Read an Excerpt
Part I: The Market and How to Invest
1.
Fundamental
Principles of the Market and Investing. It is
important to understand the market that you will be playing in-the way sports
books operate and their similarities to other markets and exchanges. Also, there
are a handful of particularly important principles of investing that must be
fully understood and internalized to be successful.
2.
Viewing
the Season. The
season is long; it is comprised of several phases-for individual teams and all
the teams in a conference. During these phases, coaches sometimes employ
different strategies, and players sometimes perform in different ways.
Understanding the season from a coach's perspective is valuable to investors who
will benefit from thinking like coaches and anticipating
change
3.
Investment
Opportunities. There
are many ways to invest in men's college basketball. The number of ways seems to
increase each year. Some are fair investments-the sports book balances the risks
between you and other investors. Others are basically sucker investments in
which books shift the entire risk and more to investors. It is important to know
the types of investments to undertake and those to stay away
from.
4.
The Virtue
of Specialization. A
minimum condition for gaining advantage is to know more than other investors.
This leads to the idea of specializing in one conference and developing an
encyclopedic knowledge of each team and its players. Selecting the right
conference to specialize in is one of the most important decisions in the entire
investing process.
5.
Investing
and Money Management. Part of
the discipline of investing is adhering to a well-defined process day in and day
out-a process of systematically searching for investment opportunities,
formulating compelling investment theses, determining investment levels, and
finding the best deal in the market. Each step in the process offers a source of
investing advantage; when all steps are executed flawlessly, there are great
advantages and large returns.
6.
Match-up
Analysis. The
fundamental unit of investing is games. Each game offers a set of potential
investment opportunities. Only by carefully evaluating the two teams that are
playing in a very systematic way can you find excellent investing opportunities.
The trick is to do this thoroughly and intelligently so that the best investment
opportunities can be identified quickly, and many days of analysis are not
wasted in analyzing games that you will not invest in. It is important to
remember that this is not entirely a quantitative process; qualitative factors
play a big role and discriminate between investors who merely crunch numbers and
those who intelligently apply knowledge of the game of
basketball.
7.
Investing
Infrastructure and Data Management. To
efficiently execute an investment strategy, you must have the right data, at the
right time, manipulated and presented in the right way. Similarly, you must have
the ability to make investments quickly using a set of accounts with sports
books, in the same manner as you would use brokerage accounts. In some measure,
an investor in men's college basketball has the same type of infrastructure and
tools as a stock trader.
Part II: Applying the Methodology in
the 2003-2004 Season
8.
Season
Results. This
chapter displays the investing results for the season. It enumerates every
investment and the outcome. It describes the measures you should use to
figure out how well you are doing. Finally, this chapter includes an analysis of
the results that demonstrate many of the principles and guidelines that are
fundamental to the investing methodology
9.
Pre-Season
Assessments. A key
element of the methodology is to evaluate each team in the target conference
prior to the start of the season-forecasting early season performance and, more
importantly, identifying the things to watch that might indicate trends in team
performance. This chapter is comprised of the actual pre-season assessments
prepared for each of the teams in the Atlantic 10 Conference for the 2003-2004
season.
10.
Early
Season Investments. This
chapter is comprised of the in-depth analyses prepared for each of the games for
which investments were made prior to the start of the conference season. These
papers illustrate how to analyze games and how strong an "investment thesis"
needs to be before placing money at risk. Further, the outcome of each game is
reported and reasons for losing investments identified.
11.
Conference-Season
Assessment. Before
the conference season begins, it is necessary to assess each team in the same
manner as the pre-season assessment. By the end of December, there is a track
record for each team. Also, the beginning of the conference season is a new
beginning for many teams and the opportunity for coaches to make adjustments.
These assessments are intended to systematically anticipate what will occur at
the outset of the conference season-when the past may not be an entirely
reliable indicator of future performance. This chapter is comprised of the
assessments prepared for each Atlantic 10 team in December
2003.
12.
Conference-Season
Investments. This
chapter is comprised of the in-depth analyses prepared for each of the games for
which investments were made during the Atlantic 10 Conference season. The
outcome of each game is reported and reasons for losing investments are
identified.
