“It’s getting late early” – Yogi Berra.
Although we don’t advise or invest in the AFL premiership market ourselves as part of our service, we do like to monitor this market. A sports investment approach can use it as a barometer for perception. When looking at a premiership market – the teams are essentially ranked on the basis of their chances at prevailing on Grand Final day. This much is obvious.
Where the information can be useful is in using it as a proxy for the general strength of the team at the current moment of the quote. Important to consider is that the prices are particularly sensitive to recent performances. A team could be undefeated all year and suffer a shocking loss in say, round 15, and quickly drift. Markets hate uncertainty.
Carlton’s shock loss (and injury concerns) as $1.13 head to head favourites on the weekend against Essendon had immediate repercussions in the premiers market with respect to the Blues.
First of all, the general market after round 4:
Carlton’s individual Chart.
The sensitivity of this market to this weekend’s loss is shown by the sharp “uptick” in price. The quote was sub-$5 pre-game, and eased sharply – which is likely to have occurred even before the final siren of the Essendon-Carlton match on the weekend. The price shot out to over $6 briefly, before settling at the current quote of $5.60/5.70.
What can we discern from the premiers markets being weekly sports investors ourselves?
Well, the above market will indicate which teams are perceived to be the current “popular” teams. From this you can pinpoint where the individual team’s strength rating sits, which has an impact on weekend betting. Teams favoured/firming in premiership markets can be expected to be backed leading into upcoming games (both at the point spread and moneyline), while the reverse is true to teams out of the premiership hunt. This is more true when large volumes have been staked on that team (currently Carlton has $69,796 market volume).
Looking to position on a popular premiership team this coming weekend? Usually taking a price for the coming game is better to do sooner (from a value perspective) than later, provided weather and injuries are not a concern. Round 4 for example saw Carlton firm from -35.5 point favourites on Monday/Tuesday to -43.5 point favourites at the bounce.
EDIT: The reason we avoid premiership markets is – were someone to sign up with us mid-season, this member wouldn’t have the luxury of being positioned on a team that may now have firmed… and firmed into a position where we start hedging against that team. Members joining during the season could feel marginalised as a result.