becoming a sports trader

8/2/2019 Becoming a Sports Trader

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Becoming a Sports Gaming Trader: How to StopGuessing and Gambling and Start Analyzing and

Tradingand Winning!

ByGregory Wolfe

Authors note: Although American professional football was used in thisbook as the context to aid in explaining concepts, pointing outcorrelations, and describing products, the services and products thatare offered at sportsactioncharts.com can be universally applied to allsports that are wagered on in accordance with local laws.


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Becoming a Sports Gaming Trader: How to StopGuessing and Gambling and Start Analyzing and Trading

you will never look at sports gaming the same way again!

Who we are

Sports Action Charts, LLC is a Sports Speculation Analysis group that is managed by asmall team of former on-floor equity options market makers (US and European), off floor equity/options speculators, market technicians, and developers of proprietaryfinancial analytic software tools. The analytic tools developed by the team at SportsAction Charts have been used by major Wall Street technological and trading firms overthe past fifteen years. The managing members of SAC have over 40 years of combinedexperience in market making, trading, consulting and technological development.

What Happened

In addition to being a seasoned trader and market technician as well as market drivenauthor and instructor, one of the founding members of Sports Action Charts is also an

avid sports handicapper and champion of the psychology of crowd driven markets. Itcame upon him, in a moment of clarity, that the realm of sports handicapping was afinancial market like any other. And just like equity, currency, commodities markets,etc, the players success in this market could be markedly improved by the introductionof user friendly analytic technical software. In an effort to give players a real chance touse their own power of analysis that is free from their own emotion, free from thescamming of touts and tipsters, and free from the inability to gather adequatefundamental data on all possible events, the software team got to work to create viableand helpful products like the ones that the wall street sharpies have used to generatehigh confidence interval, income generating trades for years.

The Market Maker and the Book Maker (very important to understand why asportsbook works the exact same way as a financial market)

First and foremost, it is important to realize the reasons why the sports handicappingmarket is a financial market and how it possesses all of the major qualities of such. Thesimilarities begin with the market maker and the bookmaker. On trading floors where


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financial instruments are bought and sold, there is always a monetary gap between thebid price (the price where a customer can SELL a security) and the ask price (the pricewhere a customer can BUY a security). The market maker is able to BUY the security atthe bid price and he is also able to SELL the same security at the ask price, effectivelyallowing the market maker to profit, WITH NO DIRECTIONAL RISK, by the amount

between the bid and ask, as many times as the orders can be matched as per publicdemand. The fair value of a security is determined as the mid price of the bid/askspread based on the perceived value of the security by the public. In other words,trades only happen when there the demand to sell the security on the offer is equal tothe demand to buy the security on the bid. This enables the market maker to profit,RISK FREE. It should be noted here that the reason for a market makers existence is tosupply liquidity to the market, meaning that he is there to increase the probability thatBUY and SELL orders from the public are executed, and since he does not want to beexposed to DIRECTIONAL RISK, increased buying pressure will increase the price so thatthere will be more motivation for sellers, and increased selling will decrease the price sothat there will be more motivation for buyers. The whole time, the market maker ismaking money, RISK FREE, because of EQUAL NUMBERS OF BUYERS AND SELLERS. Inshort, prices are where they are because SECURITIES ARE NOT WORTH WHAT THEY AREWORTH, RATHER THEY ARE WORTH WHAT THE MARKET (those who are doing thebuying and selling) THINKS THAT THEY ARE WORTH. This is all simply the effect of thesimple rule of SUPPLY AND DEMAND.The bookmaker is the same species as the market maker; he simply lives in a different jungle. Pointspreads, odds and totals are the same thing as the prices of a stock or anyother security. THEY ARE ESTABLISHED INITIALLY BY THE BOOKMAKERS AND THEN AREDYNAMICALLY ADJUSTED RELATIVE TO SUPPLY AND DEMAND IN ORDER TO ENSUREEQUAL ACTION ON BOTH SIDES OF THE WAGER WHICH RESULTS IN RISK FREE PROFITFOR THE BOOKMAKER. In this case, the risk free income is the vig, t he amount thebookmaker takes in with no risk related to which side wins, this is the same thing as thebid/ask differential that the market maker takes in with no risk related to whether thestock or other security goes up or down in price. In a money line bet, the risk freeprofit is determined by the spread between the odds that the player must lay on thefavorite and the odds that the player can take on the underdog. For example if TeamA is playing Team B, and Team A is a 160/130 favorite, lets look at the two scenariosthat the bookmaker could see if we assume equal action. 100 people choose Team Afor $100 each. In order to win the $100 they must bet $160, so he takes in $16,000.100 people also choose Team B. To win $130 they must bet $100, so he takes in

another $10,000, for a total of $26,000 credit. If Team A wins he pays out $26,000.$16,000 that was wagered plus the $10,000 that was won for a net balance of zero. Butif Team B wins, he pays out $23,000. $10,000 which was wagered plus the $13,000which was won, for a net profit of $3,000. The point here is that the bookmaker cannotlose, and over the course of these bets being made, the winner is irrelevant because hehas no directional risk as long as the price is competitive enough to maintain equalvolume on both sides of the play. In this scenario, fair value or mid market wouldbe Team A is -145. Does that sound familiar?


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The more important mode of no risk market making (aka bookmaking), is thepointspread. I say that this is more important because it is the most common form of odds used to create equal action on both sides of a play in NFL, College Football, NBAand College Basketball action. In addition, the point spread method is the type of play

that is addressed by our flagship pricing algorithm, THE WOLFLINE . The details of thatproduct can be seen below. In the point spread mode of pricing, a relative strengthodds relationship is established by the oddsmaker/bookmaker/marketmaker tofacilitate equal wagering on both sides at -110 odds. So if for example, Pittsburgh is a 7point favorite over Cleveland and $10,000 is bet on Pittsburgh and $10,000 is bet onCleveland, the book will make 5% of what is wagered with no risk ($1000%$20,000). If an inordinate amount of money was placed on Pittsburgh, the spread would rise toentice the Cleveland buyers, if an inordinate amount of money was placed onCleveland, the spread would decrease to entice the Pittsburgh buyers (this sametheory applies to GAME TOTAL OR OVER/UNDER WAGERING MARKETS). AT THISPOINT THE POINT MUST BE MADE ABUNDANTLY CLEAR THAT THERE IS NODISTINCTION. ODDSMAKERS/BOOKMAKERS ARE THE SAME AS FINANCIAL MARKETMARKETMAKERS!!!!

This example can also be applied to the concept of arbitrage and bookmaker pricedisparity (usually based on regional factors).

The definition of an arbitrage is the simultaneous purchase and sale of an instrument indifferent markets to take advantage of a price disparity, usually done with minimal risk. A good example of this would be if crude oil was offered (or able to be bought) at $65 inLondon, and was bid (or able to be sold) at $66 in New York. An arbitrageur would wantto sell as many contracts as possible at $66 in New York and buy as many contracts aspossible at $65 in London (done in equal amounts of course). If crude oil went to $100,the arbitrageur would make $1 as many times as he executed the one to one arbitrage(less transaction costs). The purchase would make $35 and the sale would lose $34. Onthe other side, if the price of crude oil went to $30, the arbitrageur would also make $1as many times as he executed the arbitrage (less transaction costs). The sale wouldmake $36 and the purchase would lose $35. In a third scenario, what if the price wentout at $65.50? Its simple; the arbitrageur would make $1 again. $.50 on the buy at $65and $.50 on the sale at $66 (less transaction costs).

So in returning to our Pittsburgh vs. Cleveland example, we can once again see thesimilarities between the sportsbooks and the financial markets. I would imagine thatmost people who wager on sporting events would never see themselves as anarbitrageur. However, it is really quite simple to explain how that can be the case. If the oddsmakers or iginal line (in his infinite fundamental wisdom which we haveestablished is far superior to that of the player because there would be so much for himto lose in the event of a mispricing) is Pittsburgh -7, and that would be considered fair value , if we take into account the very undesirable aspect of emotion that many players


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are affected by, it would not be unreasonable to see the line move to Pittsburgh -8 in asportsbook where all of the players are from Pittsburgh, and for the line to move toPittsburgh -6 in a sportsbook where all of the players are from Cleveland. It is a fact of the sheep mentality of the crowd that SAC will protect its clients from. Knowing thatthe book wants to limit their directional risk the wagering activity would demand th at

these markets are adjusted in this way. So then how does the player become thearbitrageur? If he wagers $100 on Pittsburgh in the book where it is Pittsburgh -6 andhe wagers $100 on Cleveland in the book where it is Pittsburgh -8, he has become a oneto one arbitrageur. In essence he is BUYING Cleveland cheap and SELLING Pittsburghexpensive, hoping for a middle of 7, which is where the oddsmaker placed fair value inthe first place. If Pittsburgh wins by 14, the player washes because he wins thePittsburgh bet and loses the Cleveland bet. If Pittsburgh wins by 3, the player alsowashes because he wins the Cleveland bet and loses the Pittsburgh bet. Both of thesescenarios would result in a loss of $10 (5% of total wager), which interestingly enough isbasically the same thing as a transaction cost. However, in the event that Pittsburghwins by 8, the player will win $100 from the Pittsburgh -6 play, and PUSH on theCleveland +8. If Pittsburgh wins by 6, the player will win $100 from the Cleveland +8 playand get a PUSH on the Pittsburgh -6 play. If Pittsburgh wins by 7, the player will win$200, as both Cleveland +8 and Pittsburgh -6 will be successful plays. This is anarbitrage, and yet another example of the fact that sportsbooks are financial markets.In the following text, that fact will be of paramount importance when describing theproducts that SAC has to offer, most notably THE WOLFLINE . Obviously this examplecan be applied to over/under or total points wagers as well

RELATIVE STRENGTH RELATIONSHIPS

Now that it is understood that sports wagering markets and financial markets operate inthe same way, we should address the importance of the relative strength relationship.A relative strength relationship is the basis for how an oddsmaker determines thespread or game total for any particular event, MORE SPECIFICALLY, THE PERCIEVEDRELATIVE STRENGTH RELATIONSHIP.As a player in the world of sports gaming, one isthe same as a speculative retail customer in the world of the fin ancial markets.REMEMBER, THERE ARE MILLIONS AND MILLIONS OF DOLLARS RIDING ON EVERY GAMETHAT ENSURE THAT THOSE WHO SET THE ODDS DO NOT MAKE A MISTAKE. THE PLAYER

WILL NEVER HAVE THE ACCESS TO THE FUNDAMENTAL INFORMATION THAT THEODDSMAKERS HAVE. Because of this, we created TECHNICAL ALGORITHMS thatdisregard both the players emotional tendencies as well as their inadequate perceptionof fundamental factors of the contest (more on that below). The best way to describe itis by comparing any event that has odds/pointspread or game totals assigned to it, tointernational currency markets. For example, if THERE IS A PERCEPTION that theEuropean economy is stronger that the United States economy, then the value of theeuro will rise, and the value of the US $ will fall (and vice versa). In addition, one must


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always remember that MARKETS TAKE CARE OF THEMSELVES. There must be an equalamount of buyers and sellers at one particular price (spread) or a trade (wager) willnot take place.We now begin to get into the mechanics of how a speculator/trader (player) can useproven market psychology and the power of dialectic philosophy (the theory attributed

to some of the greatest thinkers of the western and eastern world that quantitativevalue is often misestimated with respect to qualitative value and gradual changes leadto turning points or reversals where one force overcomes the other) to increase theconfidence interval of a successful trade (wager), without doing any research andwithout being enslaved to their own emotions. The way to do this is by using theanalytic tools created by the traders at SAC. Tools that can scan every game on everyboard and determine when price action is showing that public perception is leading to areversal of trend, an overbought/oversold condition and a great potential of meanreversion. IN SHORT WE ARE ISOLATING TEAMS/TOTAL THAT ARE OVERVALUED BYPUBLIC PERCEPTION AND WE ARE SELLING THEM, AND WE ARE ISOLATINGTEAMS/TOTAL THAT UNDERVALUED BY PUBLIC PERCEPTION AND WE ARE BUYINGTHEM. THIS IS QUANTIFIED BYTHE WOLFLINE

FUNDAMENTAL AND TECHNICAL ANALYSIS

In the financial trading world, there are two major kinds of analysis that professionalsuse, they are fundamental analysis and technical analysis. Fundamental is the study of true economic factors and the effect that these factors will have on the value or price of a particular financial instrument (examples of this are interest rates, projected marketshare of a company, oil prices, quarterly earnings reports and guidance, projectedexpenses, etc SEE APPENDIX A.). This type of analysis can easily be projected into themarketplace of sports wagering to include individual player matchups, strength of schedule, defensive ranks, offensive ranks, home field or home court advantage,injuries, weather, etc. ( SEE APPENDIX B) Technical Analysis is the mode of analysis thattraders use to predict future market activity based on past price and volume data. Thetrader that uses technical analysis uses various charts and algorithms to determine themost likely scenarios for trend reversal or continuation using price correlations, pricecycles, trading activity of the crowd, and most importantly PATTERN RECOGNITIONTOOLS. Financial institutions and trading houses including major mutual funds andhedge funds all have both a fundamental analysis department and a technical analysis

department. SAC is the first and only company in existence that offers our proprietaryand patent pending method of technical analysis in the marketplace of sports gaming.Technical analysis is a time tested scientific method that can QUANTIFY THEQUALITATIVE DATA AND GIVE KNOWLEDGABLE TRADERS AND SPECULATORS SIGNALSFOR PROFIT INDUCING SHORT TERM TREND REVERSALS. IN THE ODDS DRIVENPSYCHOLOGICAL MARKET OF SPORTS GAMING, THIS TECHNOLOGY ISGROUNDBREAKING AND WILL GIVE THE PLAYER THE TOOLS THAT HE NEEDS TORECOGNIZE WHICH CONTEST TO PARTICIPATE IN AND ON WHICH SIDE, TO GIVE


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HIMSELF A HIGHER INTERVAL OF CONFIDENCE THAN ANY TECHNOLOGY THAT HAS EVEREXISTED.

YOU ARENT SERIOUSLY STILL USING A HANDICAPPING SERVICE ARE YOU?

As we covered above, fundamental analysis takes organic factors of financialinstruments/sports gaming selections and uses those factors to establish a value. In theworld of finance, fundamental analysis is used primarily for long term time horizoninvesting and has very little value in short term trading or speculating. In the world of sports gaming fundamental analysis is in essence completely worthless. Technicalanalysis can, when applied to sports gaming, provide the player with a signal to whenthe psychological perception of the general public is either far too optimistic or far toopessimistic. Because of the trading concepts of overbought/oversold, relative strengthindex and expected mean reversion, SAC has developed the technology to quantifythese points of inflection, scan every game on the board for the client, and deliver thecustomized value to the client via email, rss feed, or sms to a mobile or hand helddevice.

We have already covered the fact that with millions and millions of dollars riding oneach event, the oddsmakers cannot afford to make a mistake. That is one of thereasons why the uninformed are incredulous to the fact that the spread seems toalways be right on the money. That is only partly true, although they are very closemost of the time, but remember, the spread is adjusted just like the price of a stockbased on the supply and demand of bids and offers, so just like in financial markets,EACH TEAM IS ONLY WORTH WHAT THE PUBLIC WILL PAY FOR IT, REPRESENTED BY THESPREAD IN A RELATIVE STRENGTH RELATIONSHIP. With that being said, as a player onemust concede right now that one will never have access to all of the fundamental datathat the oddsmakers have. They are not in the business of making mistakes and if aspread opens up at a strange price well then there most likely is a very good reason.Because of this, as a player, one must forget about fundamental analysis, because as issaid in the marketsit has all been priced in. Do those that wager on sporting eventsreally think that they know something that the oddsmakers dont? Often you hear thecomments in the sportsbook from players handicapping the game and talking of oneteams superior defense or another teams inability to stop the run.These individuals are referred to as odd -lotters in the financial markets. That term

refers to the general public and is basically a euphemism for a sheep. It comes fromthe fact that when someone puts in an order (either buy or sell) that is not in a round lot(100 shares), it means that they are not well informed and hence are late to a trendwhich is a reversal signal. If you look at markets, let us use the stock market for anexample here, if trends continue on low volume (either up or down), it is often a signalfor a reversal because there is an absence of large, institutional block orders whichusually represents smart money, hence there would be dissipating volume. (Of coursesome studies have appeared in recent times that proclaim that the ignorance of the


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odd -lotter does not exist significantly enough to warrant using their activity as anindicator of a trend reversal so it should not be given credence when trading a stock.However, it can certainly be argued that these claims are made to dissuade individualsfrom trading individual stocks so that they can be sucked into the mega-vacuum of themutual fund where they lack any personal control and pay their annual fee whether

they make money or lose over half, like occurred in 2008, but that is another issue thatis addressed on our other websites)This brings me to my next point. If we have established that the scope of fundamentalanalysis possessed by the oddsmaker/marketmaker/bookmaker is greater than theplayers scope can be, than why on earth would someone pay a handicapping service(even if we assume that their intentions are sincere)? A tout/tipster/handicapper knowsno more fundamental data than the average player and yet, uncertain and ill-informedplayers shell out thousands of dollars or large percentages of their handle to theseservices. In addition, most of these services operate with that old stock brokerscheme where they tell 50 people to play Team A and 50 people to play Team B. WhenTeam A wins they call those 50 people back and tell 25 to play Team C and 25 to playTeam D. When Team C wins they call those 25 back and say so I gave you two winnersnow pay me big for the next one and so on, and so onSo m y question remains, YOUARENT SERIOUSLY STILL USING A HANDICAPPING SERVICE ARE YOU?

BULLS AND BEARS, WOLVES AND SHEEP

Everyone knows the terms bullish and bearish when it is used in the realm of financial terminology. Bullish means that the exp ectation is for an increase in thevalue of the instrument and bearish means that the expectation is for a decrease inthe value of the instrument. These terms can apply to anything and for our purposes, itis important to note that these terms can be applied to different sides of a sports event,which as we pointed out earlier is a relative strength relationship, just like the currencymarket. If you are bullish the US Dollar vs. the Euro, you are buying (getting long) theDollar while simultaneously selling (getting short) the Euro, but only in regard to howtheir strength reacts RELATIVE TO THE OTHER. The same can be said with sportingevents. If we still use our previous example if one feels that Pittsburgh is undervaluedand Cleveland is overvalued, then the play would be to buy(get long) Pittsburgh,which would automatically make you sell (get short) Cleveland, and vice versa.In this example, the player would be bullish on Pittsburgh and bearish on

Cleveland.

In addition to bulls and bears, financial and sports wagering markets also have WOLVESAND SHEEP. As Im sure it is apparent by now, the wolves are themarketmaker/oddsmaker/bookmaker and the sheep are the retail customer/oddlotter/public bettor that relies on deficient fundamental data, emotion, andhandicapping services. Of course everyone is aware of the old platitude that says tocatch the wolf, you have to think like the wolf, because if you think like the sheep, it will


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be your end. That is true in financial markets and it is true in the sportsbook (and weknow by now that they are the same thing.) In order to allow the player to think like thewolf, and defeat his obstacles to catch the wolf, we here at SAC have called upon all of our experience in trading, market making, and technical pattern recognitiondevelopment to create THE WOLFLINE

MEAN REVERSION, OVERBOUGHT/OVERSOLD, AND THE PENDULUM AND THE DOG

To understand the hallmark concept of this entire service that includes THE WOLFLINE ,after one is familiar with the paramount fact that sportsbooks are financial tradingfloors, the only step that is left is to simply understand expected mean reversion andrelative overbought/oversold conditions. It is merely logical to accept this truth and seehow these two concepts relate to the quantitative mispricing that results from theimproper perception of qualitative value which is predicated by the psychology of thecrowd (behavioral economics). Consider the unruly dog who is on a four foot leash, atany one time the dog could move four feet to the right or to the left but the ownerwould obviously not let him stray further than that because those are the confines of the leash. When the dog reaches that threshold, in either direction, its next naturalcourse of action is to return to the opposite direction. The dog will return to the centerline until it reaches the four foot threshold in the other direction, at which time theprocess will start all over again. This process is much like the swinging of the pendulum,where there is constant vacillation in a range, and when something tests the outer limitsof its range, the ensuing activity will be a reversion to the mean (the center) and thensubsequent testing of the opposite limit. This range determined price movement is ongoing in stocks, currencies, metals, commodities and yes, IN SPORTING CONTESTS.Market Psychology is everpresent in the sportsbook and it leads to short term mispricingin matchups where one side is significantly overbought (overvalued) and the other sideis significantly oversold (undervalued). THE WOLFLINE scans the entire docket of pointspread priced head to head matchups and over/under (total points) matchups andquantifies each. When the proprietary algorithm finds an event/scenario where thenu mber is sufficiently high to warrant a mispricing, based on the users customizedparameters, an alert will be processed and the client will be notified. The client willthen take that information into consideration as a tool in his arsenal to help makeselections that increase the confidence interval of the play.

The odds makers know when the public will have an overvalued view or an undervaluedview of any particular team (wagering choice) and he will adjust the spread accordingly,the more overvalued a team is based on the perception of the public the greater thechance for mean reversion which means that the team should be sold at that priceand vice versa. Financial instruments move in trading ranges. At the point of trendreversal, quantitative value is not properly priced with the qualitative value. We have


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created a pattern recognition tool that finds those opportunities and alerts the client tothem.

This is no system or magic equation. It is simple financially based proprietary pattern recognition tools that have been successful in other markets and are now being applied

to the sports gaming market. The best part of THE WOLFLINE and other upcomingproducts from SAC, is that the client does not need to do the countless hours of technical and/or fundamental research that it would take AN EXPERIENCED FINANCIALANALYST to procure this valuable data. One must only understand the rough concept of what has been outlined here, the ability to receive THE WOLFLINE number, and a desireto stop being the sheep and to BECOME THE WOLF!!

Have you ever made an over/under or total wager in ANY sporting contest? If theanswer is yes than guess what??? YOU ARE AN OPTIONS TRADER .

The founders and staff at Sports Action Charts (or Sports Action Analytics) are allformer on floor /off floor options traders, authors and instructors in the US and Europe.We also are developers of stock and option analytic software that screens entiremarkets to isolate and notify traders of technical mispricings tha t increase the tradersconfidence interval that a profitable trade can be made at a specific time. In the worldof financial markets, the individual at the top of the sophistication pyramid is theoptions trader. The options trader must have the greatest scope of knowledge and skillin order to profit from the edge that he creates for himself, not only in the underlyingmarket, but in the options market based on that underlying market as well. Only a verysmall percentage of financial professionals ev er use options, and even a much smalleramount use options correctly. The reason for this is, very simply, because of fear,ignorance and a lack of education. The reality of it is most people that can understandthe simplicity of informed, responsible speculation on sports wagers, can understandthe complexities of options trading, which really is not that complex at all. Conversely,someone who understands option trading in the context of financial markets will besurprised to realize that they can cons truct positions in sports wagering just like theydo with financial products, only the sports wagering market is open long after thefinancial markets are closed (weekends and holidays too).

There are two main ways that an options trader can profit. These are a changein price and a change in volatility, both of which must occur in a certain context of time.Profiting from a change in price would be similar to wagering on a particular team orindividual in a contest. Profiting from a change in volatility would be similar to wageringon a game/contest total or over/under. Here at SAC, we follow a simple rule with allof our products. WE BUY LOW AND SELL HIGH. THAT IS ALL WE NEED TO KNOW. Thiscan be done by selling overpriced issues, buying underpriced issues, selling overvaluedvolatility, or buying undervalued volatility. When we speak about volatility, it very


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simply means how much activity happens during a predetermined period of time (i.e.HOW MANYTOTALPOINTS ARE SCORED IN A GAME)When an options trader sells volatility or sells premium, he is making an educatedspeculation or wager that there will be less activity during the determined amount of time (length of the game, half, fight, etc) than the market is pricing. That volatility price

is often referred to as the total or the over/under which is determined by theoddsmaker and moves according to supply and demand just like options markets. If theoptions trader buys volatility or buys premium, he is making an educatedspec ulation or wager that there will be more activity during the determined amount of time (length of the game, half, fight, etc.) than the market is pricing. The kind of volatility that the market is assuming before the contest (the total or over undernumber) is known in the options markets as implied volatility. That is self explanatorybecause it is the quantification of the activity that the market is implying. Much of thatnumber is based on historical volatility (which is determined by the level of activity thatboth sides of the forthcoming contest have exhibited in the past). Many times, ourproducts can distinguish when the implied volatility of a contest (the total or over/underprice) is either overvalued or undervalued. In these cases, there will be a quantifiablesignal to play the under when implied volatility is overvalued and a signal to play theover when implied volatility is undervalued. At this point, as a client of SAC, you knowmore about trading options than about 95% of the financial professionals that you willever meet in your life, and I dont care how expensive their watches are.Congratulations!

Furthermore

The world of options trading can get a bit confusing, and to truly be aprofessional, there are many concepts that need to be known frontward and backward,and many of these concepts are represented by letters in the Greek alphabet. In thecase of our example here, the one letter that is relevant is Gamma. We need go nofurther here than to understand that a spec ulation or wager or position that profitsoff the passage of time with little activity or scoring (i.e. the under) is a shortGamma position. Conversely, a speculation or wager or position that profits off of agreat deal of activity or scoring (i .e. the over) is a long Gamma position. It is acommon analogy in the options trading world that losing money in a long Gammaposition is like dying of cancer, while losing money in a short Gamma position is likedying of a heart attack. Does that sound familiar? It is much the same scenario as in a

losing wager or speculation of the over being the death that is a slow decay with littleactivity while a losing wager or speculation of the under is quicker and brought uponby sudden and frequent activity. These wagers of course go both ways as in theexample of the under where the play becomes much more of a probable winner asthe time ticks by and vice/versa. (Note: Readers with a decent working knowledge of option theory will ascertain here t hat the Greek letter Theta represents the value thataccumulates due to the passing of time. If you are short Gamma, you are collectingTheta as the product decays over time. If you are long Gamma, you are short


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Theta thereby paying out Theta as the product decays over time. This part of optiontheory along with an entire curriculum and analytical tools are offered by firms affiliatedwith SAC).

There is a running theme here. All of the software screening products that thefounders of SAC have developed over the years to detect and isolate favorable

mispriced scenarios in the financial markets that have been so valuable to traders, fundmanagers and position managers have been translated perfectly into products that willalert our customers to mispricings. These could be teams/individuals that areaggressively overpriced, underpriced, overvalued volatility or undervalued volatility.And the best part is that these mispricings are represented as one simple number. It isup to the client, and their personal risk tolerance, to decide how drastic the perceivedmispricing must be before they wager/speculate/make a trade. It is up to YOU.

Mean Reversion Revisited

With this concept of buying volatility when it is undervalued (betting the over)and selling volatility when it is overvalued (betting the under), it is now logical to seethat the main concept to be aware of when you are trading any market, whether it issports gaming or stocks or currencies, etc. is the idea of mean reversion (the pendulumand the dog). The phenomenon for values to become over extended by the marketsand subsequently trade in channels is as apparent in volatility as it is in price and that isrepresented by the unruly dog on the four foot leash that was discussed earlier. Whenthe dog reaches the end of the leash moving in one direction, it MUST reverse courseand move in the other direction to ensure that a forward path is maintained. Thefurther that the dog (price or volatility quantity) moves away from the centerline, thegreater the probability for a reversal in course. THIS IS THE REASON WHY ALL OF THEPRODUCTS OFFERED AT SAC ARE REPRESENTED BY A NUMBER ON A SCALE, AND IT IS UPTO THE CLIENT TO DETERMINE WHAT THEY PERCIEVE TO BE AN OVERVALUED PRODUCT(TEAM OR TOTAL) TO SELL OR AN UNDERVALUED PRODUCT (TEAM OR TOTAL) TO BUY.

Getting Short and Getting Long

It is common terminology in the financial trading world (and now we know allthat happens in the trading world can be transposed to the sports gambling world) touse the terms getting short or getting long to describe the speculative position thatone holds. Remember, participants in a market that are not the market maker

(oddsmaker) and are taking a directional position (either in price or volatility) arespeculators, because they are speculating on future direction. This is unlike the marketmaker or odds maker who make money off of the spread in the market(vig/juice/commission) multiplied by how much volume there is (amount of wagers),with n o directional implications. It is very simple really. If a trader (bettor) gets long aproduct, they are essentially purchasing the product and assuming that its value will goup, or it will outperform the value it was assigned at the time of purchase in the future(for our purposes that would mean the next game or contest). If a trader (bettor) gets


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short a product, they are essentially selling the product and assuming that its value willgo down, or it will underperform the value it was assigned at the time of sale in thefuture (once again for our purposes that would mean the next game or contest). WHENA TRADER (BETTOR) IS BUYING A PRODUCT (TEAM) AND EXPECTING PRICE VALUE TOINCREASE (VICTORY), HE IS SAID TO BE LONG DELTAS. WHEN A TRADER (BETTOR) IS

SELLING A PRODUCT (TEAM) AND EXPECTING VALUE TO DECREASE (LOSS), HE IS SAIDTO BE SHORT DELTAS. The software and screening tools that have been developed atSAC, scan the entire universe of games in whichever sport the customer chooses topurchase, and then sends an alert as to favorable technical scenarios that present amispricing. At this point the customer would determine if the mispricing is significantenough to get short the overvalued product and get long the undervaluedproduct.

Of course anything can be bought or purchased as long as there is another sideof the trade (wager) willing to execute at the determined price (that was coveredearlier). Everything is a marketplace and everything goes through cycles of beingovervalued at times and undervalued at times. This constant law applies to all goods,services, materials, countries and even people. For our purposes we concentrate on thislaw applying to sports teams (or individual participants). Financial markets that haveproducts to get long or get short can be stocks, bonds, commodities, preciousmetals, etc. But for our purposes, the most relevant market of comparison is THEFOREIGN EXCHANGE MARKET. The reason for this is that foreign exchange markets(forex/currency) are RELATIVE STRENGTH MARKETS that are priced according to onecurrencys strength RELATIVE TO ANOTHER. For example, if a trader is speculating thatthe US Dollar will outperform the Euro for a certain period of time, that trader will getlong THE USD/EUR. By definition, the trader would be getting short the EUO/USD ATTHE SAME TIME. THIS IS EXACTLY HOW THE SPORTS WAGERING MARKETS WORK.(Important note: The reader does not need to understand the following section oncongruent position construction to effectively use our analytical products. One onlyneeds to understand the buy low and sell high model. All of our products areextremely user friendly so that actual financial market experience by the user is not atall necessary. However, in maintaining the macro-theme of this publication thatprovides information that illustrates the similarities in these markets, it is necessary toconvey the correlation between stock/option position construction and varying sportsgaming wagers, most notably the characteristics of presumed risk/reward based uponspecific outcomes and the connection between stock price and odds/spread, as well asthe connection between implied volatility and over/under or total amounts.) So in the

interest of our products, if Chicago was playing New York, and Chicago was a 7 pointfavorite with a total of 46 points, and the bettor (trader) was making an educated andinformed speculation that Chicago would win by more than 7 points and the totalpoints for the game would go under 46. The bettor (trader) would purchase Chicagoand sell volatility. He would belong Chicago and short volatility . By virtue of this, he would automatically be shortNew York and short volatility . For anyone who has a fairly decent knowledge of options/stock trading, the wager would be similar to a buy-write . It would be a position


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that is long Chicago stock and short an out of the money Chicago call (a syntheticChicago short put). This position would be long delta on Chicago (or short delta on NewYork) and short Gamma on the game. This position or two wagers would profit fromprice direction by Chicago winning by more than 7 points and would profit by volatilitydirection by the activity being infrequent enough to stay under 46 points.

Position Construction

Without going into great detail (firms affiliated with SAC cover all optionseducation and services), here are some examples of positions constructed as wagerswhile staying with the Chicago - 7 vs. New York with a total of 4 6.

Chicago -7 Buy Chicago stock or sell New York stock(Long Chicago deltas, short New York deltas)

Chicago and under 46 Buy Chicago stock, sell a Chicago out of the money call(Long Chicago deltas, short gamma, long theta)

Under 46 only Sell a straddle on the game (Short gamma, long theta, delta neutral)

Chicago and over Buy a Chicago call(Long Chicago deltas, long gamma, short theta)

Over 46 only Buy a straddle on the game (Long gamma, short theta, delta neutral)

New York +7 Buy New York stock or sell Chicago stock

(Long New York deltas, short Chicago deltas)

New York and under 46 Buy New York stock, sell a New York out of the money call(Long New York deltas, short gamma, long theta)

New York and over Buy a New York call


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(Long New York deltas, long gamma, short theta)

These are congruent examples between stock/options markets and a fictionalsports wagering game scenario. The purpose is to reinforce the idea that SPORTS

GAMBLING MARKETS MIMIC ALL FINANCIAL MARKETS AND ARE SUBJECT TO THE SAMETRADING RULES AND METHODS. THIS FURTHER DEMONSTRATES THAT THE PRODUCTSAT SAC TRANSLATE PERFECTLY INTO THE SPORTS GAMBLING MARKET.

We can easily translate a common trading method and position construction intoanother very reasonable hypothetical wager on this game to further reinforce theanalogy between the financial market trader and the sports gaming player which is of paramount importance when realizing the value of the technical analysis products atsportsactioncharts. The common position/strategy that we will refer to is a hedgestrategy known as the protective put or sometimes the married put. Basically, thisstrategy allows a trader or speculator to purchase a stock because he presumes that theprice of that stock is currently undervalued and that most likely the price will rise in theshort term (it is probable that the traders proficiency in technical analysis contributedto this opinion) . However, the trader also feels that he would like to be protected inan event that he is catastrophically wrong for some reason (it happens to everyone atsome point) , and the stock price tanks dramatically. He can protect himself or hedgehimself by purchasing a downside protective put. Without going into depth of detailthat is beyond the scope of this publication, an example would be if he bought the stockat 50, and he bought a 45 put, he would be protected from 45 all the way to zero. So intheory, when this trade is executed as a one to one trade, the most he could ever losewould be $5 (the amount between where he bought the stock and where the put kickedin) + the minimal extrinsic value of the put. Of course he would rather that the stockincreases in price value, at which point he would be happy to pay for the value of theput (which would now be worthless) out of his winnings. Sometimes the peace of mind that comes with insurance is well worth it. The most undesirable scenario in thisparticular trade would be for the stock to end the expiration cycle between $45 and$50, with $45.01 being the worst outcome. This is because the trader would lose dollarfor dollar on the price of the stock that he is long going down+ he would lose whatever $he paid for his insurance put that never came into play. Once again, there areancillary factors that would go into an options trade such as th is that are beyond thescope of our services, but sportsactioncharts has trading education and strategy services

as affiliates that address these topics in their entirety.Now let us create the corresponding sports player/trader/speculator scenariowhile using the price data that is shown above. The sports gaming player in ourexample views New York as an appropriate wager to win the game outright (perhaps byvirtue of using one of our technical analysis products), because of this he sees New Yorkas undervalued and he would go to the moneyline market to play New York to winoutright. The usual moneyline odds for this scenario would be approximately New York+$280, which correlates to $280 in profits for every $100 he wagers. At this point he is


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purcha sing New York (outright win) stock. The other half of the trade is to purchasedownside put protection or some kind of hedge to minimize his losses and protecthim if he is catastrophically wrong (it happens). It is fairly simple to see the appropriateand congruent play to make here. The player would bet one to one (in this case $100)on Chicago - 7 points. This would be similar to buying a protective put on New York.

At the point where Chicagos value (relative score to New York) exceeds 7 p oints andstays there until the end of the expiration cycle (the end of the game), the player wouldbe protected. In this scenario, the $100 dollars that he would win on Chicago -7 wouldoffset the $100 that he lost on the New York moneyline wager. So as long as Chicagowon by more than 7 points, he would be hedged. Many times, gaming players believethat a fairly heavy underdog can either 1) win the game outright; or 2) get blown out.The strategy one would employ here would be such as the one that was just discussed.The most favorable outcome would be a New York win (purchased stock price rising),but a convincing Chicago win by over 7 points would ensure a net loss of zero (stockclosing below the 45 put strike price at expiration). The result that would be the mostunfavorable in the game would be Chicago winning by a margin between 1 and 7 points.This would result in a loss of both wagers ( a tie in the hedge if Chicago wins by 7 whichwould still result in a net loss), very similar to the undesirable outcome of the stock inthis example ending the expiration cycle at a price between $45 and $50. This is a finereal world type hypothetical scenario of how position or trade construction in thesports wagering markets mirrors the trading in the financial markets, once again leadingus to the importance of technical analysis .

Oddsmakers know more than us

Yes it is true, as much as none of us want to admit it. Oddsmakers do knowmore than us, and its about time that we start to a ccept it. Now we have to determinewho us really is. Us is everyone but those who make the odds, and that SURELYINCLUDES TOUTS, TIPSTERS, HANDICAPPERS AND CONSULTANTS. As we addressedearlier, even if the intentions of these services are noble and not based on a scam, thereis no one that will have the resources to the relevant fundamental and situational datathat the oddsmakers have. The reason for this is simple. The casinos, off shore books

and any other gambling institutions that make spreads, odds, and over/unders onsporting events have millions and millions of dollars riding on EVERY possible wager. Inorder to ensure their avoidance of directional risk, THEY HAVE TO KNOW EVERYTHINGPOSSIBLE FUNDAMENTALLY ABOUT THE CONTEST. Moreover, if there is a largedisparity in demand on one side, the spread, odds, or over/under will be adjusted toensure their safety (as explained earlier). If we find ourselves rationalizing our wagersby comparing offenses vs. defenses, or lack of a running game leading to more clockstoppages, or the Jets being 8-2 ATS their last ten games coming off a bye, or how many


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runs should be scored because of the wind or the distance of the right field wall andhow many left handed hitters are playing, etc, etc, etc, then we have lost. We can neverout handicap the oddsmakers fundamentally . However, we can use proven technicalmethods that isolate mispricings that are caused by an uninformed public that distortsmarkets based on their weakness of human emotion. The main goal of the products of

SAC is to divorce ourselves from the emotion that hinders our power of objectiveanalysis, which allows the customer to make more accurate and successful decisionsand wagers. And the consistent end result becomes BUYING UNDERVALUED ANDSELLING OVERVALUED.

How the spread is made and what makes it move

The process by which spreads or odds are made has been covered and theconcise synopsis is that odds makers compile all fundamental and situational data thatthey have access to for that particular contest (which we have established is much morethan anyone else will ever have) and they set a relative strength relationship pricebetween the two betting interests (sides or totals) that will most likely result in anequity of wager volume on both sides. If there is an inequitable volume wagered oneither side, the spread/odds will be adjusted just like any other supply and demandmarket, so that the book (broker) will be more or less locked into his 5% of total volumewagered (in point spread wagers with a 10% vig) and something close to that inmoneyline wagers. We have also discussed the importance of smart money(institutional, block orders) vs. dumb money (retail, odd-lots). In the old days, localbookmakers would know who their sharp clients were. If one of these clients put in asubstantial play (or even a not so substantial play), they were able to move markets(spreads, odds) significantly. These days, with sports books becoming a global internetbusiness, there are still certain sharp clients that move markets, but for the most part,one single $100k wager has a greater potential of moving a market than 100 $1k wagerson the same product. It should also be noted here that in the case of American Football,it is extremely difficult to move a line from 2.5 to 3, 3 to 3.5, 6.5 to 7, 7 to 7.5, 9.5 to 10,

10 to 10.5, 13.5 to 14, and 14 to 14.5. When lines move in this fashion, there usuallyhas either been a significant block order, or a sharp client is involved. In addition, atthis point we should point out that the oddsmakers reluctance to move the number forthe over/under (game total) increases the further out the number goes from the medianaverage (either up or down). Basically from a statistical standpoint, we see a bilaterallogarithmic distribution (stocks are distributed in what is called a lognormal distributionwhich means prices are skewed to the upside because they cannot go below zero, butadequate content about distributions is beyond the scope of this publication). In


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laymans terms, this means that if the total points is set at 40, there is the samepercentage chance that 50 points will be scored as there is that 30 points will be scored(in theory, there is a slightly greater chance that 50 will be scored because thedistribution can go no lower than zero, but this is statistically insignificant. In reality thestructure of sports contests gives each contest an ambiguous top, so the skew to

upside potential is not the same as financial products where the upside is potentiallyinfinite. In the tech boom of the late 90s, Qualcomm Corp. went up over $100 in pricein one day. This theory correlates on a much weaker level to sporting events).However, when moving the line for the total, the oddsmaker will need much moreincentive (volume/wager amount) to move from 39 to 38, than he would to move from40 to 39, and so on until obviously in theory the most incentive would be needed to gofrom 1 to zero (although in reality a total would never go that low, regular season gamescould end in a zero-zero tie, but a playoff game would need a minimum total of 3.5).The same works on the other side. It takes much more incentive (volume/wageramount) for the oddsmaker to move the line for the total up as the price moves furtherabove the total set at 40. Much more incentive (volume/wager amount) would beneeded to go from 41 to 42 than from 40 to 41. The further away we go from theestablished mean in either direction, the more volume it takes to move the price. Inkeeping with the NFL for basis of reference, it should be noted that historical meantotals hover around 45 points, with an irrelevant amount of occurrences going below 30to the downside, and above 60 to the upside. In the modern era, historical data wouldplot the mean average (as well as the mode and median averages) in the area of the mid40s, as seen in the classic bell curve, the occurrences become less and less as we movetowards 0 and 90-95 (remember the slight lognormal skew). Other sports have differentstatistical mean averages, (college football has more of an upside skew for manyreasons, mostly because of the structure of overtime) but the concept is the same forall.

TrendsThey mean somethingBut its not what you think

Everybody hears them and everybody sees them. The guys that come on theradio and television and now of course they litter the internet, with their statistics ontrends that could possibly give the layman handicapper insight or some specialangle for betting any one particular team, total, fighter, whatever. You see them with

their attempt at flashy dress and jewelry to present a faade of success. They usuallyhave a bad toupee and speak very confidently as if they know something that you dont.Wellthey dont. I like these guys because they are amusing cartoons, and there willalways be a place for them just like the flashy dressing stock brokers that dont reallyknow anything about the mechanics of how tradable markets work, yet they alwaysse em to have a hot tip. There will always be a segment of society that is drawn tocharlatans and want to believe that they have inside info (even though if they really did,it would be illegal). Actually, my favorite trend guy growing up was one parti cular


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individual in the 1980s, who worked for one of the major networks. I will omit hisname, but he was quite a high profile handicapper for a number of years and mostpeople reading this article would remember him immediately if they heard his name.This guy would come up with the most bizarre and obscure trend angles and he wouldactually give them out as his formula for selection (something along the lines of, The

Jets are 13-2 in their last 15 games coming off a Monday night loss on turf as a roadunderdog, so Im going to go with them)Huh? I still love that stuff though , as a sourceof amusement of course and nothing else . No. The reality of these trends that peoplecling to is, the only thing that they do is DISTORT THE PRICE OF THE MARKET AWAYFROM WHERE IT SHOULD BE PRICED BECAUSE OF THE INFUSION OF RETAIL MONEYWAGERING ON THE TREND.

For example, we have established ad nauseum that the oddsmaker wants a priceto be set on each contest that will see enough equity of action on each side of thecontest that he will not have any directional risk (like the marketmaker). Well, if thereis a trend taking place, he is going to add that into his pricing and that will skew theprice from where it should be because he knows that the supply and demand will beaffected. After that, large retail (public) volume will most likely skew the price furtherbecause they are under the false spell of the trend. Look at it this way, if Northwestern is 0-16 their last 16 at Michigan, they will most likely be huge underdogsgame number 17 at Michigan. The trend watchers dont care that no one on eitherteam was even thought of by their daddys for probably the first 12 of those games, andthe fundamental and situational details are completely different. Maybe Michigan isstill a far superior team than Northwestern and they deserve to be favorites. Butinstead of them being fairly priced as a 5-1 favorite, you might see them as an 8-1favorite. They might still win but it would be because of several reasons, and nonewould have anything to do with the trend. In fact, in theory, this particular year,Northwestern might even be superior to Michigan fundamentally and situationally, butthe myth of the trend would still skew to a mispricing. My poin t here is, over the longhaul, the mispricing of 8 -1 over 5-1, or whatever it may be, adds up, and recognizingthis leads to being a more disciplined, educated and eventually more prolific trader(bettor). This is consistent with our entire macroconcept at SAC. We are buyingproducts that are cheaper than they should be and selling products that are moreexpensive than they should be. That is the hallmark of successful trading. Our servicesare not meant to be a magic trick, but they are cool headed mathematical systems thattake advantage of the emotion of the crowd and profit from it.

Some more to think about

It is of paramount importance to realize that when wagering on sporting events,the bettor is acting as a trader and not an investor. Traders rely on technical data toisolate short term opportunities where issues are mispriced (often referred to as swingtrading). Investors, on the other hand, use fundamental data to purchase (or short)


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issues that they have a long term time horizon for, usually years. Obviously, a bettorcannot buy the Pittsburgh Steelers -7 and hold them for ten years. So by definition, thebettor is a game by game short term trader that relies on a relative strength relationshipthat changes with each opponent and situation. This is why technical analysis is soimportant to the bettor, just as it is to the short term swing trader in all markets, but

most notably the foreign currency market. The 3 main technical factors that areinvolved in trading/wagering are price (spread/odds), volume (amount wagered), andmomentum (how quickly and by how much price moves). Volume is a hugeconsideration in any kind of market speculation as we have discussed throughout thispublication. Volume moves markets. It takes much more buying power to increase thevalue of a stock like Exxon/Mobil $1, with over 20 million shares traded per day then ittakes to move a stock like Millicom International Cellular, with less than 600 thousandshares traded per day, the same amount. In the same way, it takes much more bettingvolume to move the spread one point in one direction in The Super Bowl than it does tomove the line one point in an NCAA basketball game between Chattanooga and Tulsa,for example. However, do not be fooled by another myth that is promoted by those fasttalking radio and television hosts on those handicapping programs. I have heardcountless times when these types have told their loyal audiences that games that aremore obscure have a better chance of being overlooked by the casinos and oddsmakers,thus making them vulnerable to a FUNDAMENTAL mispricing. Not true. Sure there isntas much bet on Chattanooga vs. Tulsa as there is in The Super Bowl, but it is still in themillions of dollars, and they have the same amo unt of risk for any listed game. It isnt asif they view a lower tier NCAA hoops game with disregard and let some intern set theprice. Sorry, it doesnt work that way. Below is an article that I wrote in September,2007 that deals with this concept of market/price/spread/odds movement as itpertained to two similar stocks.

By Gregory WolfeLately, I see many things when I look at the US financial markets that somemay perceive as a tumultuous and unpredictably volatile environment.Much of what I see is a constant reminder of the importance of under-standing the mechanics of the market. Of course, anyone who employsderivatives and technical analysis would most likely consider themselves atrader rather than an investor. Further, those whom choose to considerthemselves traders realize that buying and holding stock positions for an

indeterminate amount of time should be reserved for graduation andbirthday gifts from wealthy grandfathers to their pending heirs; no oneelse, from a leverage standpoint alone.I am often reminded, however, that the same tired, banal, and uselessperspectives of future earnings predictions, market share, new drugpipeline approvals, etc. are still being spoken of by the same tired,


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outdated faces day after day on every financial program under the sun.However, if the trader watching these outdated faces has enoughpersonal savvy to understand derivatives and technicals (most likely muchbetter than these experts), then surely the individual can discount these

predictions realizing that all of these aspects have nearly always beenpriced into the stock already, and the movement of the price of the stockwill actually be predicated upon mechanics, and not bizarre quarterlyearnings prognostications.One of the most glaring examples of this scenario is the difference in theprice behavior of Merck (MRK) versus Pfizer (PFE) over the course of thelast three years. In late 2004, both of these pharmaceutical giants wouldhave correctly been considered companies in distress. Both companieswere rocked by the prospect of huge litigation issues, arising from the

cardiovascular risks associated with their block buster pain relief drugswhich were classified as Non Steroidal Anti Inflammatory Drugs (NSAIDS).The drugs in question were Vioxx and Celebrex, for Merck and Pfizerrespectively.At this point, both stocks observed the usual ex-facto downgrades and thesubsequent panic sell off to the point to when the dust settled each stockfound itself trading in the mid 20s. The talking heads were then dusted off and wheeled out and one by one I watched as they touted the allegedsuperior pipeline and favorable bottom line of Pfizer making it the drug

giant the choice of the bull plays between the two distressed companies.Several things bothered me at that time, as they still do to this day. Mostly,it was the ignorance of these experts as it applied to relative float, sharesoutstanding, average daily volume, and ease of movement between thetwo. Additionally, when the drugs were booming earlier in the decade, MRKtraded above 90 while PFE never even reached 50.There are some definitions to address here. First, the float is the number of shares that can be freely traded by the public in a particular stock. The floatdoes not include shares that are restricted. Restricted shares are shares of

stock given to insiders, usually as part of a compensation package, whichrequire SEC authorization to be traded. Shares outstanding is a term for allshares which can be traded, including restricted shares. Average dailyvolume is simply the average number of shares which change hands on adaily basis; ease of movement is a non-quantitative term which simplyrefers to how easily a stock moves.


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It is the RELATIVE ease of movement with which I was so interested in atthis point. One must look at individual financial instruments and theirexpected movement much like other principles of physics and nature areobserved. We know that force= (mass) x (acceleration). In this case the

mass would be the shares outstanding of each particular stock and theacceleration would be how far we could expect the stock to go. If weconsider that the buying interest (the force) would be constant betweentwo companies (as for example MRK and PFE), then the expected resultwould be a much greater positive move for the stock with fewer sharesoutstanding. In other words, how much more force (buying power) would ittake to move a 300 lb man the same distance as a 100 lb boy. Thatsbasically the concept that is at work in this example.At this point it would be of interest to disclose that the shares outstanding

for MRK as of this date are 2.2 billion with 13.4 million shares of averagedaily volume. PFE has 6.9 billion shares outstanding with 52.6 million sharesin average daily volume.In addition, as alluded to earlier, MRK had recently seen highs over 90 whilePFE struggled to reach 50. It is for these reasons that as of the time of thiswriting we see MRK trading at $50.72 while PFE is languishing at $23.93.This situation is a result of the mechanics of the market, and it had nothingto do with pipeline predictions, earnings prognostications, or market share.And we, as traders, should not be surprised that the banal, tired, old faces

that continue to haunt us on the financial networks have yet to address anerror that could have destroyed your life savings in less than three yearstime.Looking ahead to future trading opportunities, it would be wise to employwhat was discussed here. If the trader would like to be long a sector (orshort), it would be indicated to ascertain the mass of each issue in thatsector. This relates to float, average daily volume, shares outstanding, andrelative ease of movement. By using the principles of physics, one can havea greater confidence interval regarding expected magnitude of movement .

There is one final example, I would like to point out between sports gamingmarkets and financial markets, because making that connection is so crucial tounderstanding why the products and services at SAC like THE WOLFLINE are so valuableto the bettor. This example has to do with the similarity between the size of the bid/askspread on options on different stocks, and the size of the moneyline vig/juice/spread ontwo different NFL games. The more interest there is in a product, the tighter the bid/askspread can be made, simply because the marketmaker/oddsmaker can make his incomefrom the sheer volume of trades/wagers that are happening. However, if there is less


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interest in a product, it is simple to see that the marketmaker/oddsmaker will have towiden his spread in order to ensure a greater size advantage to make up for the lesservolume. That makes sense doesnt it? Consider this (some knowledge of stock optionswill help here, to learn more about option theory and trading, click on to our educationlinks), on one particular day, the Steelers were playing the Chiefs (remember we dont

care where the game is because that is fundamental data that is priced in) andPittsburgh was an 11 point favorite. Obviously, there would not be much interest in thisgame from a moneyline standpoint because few people would give the Chiefs a chanceto win the game outright (although they did). Because of this lack of interest thespread/vig/juice/commission would be inordinately high, as I described above.Pittsburgh was 600/450, which as we spoke earlier means that to win $100 onPittsburgh you must bet $600, and if you bet $100 on the Chiefs, you would win $450(assuming of course that you speculated correctly). That means that fair value wasPittsburgh -525 and there was $150 vig. That is 28.5% vig! Quite a stiff price. The sameday, the Colts were playing the Ravens and the Colts were a 2 point favorite. Becausethis was priced as being a very even matchup that the underdog ostensibly had asignificant chance of winning, Indianapolis was 125/105. Considering that fair value wasthen Indianapolis-115 with a $20 vig, we are looking at a vig/juice/commission of 17.3%. That is certainlymuch less both in dollar value and percentage. This is because the volume on the firstgame would most likely be much less because of the slim perceived statistical chance of an upset, even though the dog won in the first game and the favorite won in the secondgame, but that is irrelevant in the context of the point we are making.

Now we will correlate this example to the stock options market involving twostocks that we mentioned earlier, Exxon Mobil (XOM) and Millicom InternationalCellular (MICC). XOM with its over 20 million shares traded per day (high volume/highpublic interest/Colts vs. Ravens) and MICC with fewer than 600 thousand shares tradedper day (low volume/low public interest/Steelers vs. Chiefs). On the same day that weobserved the data from the two NFL contests, we also observed data from the optionsprices of the front month, at the money strike prices (this is where some options theoryterminology would be helpful). The front month, at the money strike prices arerepresented by the options that most of the time sees the most interest/activity/volumewhich is represented by something called open interest (consider open interest to be aquantification of how many blocks of $100 bets were made on Pittsburgh (against theChiefs) and on the Chiefs (against Pittsburgh). Both stocks were trading at close to thesame price with 25 days until expiration. XOM was $74.38 and MICC was $74.92. We

will obviously call the 75 strike, the at the money strike for both stocks. The r easonwhy MICC options will be priced higher is because of the much greater implied volatilityfor that stock as determined by the market, but that is another issue and is not relevantto our point here. Our point here is the disparity between the size of the bid/ask spreadfor a high volume (interest) product and a low volume (interest) product. With XOMstock trading at $74.38, the DEC 75 calls were $1.29 bid and $1.32 ask with 20,000 openinterest contracts. The DEC 75 puts were $1.90 bid and $1.93 ask with 8,000 openinterest contracts. That sets the vig/juice/commission for the XOM calls at three cents


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on fair value of $1.305 (mid market) or just under 2.3%, and the vig/juice/commissionfor the XOM puts at three cents on fair value of $1.915 or 1.56%. Conversely, with tinyMICC stock trading at $74.92, the DEC 75 calls were $2.80 bid and $3.10 ask with only544 open interest contracts. The DEC 75 puts were $2.80 bid and $3.30 ask with only131 open interest contracts. That sets the vig/juice/commission for the MICC calls at 30

cents (ten times the XOM vig) on fair value of $2.95 or just over 10% and thevig/juice/commission for the MICC puts at 50 cents (over 16 times the XOM vig) on fairvalue of $3.05 or 16.3%. DOES ALL OF THIS LOOK FAMILIAR??? Less interest in lessvolume (amount wagered) means wider spreads so that the marketmaker/oddsmakerstill makes his $$$. I cannot stress enough the importance of understanding how ALLSPORTS WAGERING MECHANICS, THEORY, STRUCTURE OF WAGER, PROBABILITIES,COMMISSION TO THE ODDSMAKERS, ETC., ETC., EXACTLY MIMICS ALL OTHERFINANCIAL MARKETS AND THE TRADING PROTOCOL THAT SHOULD BE APPLIED TOSUCH.

This publication has delved into many nooks and crevices of one very importantcentral concept. Some of the theory and examples that have been discussed couldseem very foreign to most readers. Some may find that it now all makes perfect sense.The goal has been to stress to sports gamblers and financial market underlyingissue/option traders alike, that you are the same fish swimming in different ponds. Thegoal of each is to divest yourselves from your own emotion, meaningless and jadingtrends, know nothing tipsters and boiler room type frauds, etc. The goal of eachis to embrace the concepts and tools of true market analysis. Embrace the reality that alltradable products move in channels, and to profit, the method is simple, you BUY LOWAND SELL HIGH. Once we understand that all of these concepts are universal, the smarttrader can wager intelligently on sports and the smart bettor can intelligently trade inthe markets, because they are the same thing. We at Sports Action Charts fullyunderstand this, and our decades of experience have allowed us to create products thatwill revolutionize the way people wager on sports. By using proprietary concepts thathave been market tested and proven, we will give the customer the tools andammunition necessary to make his own informed, logical decisions based onquantitative mispricings that we can isolate with our software systems.

Putting it all together

At this juncture, I believe that our point has been thoroughly made to thereader. Sports wagering is TRADING, IT IS NOT INVESTING! Because of this, thecomponents of Appendix B are irrelevant to us, just as the components of Appendix Aare irrelevant to the short term directional or volatility trader in financial markets. Theshort term swing trader relies on TECHNICAL ANALYSIS, and SACs patent pendingproducts are the only technical analysis tools of their kind available today. You cannotINVEST in a particular team in the sportsbook. You cannot, for example, make a wagerthat over the next ten years, The Pittsburgh Steelers will win OVER 100 GAMES. This


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would be an example of an INVESTMENT BASED UPON FUNDAMENTALS. What a bettordoes in a sportsbook is SHORT TERM SWING TRADING BASED ON THE CROWDSPERCEPTION OF RELATIVE STRENGTH AT THAT ONE PARTICULAR TIME OF THE CONTEST.So for our purposes, we leave the quantification of the data similar to what is found inAppendix B to the professionals, the guys that have millions riding on their ability to

make and keep a tight market. A very significant example of the average bettorsFUNDAMENTAL ANALYSIS failing and SACs TECHNICAL ANALYSIS succeedingoccurredon 12/25/09 in a matchup between The Tennessee Titians and The San Diego Chargers.The FUNDAMENTAL argument is described in Appendix E, while SACs TECHNICALANALYSIS of overbought/oversold mean reversion probability is shown in Appendix F.The staff at SAC care nothing about fundamentals and the tools that we have developeddo not take any of that into account. We dont care if a rule change forces allquarterbacks to play with their shoelaces tied together and the Big Green Monster isturned into a chain-link fence. We do not care if the NHL started playing gamed onfrozen rivers and tennis players were forced to start playing with wooden rackets again.WHY? Because we are traders not investors, just like you, and those who make themarkets will price those factors in so that they can match up buyers and sellers.

Now the majority of this publication has been dedicated to educating the readerabout two primary facts. 1) Sportsbooks operate on the exact principals as any otherfinancial market where trading based on price direction and volatility changes takesplace. 2) The sports gaming bettor is a short term trader, not an investor, and technicalanalysis tools like the ones offered by SAC are extremely valuable when trying todetermine a risk tolerance and a confidence interval for any type of sports wager.However, there is one very important difference that needs to be addressed that isshown graphically in appendix C and appendix D. While overbought/oversold indicatorshave been used by traders in the financial markets for years with great success based onthe everpresent principle of mean reversion, the markets are not a pure example of this theory because the price (or volatility) of where a financial instrument will go is notreset every day to where the proposition is 50/50 whether price (or volatility) will rise orfall. On the other hand, a sportsbook or sports wagering market is reset for eachcontest so that each contest is ensured, by the odds, total points over/under, ormoneyline (over time) to have an equal 50/50 probability of outcome so that thehouse has no directional exposure and can lock in profits based on volume of wagers.This is why our products (most notably THE WOLFLINE ) take that into consideration andwhy we have developed our proprietary mispricing method that makes the client anemotion free analytical trader. If the reader understands the concepts behind appendix

C and appendix D, then they will understand all of our products which scan all possiblesporting concepts and produce a number that allows the client to determine forthemselves how significant the overbought/oversold scenario is, and whether or not thepotential for mean reversion calls for a wager, and what size the wager should be. Aswe see in appendix C, the against the spread statistical probability for mean reversionis shown. As can be seen, the display of degree of divergence that accumulatesbetween the two components in question (teams or individuals that are to be matchedup) is positioned over a normal distribution bell curve. It is simple to see that as the


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level of divergence increases, based on historical against the spread performance, theprobability of that performance continuing in the same direction becomes less and lessas it moves out to the tails of the distribution. The greater the divergence becomes,the greater the potential for a reversal of trend and a return toward the center line of the distribution (mean). This is related to the random walk theory and is the premise

behind the popular game show called plinko. The over/under or total points graphicrepresented in Appendix D is the same premise, except the angle of diversion is 22.5degrees instead of 45 degrees because it is aggregate over of A and B or aggregateunder of A and B that would lead to the statistical probability of a return to the mean asopposed to the difference between A and B in the against the spread model . Thesetwo graphics, when taking into account that the oddsmakers k nowledge and incentiveplus the supply and demand of the market ensuring that each contest is a fresh 50/50proposition, explain the quantitative basis for the value of THE WOLFLINE and all othermean reversion products offered by SAC/SAA

SPORTS ACTION CHARTS/SPORTS ACTION ANALYTICS WILL ALWAYS BELIEVE INTHESE PRINCIPLES:

WE DO NOT CARE ABOUT FUNDAMENTALS WE BUY LOW AND WE SELL HIGH!!! THE PUBLIC IS NOTORIOUS FOR BEING LATE TO TREND REVERSALS!! TRENDS OF PUBLIC PERCEPTION WILL REVERSE AND SEEK OUT THE OTHER

EXTREME AT SOME POINT, THIS ISCALLED MEAN REVERSION SPORTS GAMING IS TRADING NOT INVESTING WE ARE THE ONLY SERVICE THAT PROVIDES OUR PROPRIETARY, PROFESSIONAL

TECHNICAL ANALYSIS TOOLS, DEVELOPED BY OPTION TRADERS, TECHNICALANALYSIS TEACHERS, AUTHORS AND DEVELOPERS OF TRADING TECHNOLOGYFOR THE SPORTS GAMING PLAYER

WE TRADE WITH NO EMOTION, PREJUDICE, OR PRETENSE. OUR PRODUCTSAND SERVICES ARE SIMPLY BASED ON SOUND STATISTICAL ANALYSIS ANDPROBABILITY CALCULATIONS

WE TAKE ALL OF OUR PROBABILTY TOOLS AND CONCEPTS AND MAKE THEMUSER FRIENDLY ENOUGH THAT EVEN THE FRESHEST NOVICE WILL FIND OURPRODUCTS COMPLETELY SIMPLE TO USE WITHIN THE FIRST MINUTES OFMEMBERSHIP

BEST OF ALL,WE DO THE WORK FOR YOU

OF COURSE ALL OF THE PATENT PENDING PRODUCTS THAT THE SERIOUS SPORTSWAGERING ANALYST AND TRADER NEEDS ARE AVAILABLE AT WWW.SPORTSACTIONCHARTS.COM

GREGORY WOLFE -THE SPORTS ACTION WOLFMAN
http://www.sportsactioncharts.com/http://www.sportsactioncharts.com/http://www.sportsactioncharts.com/


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Appendix A

EXAMPLES OF FUNDAMENTAL ANALYSIS IN TRADABLE FINANCIAL INSTRUMENTS(WHAT IS PRICED IN BY THE MARKETMAKERS TO THE PRICE OF THE INSTRUMENT OR VOLATILITY OF THE OPTIONS)

PRICE (STOCKS, CURRENCIES, COMMODITIES, ETC.)

1 PRICE/EARNINGS RATIO2 PRICE/SALES RATIO3 SECTOR STRENGTH4 INDUSTRY STRENGTH5 INTEREST RATES6 ENERGY PRICES7 CREDIT RATINGS8 MANAGEMENT9 BOOK VALUE10 MARKET SHARE11 DIVIDENDS

12

LIABILITIES13 DEBT14 LEGAL ISSUES15 BUSINESS STRUCTURE16 RESEARCH AND DEVELOPMENT17 PRODUCT PIPELINE18 WEATHER (ORANGE JUICE, OIL, ETC)19 POLTICAL ISSUES (OIL, GOLD, COFFEE, ETC)20 TRADE POLICIES (CURRENCIES)21 DISEASE (PORK BELLIES, CATTLE, ETC)

OPTION IMPLIED VOLATILITY

1. UPCOMING EARNING REPORTS2. UPCOMING LEGAL DECISIONS3. PATENT EXPIRATIONS 4. POTENTIAL MERGER 5. POTENTIAL ACQUISITION 6. POTENTIAL MANAGEMENT CHANGE 7. INDUSTRY UNCERTAINTY 8. SECTOR UNCERTAINTY 9. HURRICANE SEASON (OIL STOCKS) 10. SYSTEMIC DEVELOPMENTS (FEDERAL RESERVE MEETING, ETC)11. UPCOMING POLITICAL ELECTIONS12. POSSIBILITY FOR THE STOCK TO BE ADDED/SUBTRACTED FROM AN INDEX (I.E

DOW 30, S&P 500, NASDAQ 100)

13. EXPECTED SEASONAL VOLATILITY


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Appendix B

EXAMPLES OF FUNDAMENTAL ANALYSIS IN WAGEREDSPORTING EVENTS (WHAT IS PRICED IN BY THE ODDSMAKERSTO THE HEAD TO HEAD POINTSPREAD, MONEYLINE SPREAD ORGAME TOTAL POINTS OVER/UNDER)

HEAD TO HEAD POINTSPREAD OR MONEYLINE

1. VENUE (TEAMS PAST PERFORMANCE AT HOME ANDAWAY)

2. WEATHER (OUTSIDE EVENTS, OR IF PLAYED IN A DOME)3. PERFORMANCE IN PREVIOUS MEETINGS4. PERFORMANCE AGAINST COMMON OPPONENTS5. TRENDS OR STREAKS6. PERCEIVED STRENGTH OF CONFERENCE, DIVISION OR

LEAGUE7. UNIT MATCHUPS8. INJURIES9. INDIVIDUAL MATCHUPS10. OFFENSIVE/DEFENSIVE RANKINGS

11. INCENTIVE (NEED TO WIN TO MAKE PLAYOFFS, BOWLGAME, ETC.), AS WELL AS LACK OF INCENTIVE (STARTERSNOT PLAYING BECAUSE PLAYOFF POSITION IS ALREADYDETERMINED)

12. SHORT WEEK (AMERICAN FOOTBALL)13. LEFT HANDED PITCHER VS TEAM WITH MANY LEFT

HANDED BATTERS, AND VICE VERSA (BASEBALL)14. SHORT REST FOR A PITCHER (BASEBALL)15. WARM WEATHER TEAM IN A COLD ENVIRONMENT16. EXTENSIVE TRAVEL FOR ONE TEAM, ESPECIALLY

CHANGES IN TIME ZONES17. OFFICIATING/UMPIRING CREW18. OFF THE FIELD ISSUES19. NATIONAL RANKINGS (COLLEGIATE)20. TEAMS PLAYING AT ELEVATION THAT THEY ARE NOT

ACCUSTOMED TO


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21. REVENGE FACTOR 22. 20 RULE CHANGES22 DRAFT PICKS23 TRADES/NEW PERSONNEL24 PPG OFFENSIVE AVERAGES25 PPG DEFENSIVE AVERAGES26 OFFENSIVE FIELD GOAL PERCENTAGES (BASKETBALL)27 DEFENSIVE FIELD GOAL PERCENTAGES (BASKETBALL)

GAME TOTAL POINTS OVER/UNDER

1. VENUE (PAST PERFORMANCES HOME OR AWAY,DIMENSIONS OF STADIUM RELATIVE TO PITCHERS AND

LINEUPS IN BASEBALL AS WELL AS ELEVATION INBASEBALL)2. WEATHER3. TEAMS AVG POINTS PER GAME SCORED AND ALLOWED4. INDIVIDUAL MATCHUPS5. ERAS OF PITCHERS (BASEBALL) 6. UNIT MATCHUPS7. AMOUNT OF SCORING IN PREVIOUS MEETINGS8. AMOUNT OF SCORING AGAINST COMMON OPPONENTS9. INJURIES10. SHORT REST FOR A PITCHER (BASEBALL)11. PRESUMED STYLE OF PLAY (I.E. IN AMERICAN

FOOTBALL, A TEAM WILL RUN THE BALL MORE IF THEOPPOSING DEFENSE IS WEAK AGAINST THE RUN, THUSCREATING LESS CLOCK STOPPAGES)

12. OFFICIATING/UMPIRING CREW13. OFF THE FIELD ISSUES14. STYLE OF PLAY RELATING TO THE RELEVANT

CONFERENCES/LEAGUES

15. OFFENSIVE/DEFENSIVE RANKINGS16. RULE CHANGES

17. OFFENSIVE FIELD GOAL PERCENTAGES (BASKETBALL)18. DEFENSIVE FIELD GOAL PERCENTAGES (BASKETBALL)


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Appendix C

Appendix D


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Appendix E

12/28/09

Minnesota Vikings @ Chicago Bears

Minnesota favored by 9 points

Over/Under= 41 points

Fundamental thought process of the retail bettor

1) Previous MeetingThe Vikings dominated in their first meeting of the season only 4

weeks earlier, cruising to a 36-10 victory while amassing 537 total yardsADVANTAGE: VIKINGS

2) Weather The forecast was for typical late December Chicago weather.Temperatures in the 20s, strong swirling winds, and a chance of

snow. The assumption would be for very few big plays, a highpercentage of running plays (infrequent clock stoppages), anddifficulty throwing the ballADVANTAGE: UNDER

3) Matchups-when Chicago has the ball The fundamental assumption here would be for ugliness. The Bears

entered the game with serious offensive issues, and most of them revolved

around their failed savior, quarterback Jay Cutler. Cutler entered the gamewith a league leading 25 interceptions and was fresh off a SINGLE DIGITpasser rating in a loss to Baltimore. With an inexperienced receiving corpsand a questionable offensive line, the Vikings defense was not a group hewould be looking forward to seeing. Led by All-World defensive end JaredAllen, the Vikings front four would seemingly be licking their chops over the


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Appendix E

prospect of getting pressure on the presumably rattled Cutler. Throw in2009 pro bowl corner back Antoine Winfield to handle the recently

morphed defensive back turned receiver Devin Hester and a long night forCutler would seem to be at hand. Conventional wisdom would say that amajority of the load would then fall on young Bears running back MattForte, but with the aforementioned matchup problems for Chicago in thepassing game, Minnesota would ostensibly be able to put 7 or 8 defendersin the box all night and neutralize any attempt Chicago makes at arunning game.

ADVANTAGE: VIKINGS/UNDER

-when Minnesota has the ball Brett Favre was in the midst of what would be another pro bowl year

and behind him in the backfield was perhaps the gam es most productiverunning back, All-Pro Adrian Peterson. With their perennial pro bowlmike linebacker Brian Urlacher out for the year, the Bears werequestionable against the run. In addition, their top defensive lineman,Adewale Ogunleye, broke his leg the week before and was also out. Onewould assume a heavy dose of Peterson the entire game with theoccasional, well timed play action passing that had been working all season.

The earlier game between the two showed that the Bears couldnt stop th eVikings with Ogunleye, let alone without him. Once againmore runningplays leads to less clock stoppages.

ADVANTAGE: VIKINGS/UNDER

-special teamsCold, windy weather leads to ugly punts, missed field goals and

mistakes that cost points. Also, the Vikings are a dome team, so theirspecialists would be presumed to feel it even more.

ADVANTAGE: UNDER

4) RecordsMinnesota entered the game at 11-3 (5-0 in the division)Chicago entered the game at 5-9 (1-3 in the division)ADVANTAGE: VIKINGS


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Appendix E

5) TurnoversAs alluded to earlier, Bears QB Cutler was an interception machine of

Testaverde-esque proportions . However, it should be mentioned thatVikings RB Peterson also has a penchant for putting the ball on the deck.Many turnovers usually lead to missed opportunities to score.

ADVANTAGE: UNDER

6) Incentive (this is most likely the highest valued component of the retailbettors weapons of fundamental logic)

In this case the Vikings had EVERYTHINGTO PLAY FOR AND THEBEARS HADNOTHINGTO PLAY FOR. With a win and an Eagles loss or tie,

the Vikings would have clinched the very important first round playoff bye,and #2 seed in the conference. In addition, they were still technically aliveto clinch home field throughout if they won their last two games and NewOrleans lost their last two games. Minnesota is regarded by most to havethe heaviest home field advantage in the league, so home field advantagethroughout the playoffs would have been huge for them. On the otherhand, Chicago had been out of the playoff picture for a while and mostlikely their attention was pointed towards not getting hurt, positioning forthe draft, and off season golf accommodations.

ADVANTAGE: VIKINGS

7) Miscellaneous-Most retail bettors enjoy betting Favre in primetime (emotion)-Most retail bettors presume Favre to be a good cold weather

quarterback (emotion) -The line moved from Minnesota -7 to Minnesota -9 in many places,

the total moved from 42 to 41

At this point it should be quite clear to the s portshandicapper, the ca sual fan, the touts, the dedicated gamblers, thefantasy gurus, etc, etc., that the conventional wisdom, fundamentalanalysis for this particular ballgame can result in only one logicalconclusionTHE VIKINGS AND THE UNDER. I mean we presented quite a


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Appendix Estrong case here for both the against the spread and over/underwager. So the retail bettor does his fundamental due diligence (or worse,he listens to a paid tipster or pedestrian sports radio/TV host and his due

diligence) and lays it down quite confidentlyMinnesota and theunderor Minnesota and the under parlay/reverse/tease, etc. It seemslike a no brainer with all of this overwhelming data. There is only oneproblem. All of this time consuming fundamental analysis is irrelevant.The odds, spread and total have been determined by superior qualitativedata collection and the laws of supply and demand. CHICAGO WINS THEGAME 36-30 IN OVERTIME. ALL OF THE BETS THAT TOOK THE VASTEVIDENCE PRINTED ABOVE, OR ANYTHING LIKE IT, AND BET THE VIKINGSAND THE UNDER LOST IN EVERY WAY POSSIBLE.

HOWEVER, THE HISTORICAL DATA TECHNICAL ANALYSIS TOOLSAT SPORTSACTIONCHARTS.COM OPERATE OUTSIDE THESE BOUNDARIES.OUR TOOLS DETERMINED THAT THE VIKINGS WERE OVERBOUGHT ANDTHE BEARS WERE OVERSOLD IN THE HIGHLY STATISTICALLY SIGNIFICANTRANGE. ALSO, OUR TOOLS DETERMINED THAT THE UNDER WASOVERBOUGHT AND THE OVER WAS OVERSOLD IN THE HIGHLYSIGNIFICANT RANGE. SO WE SIMPLY KEPT WITH OUR VERY SIMPLETHEME AND BOUGHT LOW AND SOLD HIGH. (THE ACTUAL CHARTINGAND NUMBER QUANTIFICATION FOR THIS GAME IS REPRESENTED IN

APPENDIX F). In addition, countless minutes or even hours of fruitlessanalysis by the bettor could have instead simply been an alert via email,rss feed or text message from sportsactioncharts. Time is very precious.

Bear in mind that this is only one example, and there are severalexamples that could be found in all of the history, in all of the

wagered sports that turned out to have quite the opposite outcome.The purpose here is not to say that fundamental analysis of sportingevents is not relevant. The purpose here is for the retail bettor tounderstand that those who set the odds for wagerable events simplyhave greater access to

becoming a sports trader

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