Non-Transitive Patterns in Sports Match Outcomes: A Profitable Anomaly

Jan C. van Ours

No 19973, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: While sports betting markets share similarities with traditional financial markets, they are more accessible for empirical research thanks to availability of high-quality data, straightforward betting procedures, and the finite duration of events. As a result, they are often analyzed for market efficiency and serve as a field laboratory for studying financial markets. This study examines 24 seasons of English Premier League matches, revealing consistent non-transitive patterns in match outcomes among various triads (groups of three clubs). These empirical findings are difficult to rationalize and represent a notable anomaly. Bookmakers ignore the non-transitive patterns when setting odds. Faced with a trade-off between efficiency using historical information and maintaining consistency, they prioritize consistency.

Keywords: Market; efficiency (search for similar items in EconPapers)
JEL-codes: C25 D01 Z2 (search for similar items in EconPapers)
Date: 2025-02
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