Who Will Win the World Cup? A Quantitative Approach.
As a Continental European living in the United Kingdom, watching the games over a pint at the pub and England getting kicked out of the tournament aren’t the only two exciting things about the 2018 FIFA World Cup. The United Kingdom is probably also the country where the most sports betting is taking place during the tournament.
There’s a surprising number of events that bookmakers offer you the chance to place bets on, for example, “Will Morocco reach the Quarter Final?” I for one don’t have particularly strong convictions about that question, but it seems that clearly, some people do: On one betting exchange alone, £6,925 has been wagered on that single event. In total, more than 10 million pounds of bets have been placed on the same platform. As a data scientist, it’s exciting to observe how all of that punting, in aggregate, produces a quite comprehensive collective valuation of the chances of success for each of the teams.
The big question is of course “Who will win the World Cup?” Crunching the numbers, one can work out the implicit probabilities in the odds offered for each team. As of 9 AM today, the odds were as follows:
Let me give you an example of how these odds are derived: As of today bookmakers are offering you to bet on Brazil winning the tournament with a payout of 5.2 times your bet…