Vegas Watch

Betting on baseball games is a lot different than betting on the other two major sports. Because of the relatively low scoring, there is no handicap that will even out the chances of either team winning. In almost every situation, if you make the better team favored by "-1.5" (win by two or more), they become the underdog. Because of this, the majority of baseball betting is done on which team will win straight up, and you have to take either improved or reduced odds depending on the situation.

I hadn't really given too much thought to this aspect of it, but a very well-spoken Covers poster (H/T: Money Line) makes some interesting points regarding how much one should place on their baseball wagers:

"I constantly see people say they flat bet baseball by using 1 unit as a base, and then risking enough to win 1 unit on a fav, and risking 1 unit on a dog. Example:

If you are betting a -115 fav, you bet 115 to win 100, and if you are betting a +160 dog, you bet 100 to win 160.

THIS IS NOT FLAT BETTING!!!!

Flat betting means that all of your bets have equal weighting, and this obviously puts high favs or high dogs at more importance than closer to even money favs and dogs."

Here is what he means. Say you bet on two teams- one is +150, and the other is +250. If you put $100 on each of them, which one would you rather have win? Obviously, the team that is +250. The point of flat betting, as the poster says, is for each bet to have equal weighting. Using this system, the +250 game is much more important to you than the +150 game. It will have a much greater impact on your bottom line than the other game- you are clearly willing to trade a win by the +150 team for a win by the +250 team.

People "solve" this issue by betting enough to win one unit on both favorites and underdogs. So if your unit is $100, you would risk $50 on a team that is +200, and $200 on a team that is -200. Again, this fails to have the desired effect. In this system, the closer you get to +100, the less important your bet. For example, say you bet on two games; one team is -200, and the other -500. Following this strategy, you'd bet $200 on the former game, and $500 on the latter. It is probably obvious at this point that the second game then becomes much more important to you. You'd much rather lose the first game and win the second (-200 + 100 = -100) than do the opposite (100 - 500 = -400).

The poster follows this explanation by noting a solution to this problem:

"I flat bet by taking my unit amount (1 in this example), and bet the amount that the risk + the win = double the unit size.

For example:

-120 fav: risk 1.09 to win .91

+150 dog: risk .80 to win 1.20

-200 fav: risk 1.33 to win .67

+180 dog: risk .72 to win 1.28

This way, every game has equal value and is true flat betting."

This is a little confusing, but makes a whole lot of sense. The proposed system allows each bet to have equal importance. This can be seen in the fact that if you know you're going to go 1-1, you don't care which bet wins and which bet loses. To show this, let's look at his first two examples.

For the -120 favorite, you're risking $109 to win $91. For the +150 dog, you risk $80 to win $120. If the favorite wins, and the dog loses, you'll win $91 and lose $80, putting you at +$11 for the day. In the opposite situation, you lose $109 on the favorite, but win $120 on the underdog- again, +$11. Each bet now has equal importance, so this strategy is truly "flat betting".

This thinking can also be applied to futures. If you think there is equal value in two teams, one of which is 5:1, the other 12:1, it doesn't really make sense in betting the same amount on either. With this system, you would bet $33 on the +500 line, and $15 on the +1200 line. This gets a little more complex when factoring in time value of money, but that's a discussion for another day.

The Covers post has more details regarding how to set this up in Excel, if anyone is interested.