The Vegas Watch Index
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by user Airjakub2
A couple weeks ago at my site, Vegas Watch, I introduced a new way of creating power rankings, the Vegas Watch Index (VWI). What I do is take the Vegas betting lines for every team, every day, and collect them for each team. Each money line can be translate into a team's predicted chance of winning each game. So for each game I take into account that percentage, as well as the strength of the opponent. Weighting each of these factors equally, and doing this for every game, I have created a ranking of the strength of each team.
The interesting thing about VWI is it doesn't care about a team's past performance. The people setting the lines in Vegas are strictly concerned with how a team will do in the game they are setting the line for, rather than how they have done in the past. The best example of this can be seen in my first VWI. At that point on June 4th, the Yankees had not yet gone on their current tear, and were about 13 games behind the Red Sox. But VWI had the Yankees first in the power rankings, and in the last couple weeks they have lived up to that billing. Sometimes this can be counterintuitive, as we allow a team's past performance to unrealistically effect our view of their actual strength.
Here is the current VWI for the American League (through Sunday's games):
I would like to clear up one common misconception about VWI, and Vegas lines in general. I have heard from various people that they think the Yankees are ranked so high because they "have so many fans who bet on them". There are two flaws with this logic. First, I don't think the Yankees have a significant amount of people betting on them just because they're the Yankees to move the lines at all. Second, if they somehow did, more intelligent bettors would take advantage and bet against the Yankees, and the lines would move back to where they should be.
VWI can also be used to derive a predicted winning percentage for the team going forward. And this is where it is really useful, as that predicted winning percentage can be used alongside the team's current record to predict where each team will finish in the final standings. That is precisely what I have done with the following predicted standings.
Despite the Yankees' lofty ranking, VWI does not expect them to make up the large deficit they have created for themselves. The Red Sox may not lead the league in VWI like the Yankees, but they happen to lead the Yankees in the standings by 8.5 games, and have an impressive .555 expected winning percentage themselves.
The Indians currently have a one game lead on Detroit, and have a slightly higher expected winning percentage (.544-.537), which causes the predicted two gam margin. Most notable is the fact that VWI thinks that the Yankees, Indians and Tigers will be fighting it out for two playoff spots down to the last weekend of the season.
The Angels currently enjoy a comfortable six game lead in the division. To make matters worse for Oakland and Seattle, VWI doesn't think either team sustain their current pace (for the Mariners, their -2 run differential also points toward this result). These two factors combine to create a very optimistic outlook for the Angels, as it seems they should win the division fairly easily.
If you have any comments, questions, or suggestions, please e-mail me at jnwheat@emory.edu.
More of my work regarding VWI, Adjusted WPA, an early look at the MVP races and more can be found over at Vegas Watch.
