NFL Gambling as an Alternative Asset: Abstract

The following is the abstract from the paper “Using the NFL Gambling Market as an Alternative Asset Class” by Kevin Meers, Sam Waters, and Zack Wortman. Please find the full paper here. We will publish our projected probabilities each week before NFL games begin, starting for Week 2.

A particular focus of modern portfolio theory involves diversifying risk through identifying and investing in assets that are uncorrelated with one another. In this pursuit, many investors have explored so-called “alternative asset classes” that are not traded on major stock markets. In this paper, we identify the market for gambling on games in the National Football League (NFL) as one such alternative asset. By modeling various betting outcomes, we develop multiple betting algorithms that provide returns from 7% to 20%, depending on what level of risk the investor would like to assume. These returns are, in theory, totally uncorrelated with market risk, and therefore valuable to any portfolio manager; further, they appear to dominate multiple market indices.

 

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4 Responses to NFL Gambling as an Alternative Asset: Abstract

  1. Joe says:

    Interesting paper. Did you look at the returns if you adjust it for the bookmaker’s “juice”? Most spread and over/under bets are -110, so it’s not as simple as winning $100 or losing $100. It’s win $100 or lose $110.

  2. Pingback: NFL Gambling as Invetment Portfolio | Pro Football Hot Reads

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