Predicting The Score

I have been spending quite a bit of time at the bet your life blog over the past couple of weeks mainly in the chatroom.

Talking to other traders while trading adds a good dimension to the activity and the guys up there are good fun and willing to talk about some ideas.

Which brings me onto this post.

The other night I was discussing the Correct Score Markets and I decided to show them my price predictor for this market.

It's a very simple excel sheet where you enter what you believe to be the average goals for the home and away team in the table at the top.

The second table takes those averages and displays the probability of the home and the away team scoring a specific amount of goals based on a Poisson distribution.

The third table then takes the probabilities of specific goal counts and merges them together to create the odds for a specific scoreline.

While I just enter the average of the last 6 home matches for the home and away teams you could look at other factors that could modify the average.

i.e. If a striker is injured then deducted whatever goals he has scored from the average goal calculation.

You could also weight the goals scored by looking at who they were scored against.

i.e. A goal against Manchester United is worth 1.2 while a goal against Hull is only worth 0.7 but that is getting into a Rateform approach which I will talk about more later.

Take it for a drive and compare it to the prices on the exchanges.

I guarantee you will be surprised by the correlation between the predicted values from the excel sheet and the prices offered.

You will notice however that the most probable outcome is under priced on the exchange which could be an opportunity.....