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Evidence for the Favourite–Longshot Bias in Football Betting Odds

Writing in the Scottish Journal of Political Economy (The Favourite–Longshot Bias and Market Inefficiency in UK Football Betting, 2000, vol. 47/1), its authors Michael Cain, David Law and David Peel in the Scottish Journal of Political Economy discussed evidence for the favourite–longshot bias in a sample of English and Scottish football league matches played during the 1991/92 season. Betting odds were from the bookmaker William Hill. Their findings summarised below.

In my book Fixed Odds Sports Betting: Statistical Forecasting and Risk Management I reviewed the evidence of the bias across European league football more generally, in which a sample of nearly 12,000 matches was analysed across the 2000/01 and 2001/02 seasons. Backing every home and away team with the bookmaker William Hill would have returned, on average, £0.87 for every £1 staked. By contrast, backing all home and away prices greater than 3.00 would have returned only £0.82 for every unit stake, whereas betting on all teams with an odds-on price would have returned as much as £0.93. Backing teams shorter than 1.50 would have lost only 4 pence for every £1. Repeating the analysis with a much larger data set taken from the 2005/06 to 2010/11 seasons using average prices recorded by the online odds comparison service betbrain.com has provided further confirmation for a demonstrable market inefficiency. This time, draw prices have also been included with home and away wins, creating a total betting odds sample size of 150,018. The results are tabulated below, first for average market prices, which reveal a strong bias, and second for best available market prices, which ingtriguingly are still not fully efficient which one might have reasonably expected (i.e 100% returns across the full ranges of odds).

Maximum betting price	Number of bets	Return
Odds ≤ 1.5	4,962	101.25%
1.5 < odds ≤ 2	16,341	99.13%
2 < odds ≤ 2.5	20,552	100.25%
2.5 < odds ≤ 3.25	29,886	97.73%
3.25 < odds ≤ 5	60,796	95.84%
Odds > 5	17,481	95.70%
All odds	150,018	97.34%

None of this, of course, helps us identify a meaningful profitable edge over the bookmaker with which to generate a profit. But it does at least show where uninformed punters are likely to make the biggest losses.

Next time: Evidence of the favourite-longshot bias in a tennis betting market.