Tuesday, 28 March 2023

Aztecs, Owls, Hurricanes and Huskies

I ended the last post with a few lines about the end of season College Basketball tournament colloquially known as 'March Madness' and following the weekend's Sweet Sixteen (Round of 16 for most of us) and Elite Eight (Quarter-Finals for most of us), the excitement level in my house has risen dramatically with my wife's hometown Aztecs reaching the Final Four (Semi-Final for most of us) for the first time in their history, and as favourites (~1.8) to win their Saturday game against the Florida Atlantic Owls, they have a decent chance of making Monday's Championship Game (Final for most of us). 

I take full credit for their success after betting against them in both rounds! Florida Atlantic were 500-1 to win the National Championship at the start of the tournament, and are a number nine seed. The seeding system is a little odd because they have four of each seed number, four number ones, twos etc., so being a nine means ranked approximately 33rd to 36th, and as the tournament's "Cinderella" team, most of the USA will no doubt be supporting the underdogs. The reason for the four seeds is that the tournament is divided into four 'regions' of 16 teams each, with each region having its own 1-16 seeds.

With several upsets already, the highest seeded team left is UConn (University of Connecticut Huskies), a number four seed, with the San Diego Aztecs and Miami Hurricanes both five seeds. UConn are the only team to have reached this stage of the competition before having played five times previously winning four of them, and winning all four subsequent Finals, which is quite impressive. With an average winning margin so far of 22.5 points, it's hardly a surprise that they are favourites to win the championship at around 1.87. 

We only have data for nine competitions starting in 2013 but in Final Four (Semi-Final) matches, a total of 132.5 has historically been pivotal. Back the Overs when the total is above this number, and Unders when it's below it, and you'd have a 14-1 record with one Push. The totals are currently set at around 132 (Aztecs v Owls) and 149.5 for the later Hurricanes v Huskies game. 

Since I want to stay married, I take more than a passing interest in the Aztecs games, although the Arkansas Razorbacks will always be my college team, and this season the Aztecs' strength has been their defence. For example, in the Quarter-Final game they played Creighton who had previously averaged 77 points a game this season, and held them to 56 points. 

Friday, 24 March 2023

Retirement, Death, Anniversaries and NCAAB

It's been almost one month since my last update, and a lot has happened. The meeting in Phoenix I mentioned last month was delayed, I aged another year as did this blog, but most tragically of all one of my team at work passed away at the young age of 56. 

He'd booked a few days off work for a 'minor back surgery' and recovery, but he never made it out out of the anaesthetic. He went into liver failure, had some internal bleeding, extremely low blood pressure and passed away almost a week later. What made it even more tragic was that just two weeks prior to the surgery, his first grandchild had been born. 

All very sad, and one of those events that makes you reassess your life. When I heard from one of my Directors that he was having 'minor back surgery', I actually said to him that there was no such thing, thinking that he may have complications with his back, but never imagined the events that unfolded. 

With everything that was going on, I missed the February wrap-up and with the current month almost over, I'll combine the February and March summaries in a few days time. The blog turned 15 years old a couple of days ago, and I turned a little older than that. 

My trip to South Africa seems to have marked the end of an era and seems a long time ago now. I returned with a pretty firm retirement date of March 2021 in mind, but after a first quarter loss of 10.2% (a record) and a poor start to Q2, that date is looking unlikely. We'll see. One of the consequences of COVID-19 may well be an appreciation of what is really important in life, and while accumulating money is certainly important, it's only important to a point. It can't buy time.

As bad as March was, perspective is maintained by seeing that I am simply back to where I was last June, and last June I was pretty happy. In other words, things could always be a lot worse.

That 'firm retirement date' is still anything but. I had my annual review and while the percentage pay raise is fairly meaningless with my working days running out, the bonus, stock options and RSUs were of interest. As I've mentioned before, I'm in the rather enviable position of working from home most of the time, with 'working' consisting of a handful of Teams meetings with my afternoon calendar usually free by noon or early afternoon. The upside of walking away is minimal, but if / when they realise I don't do a lot and send me on my way with a severance package, I'll be quite happy. Speaking of walking, and the target of 2,023 miles in 2023 may need to be raised as I am already at 586 miles, putting those free afternoons to good use. 

First a little catching up to do, as while I reviewed the NFL's Small Road 'Dog System back in January, I don't believe I ever published the results of the similar College Football version.

Better late than never, and 'officially' we made a profit of 5.03 units (ROI 6.7% with a 41-34 record) but individual results will vary quite a lot in this sport with the matches available varying by sportsbook. The 'official' results are those that can be verified using the Killer Sports data. 

Over the past 18 seasons, the ROI is 9.2% in the recommended range with just two losing seasons, although two more would have been losers after accounting for the vig.
At the College level right now, all the focus is on 'March Madness', the end of season single elimination basketball tournament which is hugely popular. In recent years, Unders and the 'Dog have been the value bets with winning percentages of 55.3% and 53.6% respectively since 2016 although two years were lost due to the pandemic.

This season has seen that trend continue on the Totals with Unders hitting at a lovely 67%, but not so much joy for the 'Dogs with a 26-27-1 record. The tournament wraps up next weekend with the final on Monday 3rd April. Unfortunately my Arkansas Razorbacks were eliminated last night. 

Sunday, 26 February 2023

League Cup Final Profile

It's a rare League (Carabao) Cup Final profile for today's Manchester United v Newcastle United match with the Draw priced as third favourite. 

Of the last 18 finals, only the 2106 match between Manchester City and Liverpool had this profile and the game finished 1:1. Of the four FA Cup Finals with this profile since 2004, two games ended as a Draw.  

Over those past 18 matches, the ROI on the Draw is 50% (+9.03 units) and only one underdog (Birmingham City v Arsenal in 2011) has won in that time. 

Berkshire Hathaway Annual Letter 2023

The annual letter from Warren Buffett to shareholders in Berkshire Hathaway Inc was published yesterday. It's always published on a Saturday, presumably to allow time for shareholders to read 144 pages of wit, humility, wisdom and numbers over the weekend. 

I own some of their 'B' class shares, and so far so good with with them up up 3.3% in 2022, a year where anything positive was a rarity, and up 35.8% since I bought them a little over two years ago: 
One of my best individual holdings continues to be Warren Buffett's Berkshire Hathaway which I bought a little over two years ago and has quietly increased by a little over 37% in that time. It's not a jazzy holding, but it's a very solid one, and as regular readers will know, I'm a long time fan of Warren Buffett and his philosophy, although changes at the top for Berkshire Hathaway are unavoidable fairly soon with straight-talking vice-chairman Charlie Munger turning 99 yesterday.

The Class 'A' shares are currently priced at $461,705 and just one would be a rather significant percentage of my savings, but you only need to own a single 'A' or 'B' share to be eligible to attend the AGM in Omaha in person. 

While I have no plans to do so, the 'B' share is currently priced at a rather more manageable $304.02 and the AGM is a popular event with around 40,000 investors attending in person, and hotel rooms in town priced at more than triple the usual rate. 

Buffett's letters are always worth a read, and this year's is no exception. He pointed out that he's been investing for almost one-third of the country's existence, which is quite amazing. A couple of lines that caught my eye:
It’s crucial to understand that stocks often trade at truly foolish prices, both high and low. “Efficient” markets exist only in textbooks. In truth, marketable stocks and bonds are baffling, their behavior usually understandable only in retrospect.

And this one on stock buybacks, which appears to be targeted at a certain US Senator:

The math isn’t complicated: When the share count goes down, your interest in our many businesses goes up. Every small bit helps if repurchases are made at value-accretive prices. Just as surely, when a company overpays for repurchases, the continuing shareholders lose. At such times, gains flow only to the selling shareholders and to the friendly, but expensive, investment banker who recommended the foolish purchases. 

The key point here is the clarification that the repurchases need to be made at value-accretive prices. In October, it was reported that Meta, formerly known as Facebook, conducted a $45 billion buyback initiative at $300 a share. The only slight problem with this was that the stock dipped below $90 not long after!  

The letter also had some good one-liners as usual:
The world is full of foolish gamblers, and they will not do as well as the patient investor.

Patience can be learned. Having a long attention span and the ability to concentrate on one thing for a long time is a huge advantage.

Don’t bail away in a sinking boat if you can swim to one that is seaworthy.

There is no such thing as a 100% sure thing when investing. Thus, the use of leverage is dangerous. A string of wonderful numbers times zero will always equal zero. Don’t count on getting rich twice.

You have to keep learning if you want to become a great investor. When the world changes, you must change.

Some good advice there for all of us.   

Saturday, 25 February 2023

Sir Bernard Ingham

‘All right, Prime Minister,’ Ingham told her, ‘If that’s what you’re going to say I’m going to go outside and commit suicide.’ So she didn’t, and he didn’t.
I've mentioned a few times in this blog that I attended my first football match back in 1967 thanks to (later a Sir) Bernard Ingham, who was a neighbour across the road from my home in Old Lodge Lane, Purley. 

His son John was a similar age to me, and knocked on my front door one April Saturday morning asking if I would like to go to and watch football that afternoon. 

Parental permission was obtained, and the memories of that afternoon are forever seared in the memory. In those days Crystal Palace played in claret and blue, it was sunny afternoon, Palace won 2:1 (v Birmingham City), and I was hooked. 

As an event which changed my life, that afternoon was up there with the incident of the door handle, and it was personally sad to hear yesterday that Sir Bernard Ingham had passed away at the age of 90.

Long after I knew him personally, his comments about the Hillsborough disaster were of course indefensible, and his refusal to apologise for them after they were proven to be wrong even more unconscionable. 

Many will remember him negatively for his time as Press Secretary for Margaret Thatcher when she was Prime Minister, but when I knew him he was working as Press and Public Relations Adviser at the Board of Trade for Barbara Castle, and later for Tony Benn, and not long before moving south, he had stood as a Labour candidate for the Leeds City Council in 1965, and had a Labour / union background. 

He might have lost his way politically, but in regards to football it was the opposite as, when I first knew him, he was a Leeds United supporter, but he saw sense after a few visits to Selhurst Park and his son still goes to matches there. Perhaps seeing Leeds win just one of 17 games at Selhurst Park between 1966 and 1993 helped with the decision! With the Hillsborough comments in mind, it's an unfortunate coincidence that Palace host Liverpool tonight.  

Politics weren't much discussed on trips to the New Addington swimming pool on a Saturday morning, ten-year-olds have far more important things to talk about, but I do remember him getting a ticket for speeding as we left New Addington one day. Mind you, if you're at all familiar with New Addington you'll have some sympathy, as the desire to leave the place in a hurry isn't unusual! 

He also took me to my first Rugby Union match, though I'm not 100% sure where it was (I think Rosslyn Park), before they (the Inghams, not Rosslyn Park RFC),  relocated to the other side of Purley - the posh part - soon after. 

My parents, I think jokingly, often said they would never forgive him for converting their normal - I use the term loosely - son into a 'football crazy' boy!

I'll remember him as he was in the 1960s, a good dad, a good neighbour, and a man who certainly impacted my life in a way that I will forever be grateful for.  

Sunday, 12 February 2023

Big Foot

With Superbowl LVII this weekend wrapping up the NFL season this evening, attention turns to baseball with Spring Training for the 2023 MLB season starting in less than three weeks. The Regular Season opens on March 29th, but significant changes to the 162 game schedule means that the usefulness of some of the data from previous seasons is, at best, questionable. 

Since the Divisions were increased to six in 1994 , almost half of a team's schedule was matches against a divisional opponent with playing up to 20 games a season against each of them. That all changes in 2023 with every one of the 30 teams playing against the other 29 during the season and the number of divisional games dropping from 76 to 52. Interleague games see the biggest increase, with teams going from 20 matchups to 46.

As I've written before, with the universal adoption of the Designated Hitter (DH) rule, there's no longer any difference between the American League and the National League and rumours are that MLB may be headed to a 32 team league with eight divisions of four teams as is the case with the NFL.

For comparison, the NBA currently has 30 teams (six divisions of five teams) and the NHL has four divisions of eight teams.

In addition to completely revamping the schedule, there are some significant rule changes regarding the introduction of a pitch clock, (including a limit on pickoff attempts), restrictions on defensive shifting, and the introduction of larger bases - one of the justification for the latter being that "players' feet are much bigger now than when the bases were designed". The famous 90 feet between bases is no more.

These rule changes should all result in higher scoring. The larger bases and pitch clock will make it easier for players to steal bases, and the shift changes will mean that "more balls will find open spots leading to a higher batting average on balls in play and more action on the field."

As for the change in schedules, the data (courtesy of Killer Sports) shows how there are big differences in outcomes depending on whether a match is a divisional game, an inter-league game or a non-divisional intra-league game.

For example, blindly backing all road favourites in regular season games against an opponent they beat in the previous game gives a losing ROI of -2.5% from almost 14,000 games, but in inter-league games where the selection is an American League team (i.e. playing without a DH) the ROI is 7.7%. Such discrepancies are likely to no longer exist in the future since most of this data is from the days when the leagues had different DH rules so the performance of National League teams is somewhat redundant. Yes, when they would play in an American League park, they would play AL rules, but with relatively few such games in their schedules, this wasn't something they were too focused on.

Back to the Superbowl and good luck if you think you can find an edge on the biggest game in the US sports calendar. The last NFL game I saw live was a Monday Night game in Philadelphia (vs. the Green Bay Packers) with my son so I shall be supporting the Eagles for the second time this weekend. My money is on them giving 1.5 points as my gut tells me they should win by a lot more, but as I said, it's highly unlikely I have any edge on this game.  

Friday, 3 February 2023

Points, SGPs and January

We had no luck for the small road 'dogs in the NFL Championship games last weekend, and as The Guardian summed up the Philadelphia Eagles v San Francisco 49ers game:

Well, we were all expecting a closer game, but the 49ers had ridiculously poor injury luck with their quarterbacks and far too many costly penalties, so we ended up with a rout instead. That happens sometimes.
The Kansas City Chiefs v Cincinnati Bengals game was much closer, but we lost that one by a single point. C'est la vie. On to the Superbowl where the Eagles will play the Chiefs on Sunday week in Glendale, Arizona and wrap up what has been another profitable season in this sport. I am actually scheduled to fly to Phoenix for a work meeting later this month, but unfortunately a few days after the game so I shall miss out on the excitement that accompanies the event and my company will miss out on paying ridiculous sums of money for my hotel room.

ESPN had an interesting article covering the rise in interest in SGPs, Same Game Parlays which some of you may enjoy reading.
The days of placing a bet before a game and rooting for your team to cover the point spread are waning. The modern American betting market is full of player props, in-game betting and same-game parlays. Not even the long odds and the bookmakers' cushy margins are causing bettors to shy away from them. As we approach Super Bowl LVII, SGPs are as popular as ever.

This season, 46% of customers who bet on the NFL with a Kambi sportsbook placed a same-game parlay and 28% of all pre-game bets placed during the regular season were SGPs.

January is now in the books, and the EPL Draws had a profitable month (+1.19 units) with three winners from nine selections. In Spain's Segunda División, the similar Draw strategy had an even better month, with 19 selections generating 8 winners and 3.8 units of profit, while in the Bundesliga, the laying systems in the top division had a small profit, unfortunately more than offset by the loss in the Second Division resulting in a net loss of 2.21 units, although still (slightly) profitable overall on the season. 

The US winter sports continued to be a challenge in the new year, with the NHL and NBA systems all taking losses overall, although the NBA Totals System managed a small profit in January. Unfortunately February has started with four successive losses, so any hopes that the tide may have turned have been rapidly squashed.

Why the NBA has changed so much this season is debatable but the game is changing fast as reported by Axios last month:

Now for the boring, personal stuff. The bigger picture for January was quite positive, with my spreadsheet showing a 2.73% overall gain, and I'm now back to within a few hundred pounds of where I was at the end of October! Tesla was up 40% after a dire few months, Bitcoin was up almost 47% and Lloyds Bank close to 18% and the only real negative was that my company stock price was down. It's annual review and bonus month in February, so hopefully any options and RSUs will be awarded at lower strike prices. Retirement is proving elusive.

While the 40% gain for Tesla sounds impressive, the price is still about 50% off its high. As Ben Carlson puts it:

Dry Veganuary was successful, and while I wasn't strictly vegan during the month, consuming a little fish and cheese, I did avoid any meat or poultry all month and this, combined with walking / running 227.9 miles, resulted in a weight loss of 16.8 lbs, and my weight is now back to where it last was 4,100 days ago! Not sure how long it will stay here given the upcoming travel and a certain amount of catching up on my social life after a quiet January, but rest assured, you will know in four week's time. 

The correlation between weight gain / loss and calories ingested continues to be strong, with exercise making just a small difference. Consume fewer than 2,200 calories a day and I'll lose weight; more than that and I'll gain weight. And curiously the correlation between alcohol consumption and weight is strong too... 

Saturday, 28 January 2023

Cursed Profits and 17 Years of Benford

Three winners out of four last weekend for the 'Curse' / Unders selections, although with both rested teams winning their games, 'curse' may be a little too strong a word. Hopefully some of you were along for the ride.

This weekend (Sunday) features the Championship games for the two conferences, with the Philadelphia Eagles at home to the San Francisco 49ers for the NFC and the Kansas City Chiefs v Cincinnati Bengals in the AFC. 

Both home teams are small favourites - the Eagles are currently giving 2.5 points while the Chiefs are giving just 1.5 points and as in the regular season, the value in these games is on the 'dog. 

All-time in playoff games, when the Road 'Dog is getting 3 points or fewer, they are 18-5-2 ATS, and 12-1-1 in the NFC. As always, a caution that these are small sample sizes. 

At 3.4 the Eagles are currently favourites to win the Superbowl in two weeks' time. 

There were also a couple of winners for the 'Close' Draw System in the EPL last weekend, with two of the three selections finishing as Draws, and all three as Under 2.5. These are still down on the season though, by 4.15 units from the 38 selections so far and with no games this weekend, that won't be changing any time soon.

Finally, for those of us who love our numbers, here are the updated numbers for my daily betting profits (and occasional losses) from 2006 through 2022 for Benford's Law
Seventeen years! Anyway, the numbers correlate pretty well, at least for 1 though 7, before they go a little wobbly. 

Saturday, 21 January 2023

NFL Playoffs; Rest and Grass

Some of you may recall the post from last October which looked at whether receiving a bye was a gift or a curse, but as a reminder it's that weekend of the year in the NFL where the number one seeds from the regular season resume after a couple of weeks off. The sample size of games where one team has 7 or more days of rest than their opponent is not large of course, just 45 games, but I noted then that:

Another major sport that rewards its top regular season performers with a bye week is the NFL, and here the data since 2002 shows that the rested team underperforms with just a 36.4% record ATS.

The two rested teams this weekend are the Philadelphia Eagles (v New York Giants) and Kansas City Chiefs (v Jacksonville Jaguars) who are giving about 7.5 points and 9 points respectively. 

Both games are being played on grass, and while Unders is historically the bet on this surface in playoff games, in games where the home team has an extra week of rest, this has been the outcome in 64.3% of 28 such previous games. 

The Eagles v Giants game is also a divisional game and by now, we should all know about opposing the favourite in such games. 

Monday, 16 January 2023

Emotional Market

Although the sample size isn't huge, backing Away (or Road) underdogs in NFL playoff games is historically not the worst idea in the world with a 53.2% winning record against the spread and at least two winners in every season since the data begins in 2001. 

Already the current 2022 season has produced three such winners with the Miami Dolphins, New York Giants and Baltimore Ravens all covering. 

The Dolphins were getting 14 points against the Buffalo Bills, a number that seemed to me was possibly inflated by the emotional support for the Bills which followed the scare with Damar Hamlin a couple of weeks back. 

ESPN reported that:
The Miami Dolphins closed as consensus 14-point underdogs against the Buffalo Bills, making them the largest underdogs ever in a Wild Card game.

Since 2001 only two teams had been bigger playoff 'dogs, and while the value is usually on the smaller 'dogs, I took a chance that the market may have been wrong on this one.

ESPN continued: 

The game attracted the lopsided action on Buffalo, with the bulk of the money on the heavily-favored Bills minus the points and on the money-line (-1,000).

The Dolphins covering was good for the sportsbooks as well as those of us feeling contrarian about this game and not getting emotional. 

One more Wild Card game to go tonight - Dallas Cowboys (-3) at Tampa Bay Buccaneers  and all five so far have gone Over. 

Sunday, 15 January 2023

Superbowl Favourites in the Playoffs

With the NFL's Wild Card Weekend in progress, courtesy of SportsOddsHistory here are the fates of the Superbowl favourite at the start of the playoffs. I've converted the US odds to decimal, but the original is in the link above. 

I'm suspicious about the 2007 season where the New England Patriots are shown as 1.25 at the start of the playoffs, but the recent trend of favourites not doing so well is apparent, with just one clear favourite (Patriots in 2016 at 2.4) and one joint favourite (Seattle Seahawks in 2013 at 3.5) going on to win the Superbowl since 2004.
In the second game last night, I layed the Los Angeles Chargers at 1.57 after they scored the first touchdown, but after throwing four interceptions in the first 25 minutes and trailing 0-27, I gave up hope for any Jacksonville Jaguars recovery and went to bed, waking up to find out that the Jaguars had completed the third biggest comeback in playoff history and won 31-30. 
Just a fun bet mind you, unlike this reckless individual who won't have had a pleasant Saturday evening:


Tuesday, 10 January 2023

Milestones and Mountains

A rare comment on the blog earlier this year, from Hkibuzz who wrote:

One more year of the blog in the bag. Thank you for your entertaining and instructive posts, and all the best for 2023

I only managed 74 posts in 2022, which was down on the long term average but slightly up on the 2021 total, and the total number of posts all-time since 2008 is now closing in on 3,000.

The number of hits is also likely to reach a significant milestone this year with three million probable by June or July. 

If I make it to March, and I have every intention of doing so, the coming of Spring will mark 15 full years of the blog. If this was a marriage, I'd be looking at a crystal gift to mark the occasion. 

Thanks to Hkibuzz for the comment, which are always appreciated, and I'm always on the lookout for any general betting / investing blogs to add to the blog roll so if you have any recommendations please let me hear them. 

The number seems to dwindle year by year, as the challenges of coming up with interesting topics as well as staying motivated when losing money prove insurmountable. It's easy to be enthusiastic about a project when things are going well, but a few losing weeks will soon change that.

I'm slightly annoyed that my bet on Georgia -13.5 wasn't matched in the College Football National Championship game last night given that TCU lost by 58 points, (7-65), but hindsight is a wonderful thing. 

TCU were big outsiders to even make the College playoffs, not even quoted among the top 17 teams.

I wrote about the NFL Regular season yesterday, and in a further reminder that results will always vary slightly, the corresponding numbers from the Killer Sports database are:

Underdogs vs. spread:143-119-6 (54.6%)

Road teams vs. spread: 130-129-6 (50.2%)

Unders: 146-114-5 (56.2%)

Pretty close, and one interesting observation is that Unders had its best season ever (since 1989), and of these 34 seasons, three of the top four for Unders have occurred since 2017. The Unders on grass (as opposed to artifical turf) pitches was 59.4% and an incredible 69.6% (39-17-1) in the NFC this season.

In other (personal) news, with 900 miles covered on foot since the start of September, it's hard to believe that two years ago on this day, I was in a little discomfort after breaking my leg in three places. Yeah, yeah - don't go to those three places again... 

Anyway, I just quizzed my wife with "what happened two years ago today?" (she hates it when I do that), and when I told her, she said "oh yeah, remember when the ambulance guy thought you were my Dad?

I'd actually erased that part of incident from my memory for some reason, but clearly it made an impression with Mrs. C and was actually quite funny. Clearly the gentleman in question had left his glasses at home that day. 

Last summer's goal was to hike up Snowdon, something that I had long delayed after losing a friend in an accident there back in 1972. 

The news wasn't delivered in the most compassionate way. I can still remember my Dad reading the newspaper at the breakfast table and, prompted by the Purley reference in the report, asking me: "Do you know a John Twyford?, presumably not imagining for a moment that I did. 

After responding in the affirmative, adding that he went to the same youth club as myself, and asking why he would ask, he paused for a moment and then said "Well he's dead. Fell off a mountain." That's how we dealt with things in those days I suppose.  

This year we're targeting Scafell Pike in early July and if the weather permits, Helvellyn, which I last ascended exactly 50 years ago, although I'm hoping for better weather this time around, and I might be more prepared. 

Monday, 9 January 2023

NFL 2022 Small Road Dogs

The regular NFL season is over, and the Small Road 'Dogs System recorded its fifth consecutive profitable season with a 37-29-3 record, including four wins from five in the final round of matches. 

The Divisional System, which uses a slightly different definition of 'small', was also profitable for the fifth consecutive season, with a 23-20 record although had it used the same criteria for selections as the main system, the results would have been an improved 17-12 record. 

Sacred Manuscript subscribers who followed these systems will hopefully have made some money.

The NFL season continues next weekend with the Wild Card weekend and historically road 'dogs receiving fewer than 8.5 points are profitable in the playoffs, especially in the NFC. 

The New York Giants (at the Minnesota Vikings) and Baltimore Ravens (at the Cincinnati Bengals) currently sit within that point range. 

Two Road teams are actually small favourites next weekend, and historically teams in this situation have a 59% record ATS. 

Tuesday, 3 January 2023

X-Axis and Tesla Woes

In my first post of 2023, I touched on a couple of topics that have subsequently become more relevant.

One was that (about 2022) I wrote that:
This was my first down year since I started tracking these things in 2009, with my net worth total declining by 11.6%. At my age, this number is all about investment performance, with income from employment pretty much irrelevant.

This is a topic covered by Nick Maggiulli today, accompanied by a nice chart illustrating my point rather neatly: 

I'm at the extreme right of the x-axis above, and clearly while saving over 20% of my income doesn't hurt, how my investments perform is far more impactful to my net worth.

Interestingly, Nick's year seems to have been very similar to mine, although he is far younger. In this article he writes:

In fact, 2022 was the first year ever where I saw a decrease in my net worth from the year prior. To be specific, my net worth dropped by 11% in 2022 though my portfolio was down over 20%. What prevented my net worth from declining by 20% like the rest of my portfolio did? My ability to save money to offset my investment losses.

As I mentioned in my post, a reasonably large percentage (about 20%) of my portfolio is made up of investments in my company, which performed relatively well last year, although my main retirement account was down almost 20%.

That's four consecutive mentions of 20%, make that five, which must be something of a record! 

 The second topic I mentioned was that of Tesla, and I suggested that: 

"he [Elon Musk] seems to be having some kind of mid-life crisis and his political views, unpleasant to the majority of people, and certainly to his customer base, have likely reduced the demand for Tesla cars."

The stock ended the day down by 12.24% after the company:

"delivered fewer vehicles in 2022 than it initially targeted, capping a year during which the stock suffered its worst annual performance as demand appeared to soften and Covid-related production disruptions persisted."

Not the start to the new year I was hoping for, but a tremendous buying opportunity, or is the stock headed for under $100 shortly? Time will tell. 

Ken Block

2023 hasn't started well with the terrible news that Ken Block was killed yesterday in a snowmobile accident in Utah at the age of just 55, leaving behind three children. Ken was more recently famous for his rally driving and stunt videos, but was a business partner of my wife's brothers founding DC Shoes in 1994, a venture that worked our rather nicely for them.

He died doing what he loved to do, lived an extremely full and active life, and while I look at my Dad and his quality (or lack of quality) of life in his 96th year and understand you can live too long, passing at 55 with teenage children is much too young and very sad.  

In other bad news yesterday, the NFL's Monday Night Football game between the Buffalo Bills and Cincinnati Bengals was abandoned after the Bills' Damar Hamlin collapsed on the field in the first quarter after making a tackle and going into cardiac arrest. He required CPR for eight minutes and resuscitation but reports today suggest that his vital signs are back to normal.

While American Football is a brutal game, only one player has ever died during a game - Chuck Hughes of the Detroit Lions in 1971 in a game that was played to its conclusion against the Chicago Bears.
Some reports suggest that the NFL initially wanted the game last night to resume, but it was clear that many of the players were in shock and not in a fit state to play. Not a good look for the NFL if true. 

Both of the above events are jarring reminders of how fragile life is, and how important it is to maintain perspective and and understand what really matters in life. And it's not winning or losing your bets.

Monday, 2 January 2023

Eyeballs on 2023

2023 is not only the second consecutive year that is a harshad number and it is also an Eyeball Year since its binary representation only contains two zeroes and they are consecutive.

2023 is also a number that can be formed using the digits from one to nine in sequence:
Fascinating, I'm sure you'll agree. Maybe.

As I wrote in my opening post of 2022, Harshad is a Sanskrit word which means 'joy-giver' and while I commented at the time that "hopefully the year will live up to its categorisation and do just that", for many of us it didn't. 

Looking back a year, and it seems that not much has changed in the past two years. I wrote a year ago:
As for the year just gone, much of what I wrote in my review of 2020 a year ago remains true.
My job isn't really work these days. It's all meetings and management and if I can do it full-time from home, and by full-time I often mean for two to three hours a day, then I might as well hang in there until the next bonus and stock options are doled out at least, which is next month. Were my job hacking away at a coal face, my attitude to retirement might be a little different.
I'm getting boring. A year on, and I am still working, with retirement presumably closer, but motivation to pull the trigger is still very much tempered by the fact that I do very little actual work. My office was closed in 2022, so aside from the occasional work trip, and due to cost cutting, those haven't been so plentiful, all the work I do is from home. The possibility of a 2023 trip to India has been mentioned, and that would be an incentive to stay, but I am starting to consider the end of June as a good retirement date. 

My daughter is expecting her third child, and my fourth grandchild, on the 30th June, which is an extra nudge towards that date, but knowing myself as I do, it will all depend on how the stock markets perform in the next few months and how much of a golden parachute I can negotiate. 

Two of my peers were let go in November, and while I don't know exactly what redundancy terms they received, it was probably somewhere between 6 months and a years salary, either of which would suit me just fine. I complete 20 years of service with my firm in a few days, so I would expect to be close to qualifying for a year's money based on the formulas I have seen when having to lay people off myself, but if the decision to walk away is mine, I'm not sure how generous they might be. 

While work isn't exactly onerous as I've mentioned, I do need to keep an eye on the clock, as the good years of retirement can quickly evaporate. While I still feel physically good today, it might not be that long before the leg I broke in 2021 develops arthritis, or something else happens in an instant that reduces or removes the ability to travel. 

Psychologically I know that I need to be close to, or at, an all-time high but 2022 wasn't helpful. This was my first down year since I started tracking these things in 2009, with my net worth total declining by 11.6%. At my age, this number is all about investment performance, with income from employment pretty much irrelevant. 

I did warn myself a year ago that:
Of course the stock market will crash at some point, but predictions have been out there for at least eleven years now, and if you'd moved to cash at that time, I'm pretty sure you wouldn't be too happy.  
We've all been rather spoiled over the past two decades with low inflation, and a bull market that aside from the crash of 2008 saw the FTSE100 index decline by more than 6.5% just twice, and the USA's S&P500 index never, until 2022 when it dropped by 19.4%. Last year was just the second time (2016) since the crash of 2008 when the FTSE100 index has out performed the S&P 500 index, which readers will know has been my preferred index for many years.

One interesting observation from A Wealth of Common Sense is this:
The stock market probably won’t give us “average” returns. Depending on the time frame you use the long run annualized return for U.S. stocks is something in the 8-10% range.

The strange thing about investing in stocks is any given year rarely gives you anything close to that range of returns.

In fact, going back to 1928 there has been one single year of returns that fell between 8% and 10% (1993 when the S&P 500 was up 9.97% in total on the year).

Most of the time the stock market is up big or down big on the year. From 1928-2022, 70% of all years have seen double-digit gains or losses.

A great example of how averages, at least in the short-term, are often not very useful. 

As for my individual stocks, Tesla had a terrible year, with it's CEO Elon Musk  going from an absolute hero to a complete zero in the space of a few months. After closing at 352.26 last year, the stock is now priced at 123.18, a decline of 65%

Tesla is still my best performing share, up 488% since I purchased them in November 2017, but the distraction of buying and running Twitter, along with Musk's need to finance the purchase by selling Tesla stock, has clearly had an impact.

Musk has always been a bit of an odd character, but he seems to be having some kind of mid-life crisis and his political views, unpleasant to the majority of people, and certainly to his customer base, have likely reduced the demand for Tesla cars. 
Unfortunately the Tesla board is comprised of "Elon Musk, his brother, and people they control. It’s a public company in name only, and is controlled by a clique of insiders. It will be shocking if they move against him."

After cashing in some of the shares a year ago, I am now playing with house money and can watch from the sidelines, but what was looking like a great investment at one time has now become an interesting one to watch for all the wrong reasons. 

I've mentioned in the past that I invested a small amount in a Bitcoin trust, and that has preformed terribly with cryptocurrencies in general struggling after the recent FTX scandal. I know exactly why I dipped my feet into Bitcoin, simply a FOMO play, but  since they are not income producing assets, “investing” in crypto is purely price speculation, or gambling, and I'll not be adding to my position. 

One of my best individual holdings continues to be Warren Buffett's Berkshire Hathaway which I bought a little over two years ago and has quietly increased by a little over 37% in that time. It's not a jazzy holding, but it's a very solid one, and as regular readers will know, I'm a long time fan of Warren Buffett and his philosophy, although changes at the top for Berkshire Hathaway are unavoidable fairly soon with straight-talking vice-chairman Charlie Munger turning 99 yesterday. 

Of course with my stock, stock options and RSU holdings, my company's performance and share price is hugely important, and while a repeat of 2021 was always unlikely, a year when the stock was up 45%, it did at least manage a market beating 5.6% increase in 2022.  

For sports investing, 2022 was a steady year with a total gain of 5.28%. The glory years of 2006-2014 are a distant memory, but it's still possible to make steady profits with a disciplined approach. The markets for US sports appear to be evolving rapidly as the betting landscape over there changes, but the loosening of betting restrictions in many states was always likely to be disruptive. 

The 2022 College Football season is almost over, with a few Bowl Games and the Championship game next Monday where Georgia (-13.5) are favourites to beat TCU. The Away Small 'Dogs System 'officially' recorded a 41-34 winning record, an ROI of 6.7%, but as detailed back in October, Killer Sports doesn't include all college matches and individual results will therefore vary. (Individual results will always vary, depending on the time selections are identified, and the method by which they are sourced.)

The NFL season is still ongoing, with the regular season ending up next Sunday, but at the end of 2022 the ROI was 9.5% with a winning record of 31-24-3 with the related Divisional System recording a 17-15 record for a 3.7% ROI.  

So American Football was again profitable, but it's not the same story in the NBA where both of my systems are struggling quite badly. The Road Team System is currently down almost 20%, and a first losing season since 2005 looks certain.
The main reason is that overall, Home teams are having their best season since at least 1995 (when records began), with the results for road teams playing on short rest (two or fewer days) against opponents who won their last game also an outlier.

The Overs on High Totals System is also struggling this season, with an ROI of -14.1%. While the number of points being scored per game is the highest since the 1969-70 season, the market appears to have adapted to the higher totals being set. 

The NHL System started badly with losses in both October and November, but normal service was resumed in December and at the turn of the year, the system is 'officially' in profit, albeit by just 0.3%, but after trailing early on, this feels like a much bigger gain than it looks on paper.

Turning to football and while the Draw System in the EPL is currently down 5.33 units (from 29 selections) the similar Segunda División Draw System is currently up 7.89 units (from 78 selections) this season. 

The World Cup Draw System was again profitable as I mentioned in my last post, up 24% overall and up 94% on games with no team odds-on at fair prices.

In the Bundeslayga, the laying systems continue to generate slow and steady profits and are currently up 4.30 units (ROI 1.49%), and that's about it for sports betting, at least for those systems detailed in the 'Sacred Manuscript'.

As I mentioned in my last post of 2022, my goal of 1,200 miles on foot proved too easy, and was initially bumped up to 2,000 miles before I belatedly realised that 2,022 miles made for a more interesting target, and the final total was exactly 2,023 miles.  

Health will continue to be an area of focus in 2023, with my 'miles on foot' target 2,023 miles. I'm in a good routine and if I can stay healthy, this is again achievable. There's little point in trying to make money if your health isn't as good as you can possibly make it. I enjoy the time outside, and listening to podcasts certainly makes the longer walks go by easily. I love the time alone, with the mental benefits just as important as the physical. 
While exercise is of course good for you, for weight management it's mostly about the calories ingested as I have mentioned before. 

January is the 28th month I've been tracking these numbers, and while the net calories (ingested minus active calories burned) has a correlation of 90%, weight loss v ingested calories on its own has a correlation of 89.7%. 

Alcohol totals and total days are also highly correlated to weight gain or loss, and one new year resolution is to cut down on 'junk' drinking - those days when I go out for a few beers just because a friend texts me. I'll save my beers for special occasions as much as possible but a Dry Veganuary should get the year off to a good start.

Unfortunately I have a propensity to gain weight if I don't watch my diet, with the scales measuring a gain of almost 11lbs after returning from a very enjoyable Xmas break with family. Overall I lost 19.2 pounds in 2022, so the goal in 2023 is to drop those 11 Xmas pounds in January, and another 10 through to the end of November when it all goes (literally), pear shaped again!

Stay disciplined and good luck in achieving all your goals in 2023.