Saturday, 17 July 2010

Stating The Obvious


It's not so much as whether you use ratings - elO or others - as to what you do with them. The elO numbers themselves are, in many ways, meaningless - Anon. (London)
Nevermind that the quote is on a post about Betfair's flotation plans, or that "Elo" proves once again too difficult a word for the anonymous mind to get right...

To be profitable from betting on sports, you need to be able to find an edge, which means that you need to be able to compare your rating of a selection (i.e the probability in your opinion) against the odds (implied probability) available on that selection.

How individuals reach their decisions is an individual choice. Elo ratings, form, historical performance, trends, weather, manager, trainer, jockey, "gut feeling", whatever - these are all inputs to the decision making process, and even if you your decision making appears not to be mathematical, part of the process of comparing probabilities means that it is. It has to be - probability is mathematical.

Unless you're an idiot, any time you place a bet, you have calculated the probability relative to the implied probability, and decided that the price is value.

To directly address the comment above, what you do with Elo, (or any other) ratings, is use them to assist in this search for value.

Of course an Elo number by itself is meaningless. I have Chelsea starting the new season with a rating of 2309. Obviously that information is totally meaningless.

I don't think anyone could think otherwise.

Ratings ARE meaningful for comparison purposes though. In horse-racing, Timeform ratings have been around for more than 60 years, and in the US, Beyer Speed Figures since the 1970s, and to be told that Dobbin has a rating of 120 in either method means nothing unless you know the ratings of its competitors, or the number is given some perspective.

For those who are anti-ratings, bear in mind that many experts and sports use rating systems. In the US, sports ratings systems are used to decide the teams in College Football who will play in the BCS championship game, or to determine the field for the NCAA Men's and Women's Basketball tournaments, men's professional golf tournaments, Pro Tennis, and NASCAR. FIFA ranks football teams, curiously based on Elo for women, but not using Elo for men.

I also keep Elo ratings for other sports including the NFL, NBA and NRL, sports where binary bets are available, calculating a handicap is relatively easy, and no pesky draws to confuse matters!

Not sure who will be able to use the Capello ratings though...

2 comments:

Neil said...

Looks as though Mr. Capello is not a happy bunny Cassini:

http://news.bbc.co.uk/sport1/hi/football/8831421.stm

Anonymous said...

(London)

Next step. Now you've stopped panning my last comment, why not have a think about how you could make the ElO numbers something less than meaningless.