilities they both have a positive expected value provided you don't have to share the pot. I think I like option 2 more - Celtic might end up being a popular pick, and there are less favourite picks in option 2. There is no guarantee that these will be unique picks. Actually since you know that I will be playing them it would be a bad idea. The point is that picks like these may be your best bet. In the weeks I have been following HDA5 500/1 shots like this have come in - the pool has generally not been won, or shared among 0.1 or 0.6 players. So going on history you would be winning the total pot or quite close to the total pot. Make sure you understand the small print though. Past performance is no guarantee for future performance.
For the Colossus guaranteed HDA5 €1000 jackpot, these picks are much better value than the bookies who would only pay out €496 for this accumulator.
Follow me on twitter @FoG_BLoG or read my blog at http://fog2014.blogspot.ie for more insights like this!
I'm recommending these picks. Read on to see why.
Lets think about the Pool for a minute, a simplified version where there is only one match. Suppose the home team is favourite with a 50% chance of winning, Draw and Away are 25% each. The cost to enter is €2 and 1000 people enter. The operator pockets 30% of the pool money and divides the rest among the correct predictions. So there is a total €1400 left in the pool after the operator removes its share.
Thought experiment 1:
In this case the people playing the pool are not as well informed as yourself.
Every one picks at random - so 333 pick Home, 333 pick Draw and 333 pick Away. You pick the favourite. In this case if the favourite wins the dividend will be €1400/334 = €4.19. So in our simple example of an evens favourite you have a 50% chance of turning your €2 stake into €4.19. This would beat the bookies odds who will usually give you slighly less than even money on a 50% chance. Thus picking the favourite gives you a positive expected value.
Thought experiment 2:
In this case the pool players are all very football savvy and can discriminate which outcome is most likely.
Every one picks the favourite. In this case if the favourite wins then the pool is divided among everyone. Your return would become €1400/1000 = €1.40. This is not a good return on your €2. Thus picking the favourite gives you a very negative expected value.
Back to reality:
The reality is that the pool players will be a mixture of very well informed punters and not so well informed. The game now changes - instead of predicting the results - the aim is to predict the predictions. If most pool players are backing the favourites disproportionately then you shouldn't. If most people are making random or poor picks then you should go for the favourite.
Now after the pool closes Colossus helpfully gives us the breakdown of the units staked. So for example for Man Utd vs QPR there was a total of 672.828 units staked (you dont have to stake the full €2, hence the decimal places). These were distributed as follows: Man Utd win 558.547 unit (83%), Draw 82.091 units (12%) and QPR win 32.189 units (5%). Now if you calculate the adjusted implied probabilities based on the bookies odds then you could estimate Man Utd win was a 76% chance. (Man Utd were 1/4 on to beat QPR which equates to a 4 in 5 chance or 80% but need to remove the bookie edge to get our 76% estimate.) 83% of stakes on a 76% chance means that the favourite is over represented. The same analysis can be done for the other matches and it has been found that the favourite was always over represented in term of the stakes.
This makes sense, its natural to pick the selections that you think are going to win.
With more than enough people playing on the favourites, if the favourites win then you will be sharing the pool with too many people to make playing worth while. You are in a scenario such as thought Experiment 2.
So easy. Bet on all the underdogs - if you win then you won't have to share the pool. Lets see how that would work with the current offering from Colossus.
This looks good, if we win we wont have to share the pool. But think a little further - i calculate this outcome will happen something like 3 times out of 10,000. So if you play picks like this 10,000 times then you only expect to win the pool 3 times! A very bad expected value again! Even the bookie is offering better odds on this. Paddy Power would pay out €4095 on a €2 stake on such an accumulator (see betting slip below). From what we know about how the bookies edges accumulates like compound interest on accumulators and that the bookie offers poor value on underdogs - even at €4000 return this would represent a poor investment. Colossus is only guaranteeing a €1000 prize.
The answer is something in between. Pick the favourites then your share will be too small, pick the underdogs and then your chance of winning is too small. You need to pick the least likely outcomes (to ensure that you are a unique winner of the €1000) at the same time as making sure your picks have shorter odds than 500/1 chance of winning. Anything over 500/1 and your not winning often enough.
The below two picks I could recommend. Going by bookies adjusted implied probabilities they both have a positive expected value provided you don't have to share the pot. I think I like option 2 more - Celtic might end up being a popular pick, and there are less favourite picks in option 2. There is no guarantee that these will be unique picks. Actually since you know that I will be playing them it would be a bad idea. The point is that picks like these may be your best bet. In the weeks I have been following HDA5 500/1 shots like this have come in - the pool has generally not been won, or shared among 0.1 or 0.6 players. So going on history you would be winning the total pot or quite close to the total pot. Make sure you understand the small print though. Past performance is no guarantee for future performance.
For the Colossus guaranteed HDA5 €1000 jackpot, these picks are much better value than the bookies who would only pay out €496 for this accumulator.
Follow me on twitter @FoG_BLoG or read my blog at http://fog2014.blogspot.ie for more insights like this!
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