Kevin Krieger and Justin L. Davis

A landmark decision (Murphy v. NCAA) by the Supreme Court of the United States (SCOTUS) in 2018 ruled that the federal government could not prohibit individual states from allowing sports wagering. Our study explicitly assesses the stock market’s response to this case’s progression through legal review phases, culminating with a landmark SCOTUS decision. Surprisingly, we find that the stock market failed to efficiently interpret key events precipitating SCOTUS’ eventual decision. Even though serious indications suggested that the Professional and Amateur Sports Protection Act (PASPA) was...Read more

Isabel Abinzano
Maria Jesus Campion
Luis Muga
and Armajac Raventós-Pujol

This paper transfers and adapts the Black-Litterman portfolio management model and its subsequent generalizations to the characteristics and specificities of assets quoted on sports betting markets. The results show that these assets are suitable for the application of portfolio management models with the possible inclusion of investors’ opinions. Information based on the variability of market prices and the attention received by NBA teams in Google Trends is successfully used to simulate the opinions expressed by a hypothetical portfolio manager. Furthermore, the assets are suitable for...Read more

Pascal Flurin Meier
Raphael Flepp
and Egon Franck

This paper examines whether sports betting markets are semi-strong form efficient—i.e., whether new information is rapidly and completely incorporated into betting prices. We use news on ghost games in the top European football leagues due to the COVID-19 pandemic as a clean arrival of new public information. Because spectators are absent during ghost games, the home advantage is reduced, and we test whether this information is fully reflected in betting prices. Our results show that bookmakers and betting exchanges systematically overestimated a home team’s winning probability during the...Read more

Jeremy M. Losak and Joseph Sabel

Home field advantage is universally accepted across most major sports and levels of competition. However, exact causes of home field advantage have been difficult to disentangle. The COVID-19 pandemic offers a unique, natural experiment to isolate elements related to home field advantage since all 2020 regular season Major League Baseball games were played without fans. Results provide no statistically significant evidence of a difference in home field advantage between the 2019 and 2020 seasons, evidence that home crowd support is not a driver of home field advantage.There does appear to...Read more

Ricardo Manuel Santos

Using data from all FIFA World Cup competitions that took place between 1994 and 2014, a step logit model is estimated to forecast the likelihood of success of each team in each tournament. The model correctly identifies the winner in five out of the six tournaments, and among many variables considered, key contributors to the model’s forecasting performance are identified. Using only the information available by the date preceding each of the last two in-sample World Cups, we can perform a more ambitious test of the model’s ability to forecast the winner at future tournaments. Our results...Read more

Yoon Tae Sung

This study investigates the efficiency of National Football League betting markets from 2002 to 2015 utilizing three rest patterns (Thursday Night Football, post-bye week, and regularly scheduled games). The logistic model indicates that inefficiencies due to the rest patterns occurred in Thursday Night Football and post-bye week games, with bettors expecting high rates of return. The forecast errors also provide evidence that point spreads did not correctly forecast future outcomes. Nevertheless, this deviation from efficiency was not sufficient to make positive returns from Thursday...Read more

Matthew Buckle and Chun-Sung Huang

A topic of ongoing interest is the level of market efficiency within sports betting. This paper analyzes the inefficiency embedded in the Super Rugby betting market. Robust methodologies widely utilized in the European football betting market are adapted and applied in our analysis of Super Rugby betting. Surprisingly, one in every three trades was found to provide an arbitrage opportunity, strongly suggesting at least weak form market inefficiency. We provide empirical evidence of differing odds quoted by bookmakers from different geographical areas, and show how such phenomena...Read more

Rodney J. Paul

This study extends the research on atmospheric conditions and scoring in sporting events by examining components of air density as it relates to National Football League (NFL) games. Statistically significant results were found in relation to the role of humidity in explaining the difference between actual scoring and the betting market total for NFL games. Simple wagering strategies based on humidity, wind speed, and a combination of these factors were shown to reject market efficiency. From game statistics, it appears that humidity may unexpectedly influence the rushing game, leading to...Read more

Bill M. Woodland and Linda M. Woodland

Sports betting markets continue to receive considerable attention from researchers regarding questions of market efficiency. The vast majority of papers have tested these markets with respect to the outcome of a single game. This article is the first to examine the National Basketball Association (NBA) season wins total over/under betting market. Woodland and Woodland (2013) investigated the analogous market for the National Football League (NFL), and found it to be sufficiently inefficient to provide bettors with profitable wagering opportunities. Betting rules are motivated by bettor...Read more

Rodney J. Paul
Andrew P. Weinbach
Chris Weinbach

A study of the physics of baseball has shown that air density plays a significant role in the distance a batted baseball will travel. Air density is a function of altitude, temperature, humidity, and barometric pressure. This paper tests if air density impacts the totals market in Major League Baseball by influencing the number of runs in a game above and beyond the betting market total. Through regression analysis and betting simulations of the 2012 season, it is shown that air density has an inverse relationship with total runs scored and simple betting strategies are constructed that...Read more