How to Bet Money Line Markets
Money line markets can be a little confusing, intimidating, and frustrating. But if your strategy is "bet the team you think wins" or "bet favorites in a parlay", allow me the chance to show you why that might not be the best idea. Maybe you've been tracking your wagers (everyone should!) and have seen that money line markets have been kind to you, so you're already aware of this. Either way, let's do some math! I'll try to keep it understandable.
Let's say the Yankees and Dodgers are both at home against the A's and Pirates, respectively. We all think the home favorites will win, naturally, but we're aware that sometimes upsets happen. Let's say each home team wins 70% of the time -- that would be a 113-49 record (playing every game against these teams and at home) which seems fairly reasonable. You can get an estimated win probability from a variety of sources (including right here!) but for the sake of this exercise, let's pretend we know this 70% is fact.
Here comes the thing with money lines -- just like in point spread markets where how many points you lay (or get) matters, in money line markets the price *really* matters. Let's say both of these teams are priced at -300, which seems steep, but goodness... those are two really good teams against bad ones at home, and we know they win 70% of the time, so it should be a good bet, right? Not exactly -- if you make this bet 10 times, you win 7 (and on $100 wagering where you'd bet $300 to win $100) of them for a nice $700 profit. Unfortunately the three losses would cost you $900, and on these 10 games you just got yourself a $200 loss, or -6.7% ROI.
But not many of us would bet the -300 straight anyway -- those odds aren't exciting and it's a lot of risk for not a lot of reward. So let's parlay them! They should each win and the payout gets better, so that should be a good bet, right? Hang with me on the math, but since these two games are independent, we can calculate the probability they both win to be 0.7 * 0.7 = 49%. Not bad to win the bet half the time! Here's the issue -- if you parlay two -300 teams, the odds are -129. You already know where this going, but let's finish off the math. If we do this ten times, the five wins net us $500 but the five losses cost us $645 for a $145 loss... and an even worse -11.2% ROI!
This is why parlays can be dangerous -- if you have negative ROI plays, the parlay accelerates your losses. It's also why I preach that bad plays don't get magically better just because they're in a parlay. Good plays are good plays no matter how they're done, and bad plays are bad plays just the same.
So what do we do then? Let's consider a slightly different scenario and illustrate just why the price matters. Same teams, same games... but instead of having to lay -300 we find a book (and maybe at a different time too) offering these games at -210. Still steep odds, but not as bad. Now if we consider the same situation as above, we still win 7 times and lose 3, but that $700 profit is only offset by a $630 loss. Now we have a $70 profit and a nice little 2.3% ROI!
Hopefully this illustrates the reason why we shouldn't be solely concerned with who wins when betting money lines.