The Performance of Betting Lines for Predicting the Outcome of NFL Games

Abstract

We investigated the performance of the collective intelligence of NFL fans predicting the outcome of games as realized through the Vegas betting lines. Using data from 2560 games (all post-expansion, regular- and post-season games from 2002-2011), we investigated the opening and closing lines, and the margin of victory. We found that the line difference (the difference between the opening and closing line) could be used to retroactively predict divisional winners with no less accuracy than 75% accuracy (i.e., "straight up" predictions). We also found that although home teams only beat the spread 47% of the time, a strategy of betting the home team underdogs (from 2002-2011) would have produced a cumulative winning strategy of 53.5%, above the threshold of 52.38% needed to break even.