Fading the public

Also if this does work as a strategy, then how does this work alongside the favourite/longshot bias? Surely the two can't exist together? You either have too much money on the fav pushing the odds in or not enough on the fav because of the f/l bias. Is one a myth?!

So if the weight of money is very heavy on the fav would you be inclined to back them and assume an informed market or would you be more inclined to lay them and assume a public bias? Similarly if there was weight was on the underdog would you assume an informed market and back the underdog or put it down to a fav/longshot bias abd back the fav? Anyone have any views on this?

Favourite/Longshot bias only applies to pool betting (tote) as far as I understand it.

Fading the public more applies to American Handicaps where people like to bet the favourite (the team giving points) and neglect to pay attention to the detail of the actual odds.

You'd have to do your own research to see how this applies to other sports such as tennis handicaps of course.

I certainly think for certain bets the name means the odds are lower than they should be. Like liverpool pretty much all this season. I've not calced it but I wonder if you'd be significantly in profit for laying them every game, Id imagine you would be, but blindly going against favourites .. don't know about that.

Weight of money I'm not so sure about. I'm sure there is some market manipulation with that that's got sfa to do with forecasting results.

It certainly used to be (and no longer is) the case that you could oppose the New York Yankees every week and make a profit.

*Every game

The favourite-longshot bias also pertains to bookmaker odds in the sense that on (for instance) UK horse racing you might be 10% on stakes down at the end of the season if you only backed favourites and 25% down if you backed selected 20-1 shots.

The bookmaker is taking out loss insurance against losing to an outsider b/c of information asymmetry. The true odds of a 20-1 shot in the book are likely to be much longer than 20-1, while the true odds of the jolly are on average only just over those quoted.

The Hong Kong horse markets (which operate on a tote system) famously show no favourite-longshot bias. This suggests that HK punters are more knowledgeable about the field than in countries where a more significant section of the public are betting indiscriminately and the bias obtains.