Document Type
Article
Date
3-12-2024
Keywords
behavioral bias, daily fantasy sports, baseball, hot hand, informed trader, smart money
Language
English
Disciplines
Sports Sciences
Description/Abstract
The behavior of informed traders, or 'smart money,' in sports betting markets has long been f interest to researchers. In this paper, we focus specifically on the behavior of smart money in Major league Baseball (MLB) daily fantasy sports (DFS) contests to determine if they avoid cognitive behavioral biases to increase their expected earnings. Specifically, we investigate whether smart money avoids the hot hand bias, where individuals tend to overestimate the likelihood of success for players on a hot streak. Using a dataset of MLB DFS contests, we find that winning lineups have lower usage rates for players exhibiting the hot hand strategy to increase their expected earnings.
Recommended Citation
Losak, Jeremy M.; Weinbach, Andrew P.; and Paul, Rodney J., "Does Smart Money Believe in the Hot Hand? Evidence from Daily Fantasy Baseball" (2024). Sport Management - All Scholarship. 64.
https://surface.syr.edu/sportmanagement/64
Source
submission
Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.
