A Beginner's Guide Part 8: Understanding Correlation in Sports Betting
Adding an Artful Touch to Our Scientific Approach
Welcome back, sports betting enthusiasts! If you're new here, I highly recommend checking out A Beginner's Guide: Part 7 (and all my other posts in this series while you’re at it) for an overview of maximizing your sports betting strategies. Today, we’re diving into the concept of correlation and how understanding it can enhance your betting game.
What is Correlation?
In simple terms, correlation measures the relationship between two events. When placing multiple bets, in a parlay or same game parlay (especially), recognizing the correlation between those bets can be crucial. It’s like understanding how different elements of a game influence each other and using that knowledge to make smarter bets.
Positive vs. Negative Correlation
Positive correlation means that if one bet wins, the other is more likely to win. For example, if you bet on Justin Jefferson to go over his receiving total and the Vikings game to go over its total points, there's a positive correlation. If Jefferson exceeds his receiving yards, it's likely because the Vikings' offense is performing well, contributing to a higher overall score for the game.
Negative correlation, on the other hand, means that if one bet wins, the other is less likely to win. For example, betting on Lionel Messi to score a goal and Argentina to lose the match. If Messi scores, it boosts Argentina's chances of winning, making it less likely that they will lose. Hence, these two bets negatively correlate with each other.
Be Wary of Higher Vig on Same Game Parlays
When placing same game parlays, it's important to be aware that sportsbooks often charge higher vig (the bookmaker’s margin) on these bets. This means that the potential profit is reduced due to the increased cut taken by the bookmaker.
Sportsbooks understand that correlated bets are more likely to win together, so they adjust the odds and increase the vig to protect their margins. For example, if you bet on a quarterback to throw over 300 yards and his team to win, the positive correlation between these events makes the parlay more likely to hit. As a result, the sportsbook compensates by offering lower payouts compared to non-correlated parlays.
Why Understanding Vig Matters
Understanding vig is crucial because it affects your potential returns. Higher vig means the sportsbook is taking a larger percentage of your winnings. When placing same game parlays, always calculate the expected value (EV) and compare the offered odds with the true probabilities of the events happening together.
The Hidden Side of Correlation
Sometimes correlation isn’t as obvious. For instance, if you bet on the Chiefs to score 35+ points and Justin Herbert to throw for 300+ yards in a game against them, you might think it’s a negative correlation. However, it’s actually positive. If the Chiefs are scoring heavily, the Chargers will likely need to throw more to catch up, giving Herbert more passing opportunities.
Similarly, if you bet on Scheffler to go under his round total, you might assume it doesn't affect McIlroy's performance. However, both going under could indicate favorable playing conditions. Recognizing these subtle correlations can significantly enhance your betting strategy.
Always keep correlation in mind when placing bets on the same game or event. It’s ultimately up to you how much you want to factor it into your decision-making process. Again, this is more art than science.
Using the Devigger for Correlation
I’m not going to add much to this topic because the video on Crazy Ninja Mike is awesome. I highly recommend it if you’re going to begin devigging on your own. Again, there is some art of this but this will provide a healthy point of departure. For a detailed explanation of how to use Correlation on the Devigger, see HERE.
Wrapping Up
Mastering correlation isn’t just about recognizing patterns; it’s about using those patterns to make smarter bets and understanding the costs involved. By analyzing data, maintaining a critical perspective, and leveraging true correlations, you can enhance your betting strategy and increase your chances of success.
Remember, betting is not just about luck. It’s about making informed decisions. So, dive into the data, look for meaningful correlations, and use them to your advantage. Happy betting, and may you experience a day of positive variance!