MLB arbitrage

April 4, 2016 04:00 PM

With opening day set for April 3, baseball fans were dreaming of World Series glory, while bettors were looking for a big payoff should their team win enough games to cover the line. 
For insight on what Las Vegas predicts for the year ahead, we turned to CG Technology, a Nevada-based gaming technology company that has revolutionized sports books around the world. The company’s CEO, Lee Amaitis, a former co-CEO at Cantor Fitzgerald, 
was the subject of a lengthy profile in Modern Trader last summer. 

CG Technology shared is lines for its sports books as of March 9 (see “Opening line”).

A quick scan of the data reveals some interesting opportunities. First, the Chicago Cubs are the odds-on favorite to win their first championship since 1908. With the league’s deepest roster and farm system, the stars might be aligning. But they’ll have to get through St. Louis and Pittsburgh to win last year’s toughest division. The Baltimore Orioles have seen their expectations slide in recent weeks. Alhough the team could shatter the MLB team home run average, a competitive AL East and downgraded starting staff overlooks the fact that the team has won more games in their division since 2012 than any other team. 

2015 

The World Champion Royals’ over/under appears a bargain at 84.5, but their odds to win it all are lower than teams with higher win expectations. 

Intriguing bets include the Washington Nationals. A favorite for years but a down 2015 led to managerial change. New manager Dusty Baker has playoff experience, but no title. Still strong pitching makes 87.5+ wins a good bet. 

Last year, the New York Mets’ odds to win the World Series were roughly 30 to 1. Who will be this year’s upstart? The Arizona Diamondbacks are going to make some noise this year, and 83 wins is an attractive line in a division that took a step backward this offseason, while this team dramatically upgraded its pitching staff. 

With that in mind, here is our fearless World Series projection for 2016...

About the Author

Editor-in-Chief of Modern Trader, Daniel Collins is a 25-year veteran of the futures industry having worked on the trading floors of both the Chicago Board of Trade and Chicago Mercantile Exchange.