The Wisdom of Bookies? Sentiment Analysis vs. the NFL Point Spread

The American Football betting market provides a particularly attractive domain to study the nexus between public sentiment and the wisdom of crowds. In this paper, we present the first substantial study of the relationship between the NFL betting line and public opinion expressed in blogs and microblogs (Twitter). We perform a large-scale study of four distinct text streams: LiveJournal blogs, RSS blog feeds captured by Spinn3r, Twitter, and traditional news media. Our results show interesting disparities between the first and second halves of each season. We present evidence showing usefulness of sentiment on NFL betting. We demonstrate that a strategy betting roughly 30 games per year identified winner roughly 60% of the time from 2006 to 2009, well beyond what is needed to overcome the bookie’s typical commission (53%).