GREED IS BAD: THE PITFALLS OF CHALK PARLAYS
My good friend fletcher from the Message Forum once gave me a piece of advice that I often think about to this day: the best value is a winning ticket. In other words, many times it is better to ensure yourself of a cashed ticket in lieu of the possibility of a higher payout.
This thought crossed my mind again on Monday when Schilling, Clemens and Martinez all pitched against inferior opposition on the same day. Not so much because I expected folks to pay -270 and the like to back these Hall of Famers in straight bets, but because I could just feel the gears in the brains of many gamblers working up ways to correlate those three into parlay wagers.
Just as handicappers are frequently told to avoid runline favorites because they are sucker bets, handicappers should also be warned about chalk parlays. Chalk parlays are attractive bets to the average player for a number of reasons. Unlike in other sports, you are backing heavy favorites only to win, not to cover some spread (i.e. their motivation is the same as yours). Additionally, while many gamblers become scared by the big money it takes to back stud pitchers to make a profit in straight bets, parlays cut down on the juice of the overall wager. So there the average gambler can sit, Coors Light in hand, rooting for teams with big name stars who are likely to win with a bet on the line that won't cost him an arm and a leg if it loses but will generate a decent profit if it wins.
Chalk parlays are the classic example of playing short term handicapping rather than long term handicapping. No matter what the odds look like on a parlay, the bettor is still paying whatever juice exists on a straight bet over the long haul. And in fact, the risk becomes even greater because a number of bets must hit all at once for the gambler to have a winning day. There has long been talk on this site (much of it thanks to the excellent analysis of Nolan Dalla) about the pitfalls of parlays and the idea that parlays, when played sparingly, should be correlated in some way to give the gambler the best chance at a profit. To add to that talk, I've decided to give a little breakdown example of how chalk games are better played straight up rather than in a parlay.
It is a well known fact that gamblers should look at the amount they can afford to risk rather than the amount they want to win when setting a bankroll and making daily plays. That means that if you have decided that 10% of your bankroll should be wagered overall on any given day, the amount you have risked should equal that number, not the amount you are attempting to win. That approach certainly takes discipline and it leads gamblers to be tempted by chalk parlays in the following way.
Let's say a gambler with a $5,000 bankroll looks at Monday's card and sees Clemens and Schilling both pitching at home. To make things easier to calculate, let's put both lines Clemens at -280 and Schilling at -220. Wagering $280 to win $100 on Clemens and $220 to win $100 on Schilling is a tough proposition. It means you have no money left over for other action and your maximum profit for the day is a measly $200. Of course, with Clemens' loss, the reality is that you would have lost $180 on the day.
On the other hand, what if you parlay the two? The odds on a parlay are -103. Therefore, to make the $200 you desired, you would risk only $206 and have almost $300 remaining the rest of the day to make a profit. Sounds great, right?
The flaw in this thinking is that the risk of the two bets are different. If you are willing to take the smaller profit on each play as a straight bet, you would win $45 on a $100 bet on Schilling and lose $100 on a $100 bet on Clemens. Therefore your total loss is just $55 rather than $200.
If we even out both bets to -250, here is the comparison of parlaying chalk and playing it straight up:
BOTH GAMES WIN:
Straight Up: Win $100/$40 wagers on two bets. Profit = $80.
Parlayed: Win $200/$194 wager on a parlay. Profit = $194
GAMES SPLIT:
Straight Up: Win one $100/$40 bet, lose the other. Profit = (-$60)
Parlayed: Lose $200/$194 wager on a parlay. Profit = (-$200)
BOTH GAMES LOSE:
Straight Up: Lose both $100/$40 bets. Profit = (-$200)
Parlayed: Lose $200/194 wager on a parlay. Profit = (-200)
When both games lose, it's a wash. Same result. When both games win, the parlay is clearly the better bet, as your profit increases by almost 150%. When you lose one and win one, however, your loss increases by a whopping 233%.
Clearly, you must hit a number of parlays compared to the number you split to make parlaying chalk a profitable venture. And even outside of mathematics there is a another caveat. You see, we all know that chalk parlays rarely lose both games. Any seasoned gambler will tell you that it is unlikely to see two large favorites go down in the same day. Certainly it happens on occasion, but the main roadblock in chalk parlays isn't going to be going 0-2, it's going 1-1.
Parlays are at their worst when they go 1-1 and at their best when they go 0-2 or 2-0. At 2-0, the profit is obviously maximized. At 0-2, the loss is minimized because you are only losing one wager, but losing two games. At 1-1 however, the gambler is robbed of the vig loss that comes with a split and they take a full fledged loss on the wager. Since the prospect of an 0-2 is almost totally taken out of the equation with a high chalk parlay, those 1-1 days that are so frustrating take an even bigger long term toll on your bankroll.
I have come to believe that playing chalk can be a profitable venture, but it takes discipline. Chalk parlays are generally greedy plays that show a lack of discipline. Wager the chalk plays straight and be happy with the smaller profit on 2-0 days and grin and bear the small loss on 1-1 days.
As an added note, here are some other rules I would govern myself by if I wanted to play mostly chalk in baseball.
1. Play relatively few plays. The more plays you make per day the more the vig will add up over the long term.
2. Play money "to risk" rather than "to win". It can be frustrating taking small profits on chalk bets but over the long term it helps avoid disastrous days when losing streaks hit.
3. Don't blindly back star pitchers. Everyone knows how good Schilling is, so where is the value in that? Lots of times you can find a superior team with a slightly superior pitcher at a reasonable price in the -145 to -170 range. I think that is the range to look at when playing chalk.
It takes a high percentage to make a profit on chalk plays, but hitting 65% is not out of the question if you stay disciplined and do the work required. And don't forget, play the chalk straight rather than in parlays.
My good friend fletcher from the Message Forum once gave me a piece of advice that I often think about to this day: the best value is a winning ticket. In other words, many times it is better to ensure yourself of a cashed ticket in lieu of the possibility of a higher payout.
This thought crossed my mind again on Monday when Schilling, Clemens and Martinez all pitched against inferior opposition on the same day. Not so much because I expected folks to pay -270 and the like to back these Hall of Famers in straight bets, but because I could just feel the gears in the brains of many gamblers working up ways to correlate those three into parlay wagers.
Just as handicappers are frequently told to avoid runline favorites because they are sucker bets, handicappers should also be warned about chalk parlays. Chalk parlays are attractive bets to the average player for a number of reasons. Unlike in other sports, you are backing heavy favorites only to win, not to cover some spread (i.e. their motivation is the same as yours). Additionally, while many gamblers become scared by the big money it takes to back stud pitchers to make a profit in straight bets, parlays cut down on the juice of the overall wager. So there the average gambler can sit, Coors Light in hand, rooting for teams with big name stars who are likely to win with a bet on the line that won't cost him an arm and a leg if it loses but will generate a decent profit if it wins.
Chalk parlays are the classic example of playing short term handicapping rather than long term handicapping. No matter what the odds look like on a parlay, the bettor is still paying whatever juice exists on a straight bet over the long haul. And in fact, the risk becomes even greater because a number of bets must hit all at once for the gambler to have a winning day. There has long been talk on this site (much of it thanks to the excellent analysis of Nolan Dalla) about the pitfalls of parlays and the idea that parlays, when played sparingly, should be correlated in some way to give the gambler the best chance at a profit. To add to that talk, I've decided to give a little breakdown example of how chalk games are better played straight up rather than in a parlay.
It is a well known fact that gamblers should look at the amount they can afford to risk rather than the amount they want to win when setting a bankroll and making daily plays. That means that if you have decided that 10% of your bankroll should be wagered overall on any given day, the amount you have risked should equal that number, not the amount you are attempting to win. That approach certainly takes discipline and it leads gamblers to be tempted by chalk parlays in the following way.
Let's say a gambler with a $5,000 bankroll looks at Monday's card and sees Clemens and Schilling both pitching at home. To make things easier to calculate, let's put both lines Clemens at -280 and Schilling at -220. Wagering $280 to win $100 on Clemens and $220 to win $100 on Schilling is a tough proposition. It means you have no money left over for other action and your maximum profit for the day is a measly $200. Of course, with Clemens' loss, the reality is that you would have lost $180 on the day.
On the other hand, what if you parlay the two? The odds on a parlay are -103. Therefore, to make the $200 you desired, you would risk only $206 and have almost $300 remaining the rest of the day to make a profit. Sounds great, right?
The flaw in this thinking is that the risk of the two bets are different. If you are willing to take the smaller profit on each play as a straight bet, you would win $45 on a $100 bet on Schilling and lose $100 on a $100 bet on Clemens. Therefore your total loss is just $55 rather than $200.
If we even out both bets to -250, here is the comparison of parlaying chalk and playing it straight up:
BOTH GAMES WIN:
Straight Up: Win $100/$40 wagers on two bets. Profit = $80.
Parlayed: Win $200/$194 wager on a parlay. Profit = $194
GAMES SPLIT:
Straight Up: Win one $100/$40 bet, lose the other. Profit = (-$60)
Parlayed: Lose $200/$194 wager on a parlay. Profit = (-$200)
BOTH GAMES LOSE:
Straight Up: Lose both $100/$40 bets. Profit = (-$200)
Parlayed: Lose $200/194 wager on a parlay. Profit = (-200)
When both games lose, it's a wash. Same result. When both games win, the parlay is clearly the better bet, as your profit increases by almost 150%. When you lose one and win one, however, your loss increases by a whopping 233%.
Clearly, you must hit a number of parlays compared to the number you split to make parlaying chalk a profitable venture. And even outside of mathematics there is a another caveat. You see, we all know that chalk parlays rarely lose both games. Any seasoned gambler will tell you that it is unlikely to see two large favorites go down in the same day. Certainly it happens on occasion, but the main roadblock in chalk parlays isn't going to be going 0-2, it's going 1-1.
Parlays are at their worst when they go 1-1 and at their best when they go 0-2 or 2-0. At 2-0, the profit is obviously maximized. At 0-2, the loss is minimized because you are only losing one wager, but losing two games. At 1-1 however, the gambler is robbed of the vig loss that comes with a split and they take a full fledged loss on the wager. Since the prospect of an 0-2 is almost totally taken out of the equation with a high chalk parlay, those 1-1 days that are so frustrating take an even bigger long term toll on your bankroll.
I have come to believe that playing chalk can be a profitable venture, but it takes discipline. Chalk parlays are generally greedy plays that show a lack of discipline. Wager the chalk plays straight and be happy with the smaller profit on 2-0 days and grin and bear the small loss on 1-1 days.
As an added note, here are some other rules I would govern myself by if I wanted to play mostly chalk in baseball.
1. Play relatively few plays. The more plays you make per day the more the vig will add up over the long term.
2. Play money "to risk" rather than "to win". It can be frustrating taking small profits on chalk bets but over the long term it helps avoid disastrous days when losing streaks hit.
3. Don't blindly back star pitchers. Everyone knows how good Schilling is, so where is the value in that? Lots of times you can find a superior team with a slightly superior pitcher at a reasonable price in the -145 to -170 range. I think that is the range to look at when playing chalk.
It takes a high percentage to make a profit on chalk plays, but hitting 65% is not out of the question if you stay disciplined and do the work required. And don't forget, play the chalk straight rather than in parlays.
