Following on from my wonderings elsewhere as to whether Boston are good value at 31/1 to win the NBA championships, it occurs to me that if a team is 2 points better than it is rated this can have an accumulative effect as the prices for each of its hurdles are value and thus the accumulative outright price can be triple value.

Indeed, if nothing is known about the market other than it rates poorly in a given sort of situation then positive expectation might be gleaned just by looking at a middle-outsider sort of position in the market, as long as it was priced up to a reasonable total. Essentially, this sort of thing, which probably should be the subject of a more thorough treatment, is founded in the notion that your simple bet cannot have an expected value of less than 0% but CAN have an e.v. of more than 200%. The 'market key' is essentially that the variance-degree of mispricing is greater than the degree of over-round.

Therefore pairs (or more) of bets when it is known that one is greatly under-rated and the other greatly over-rated (but it is not known which one(s)) can be powerful.

In the real world this would come when no-one has much of an idea what is actually going on (NFL 'parity', perhaps?) and would also include the middle of the deviation. However, four 30/1 shots backed when one is actually a 10/1 shot, one a 50/1 shot and the other two genuine 30/1 shots is potentially a positive situation, and is not unrealistic if you are clever...

The 'market key' for these sorts of bets is essentially that the variance-degree of mispricing is greater than the degree of over-round. Whenever a 'regression-towards-the-mean' may have occurred (NFL off-season, perhaps) opportunities may prevail (think of a fair lottery-style drawing where punters have formed irrational opinions due to alleged 'form' factors...merely the knowledge that the market is off is sufficient to create positive expectation strategies without any actual ability to predict).

As a wise man once said: "...Don't tip me a winner, tip me a price!..."