The assistant professor of sport management and media analytics major shared their collaborative research examining sports betting – specifically season win totals in college football.
Faculty, scholars and students from across the country shared innovative research and discussions facing the biggest issues in collegiate athletics at the 2023 CSRI Conference on College Sport in Columbia, South Carolina. Among those on hand to present at the annual conference, held March 22-24, were Assistant Professor of Sport Management Alex Traugutt and Elon sophomore Bennett Lynch.
The professor-student collaborators shared a poster presentation titled “Exploring Efficiency and Profitability in the College Football Win Totals Market: A Heuristic-Based Analysis.” In recent months, Traugutt and Lynch, a media analytics major, researched sports betting in college football, specifically the efficiency and profitability of the season win totals market in NCAA football using a heuristic-based analysis.
According to Traugutt, sports betting markets have become a focal point for academic research to explore questions related to market efficiency and human behavior. An advantage of analyzing these markets, in comparison to traditional financial markets, is that the assets (bets) have a defined outcome at the conclusion of each contest. To date, most sports betting research has focused on individual game outcomes (e.g., point spreads), concluding that markets are generally efficient, with few opportunities for profitable returns. In contrast, season win totals markets, where bettors wager on whether a designated team will win more or fewer games in a season than the posted total line, have exhibited consistent inefficiencies and avenues for profitable returns.
As part of their study, the duo used a heuristic-based analysis to build statistical models that exploited bettor biases. For reference, heuristics are mental shortcuts individuals utilize to simplify their decision-making, often leading to judgmental errors (e.g., failure to account for regression, sentiment bias, and overvaluation). Results from the various models indicated that the market is inefficient, with several strategies yielding profitable returns, particularly from the under bettors’ perspective. While findings of inefficiencies are not uncommon, few studies have reported profitable outcomes.
“While applying economic and financial models to sports betting markets is not novel, there remains an opportunity for further development, especially given their continued increase in size and liquidity,” Traugutt said. “Moreover, as sports betting becomes more legalized on a national level, these markets have become an avenue for individuals to seek financial gain, similar to traditional stock markets. This research provides valuable insights into the dynamics of this market and the impact of heuristics on financial decision-making.”
Traugutt and Lynch formed their research partnership as part of an undergraduate research course, with the focus being on synthesizing information from academic articles, working with data, and summarizing the results from statistical models. Traugutt said that Lynch was enthusiastic throughout the research process and took an active role in discussing their findings at the CSRI Conference.
“Bennett is interested in the intersection of sports data and the rise in popularity of sports gambling markets, along with how human biases can impact financial outcomes,” Traugutt said. “When the opportunity arose to complete a research project on this topic and attend a conference that offered the ability to discuss our findings, he was eager to participate. Moreover, the ability to attend an event where practitioners and academics were discussing their research provided an opportunity to learn about various research topics impacting the field.”
Prior to joining Elon and academia, Traugutt worked in college athletics for five years in roles relating to sales and fundraising. His research focuses on the economics and finance of sport, as well as consumer behavior at the collegiate and professional levels. While Traugutt has studied sports betting markets in various sports, this was his first endeavor in this market specifically.
The College Sport Research Institute (CSRI) is a leading research center based at the University of South Carolina’s Department of Sport and Entertainment Management. The year’s conference, which celebrated its 15th anniversary, offered two-plus days of research presentations, panel discussions, teaching workshops, a case study competition and more. Conference topics included NIL, athlete identity, injuries, organizational culture, inclusion, mental health, and athlete academic and career success, as well as business-focused topics such as coaching impact, salaries and operating costs, collegiate apparel, and esports.