In this post we're going to look at some possible entry & exit points pre-match & in-play.
3)
Trading Opportunities – Pre-Game
The Odds for NFL games are essentially
established by Vegas (as in Las Vegas) – I use http://www.footballlocks.com/nfl_odds.shtml
and reflect not a book but what Vegas thinks are prices that will attract
punters. Both BF and Pinny reflect these prices but are then heavily influenced
by the market – the base is Vegas.
Most NFL games are not trade-able given
the poor liquidity, but the 5 televised games per week on SKY are liquid and the ladders are complete.
a)
Most
movements will take place on the day of the game (unless there is a injury to
the QB during the week) and are usually the result of an injury or rumour about
the teams Quarter Back – the most advance information you can get is from Tweet
Deck (Twitter) or the regular team injury reports available on the web – Pinny
and BF will not act immediately as the information takes time to filter into
the markets. Movements in respect of QB information can be upto 30/40 ticks for
the better teams.
b)
Teams also have a number of key players = mostly on
the Offensive side of the team – i.e. key running backs and receivers – a list
of these need to be on hand during the season so that any injuries during the
gameor training can be assessed for the next game. See http://www.ourlads.com/nfldepthcharts/depthchartpos/QB for a full list of
starting NFL players.
c)
Review
the pundits for mismatches between the BF/Vegas prices – i.e. where prices are
close – say 1.9 / 2.1 – and the majority of pundits are going for the 2.1 shot –possible
drift in the favourite on the day of the game.
d)
There
is a coin toss 3-4 minutes before the game which will determine which side will
have KO – this decision can move the price by 5 or 6 six ticks depending on the
game as the receiving side has possession and has the opportunity to score. Once the KO team and receiving team is known – either lay
the KO side or back the receiving side. This is a one off trade and needs to be
closed out before KO – you are trying to catch the swing directly after the
coin toss as prices reflect the change or continuation of possession of the football.
4)
Trading Opportunities – In - Play
a
) Some golden rules:
-
As
the result of the game is either win or lose – no draw – Backing one team is
the same as Laying the other Team.
-
The
basic principle that applies in tennis -where
you don’t back the server – is the same in most cases for the NFL - you don’t back the team in possession of the football as
the market has already priced to a large extent that they will retain
possession – i.e. the price will drift more if they lose possession than
steam if the team retain possession.
-
As
per my stats from 2014/2015 – 70% of the starting favourites will win whether they are home or
away. Out of the 256 games last year – 154 starting favourites were leading at
Half – Time (HT), 20 of these starting favourites ended up losing at FT,
however 42 starting favourites who were losing at HT ended up winning. Be very careful when laying a
starting favourite In - Play as their price may not come back.
-
The
prices will be more volatile during the second half of the game with prices
moving from say 1.5 to 3 with just a change in possession in the last 2-3
minutes of the game.
b) Using the
Stats to trade
-
In
the main prices move with a change or potential change in possession. The stats
to use here are First Down and Third Down performance - http://espn.go.com/nfl/statistics/team/_/stat/downs - this is the
ability of the teams Offense and Defence to convert / prevent First and Third
Downs – ( i.e. to retain possession the Offensive team has to move the ball 10
yards). Using the stats of both teams create the
position of the expected outcome – if the offense retain possession their price
will steam – if they lose possession their price will drift.
-
Fourth
Downs – in the main teams will punt the ball if they have not gained 10 yards
at the end of the third down. However where the team only needs 1 or 2 yards on
the 4th down – or near the goal line – a team will attempt a 4th
down (see link above for stats per team in 4th down
conversion/preventions). Using the stats of both teams create the position of
the expected outcome - if the offense retain possession their price will steam
– if they lose possession their price will drift.
c)Trading
Opportunities In - Play
-
The
Red Zone – this is where the Offense have possession 20 yards from the Defense
goal line. The prices have already anticipated that the Offense will score at
least a field goal – i.e within this range the Offense is already almost guaranteed
3 points – i.e. if they fail to score at 3rd Down and they don’t
need a touchdown (6+1 point) the Offense will be able to attempt a field goal
from at most 38 yards - this yardage is
calculated by adding 18 yards to the yardage to where the 3rd Down
has finished – i.e. if third down failed at the Defense 10 yard line – the
field goal attempt will be made from the 28 yard line. The nearer the goal line
the Offense can progress to - the more price will anticipate 7 points rather
than 3 points. If the Offense fail to get a touchdown or lose possession the
Offense price will drift significantly. Usual trade – depending on the strengths of the teams is
to lay the Offense when in the red zone given that the drift will be more than
the steam if the Offense fail to score a touchdown. Note that the Offense is
more likely to score within the red zone – so caution needs to be exercised.
The price movements in the red zone will be more volatile during the second
half and in particular if the scores are close.
-
Possession
in the last 2/3 minutes of the 2nd quarter approaching half-time. If
the team in possession of the football with 2 minutes or less to go in the
first half and also will be receiving the ball in the second half – this team
has effectively 2 chances to score – this will create a significant steam in
the price – as the market realises the situation.
-
The
receiving team from the second half KO - following from the point above –
should experience a small steam at the end of the first half as it will gain
the first possession in the second half – this steam depends on the relative
scores in the game – if the scores are close i.e within say 3 points the effect
will be more than say where the scores are 10+ points apart. Leave this trade
as late as possible as positions created too early are exposed to late scoring
at the end of the half.
