Are you making any bets on this Sundays Superbowl?..........The Denver Broncos will cover. That’s what Analytic Investors has determined by measuring each team in terms of alpha, a word used on Wall Street, referring to excess returns a portfolio delivers beyond what models say it should, based on risk. For NFL purposes, the study takes a look at what would happen if you wagered the same bet every week on any given team to win, not including the spread. If you’d have done it all year, the Seahawks would have returned 13.7%. Not bad. The Broncos, despite the 13-3 record, only 4.6%. The best by far was Manning’s old team, the Colts, which would have earned bettors 51.8%. By the time the Super Bowl rolls around, the team with more alpha becomes overpriced, opening the door for a reversion to the mean. “Thus, as current two-point favorites, we think Peyton Manning & Co. will overcome Richard Sherman’s arrogance to win this one by at least a field goal,” writes portfolio analyst Matt Robinson. Hard to argue with the track record; it’s been right nine of the past 10 Super Bowls. The only one it got wrong was when the Giants beat the Pats back in 2012. And that helmet catch was a complete fluke.
Posted on: Fri, 31 Jan 2014 14:56:47 +0000
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