Football picksOctober 22, 2010

The Two Best Bad Teams in the NFL

What does a coin flip have in common with the Cowboys and Chargers?

The Dallas Cowboys and San Diego Chargers were considered Super Bowl contenders at the start of the year. They now sit collectively at 3-8. Two cities are collectively on suicide-alert and many sports bettors are perplexed. Are these just bad teams that were never deserving of the preseason praise? Possibly. But I think it’s probably something different.

I belive these two teams are much better than they appear and have largely been victims of mostly random bad luck. I know, most of you are going to decry me a numbskull for a statement like that. That’s fine. I may be wrong. But I may be right!

Yes, I know both of these teams have perennial whipping boys at coach. I won’t argue that Norv Turner and Wade Phillips are great coaches. They both have demonstrated that they can lose games for their teams. Neither seems to have the fire-and-brimstone approach that we associate with great coaches.

But, are they the sole reason these teams have so radically underperformed expectations? I don’t think so. I think they have contributed to the problem, but there’s got to be something more at play here. Six games into the season, I might attribute one extra loss to each of these guys, but at 3-8, there is something else at play here.

So is it the talent? Are these teams really just not that talented? The reality is that that by one important measure (yards gained and yards allowed), these two teams are playing brilliantly! How brilliantly? Consider that Dallas is ranked 4th in the league in total defense and 3rd in the league in offense. Think about that – they are in the top 5 in both offense and defense, yet sit at 1-4. The story with San Diego gets even crazier! San Diego leads the league in BOTH offense and defense. That’s right, they are #1 in offensive yards at 433 per game and #1 in defensive yards allowed at 255 per game. Yet they sit at 2-4.

How insane is it to have a team that leads the league in both yardage categories own a losing record? Well, it’s never been done. Since 1970, there have been a total of 19 weeks in which a team has owned the best offense and defense (as measured by yards). Prior to this year, the combined record of the teams involved at the time they led the league was 62-6. Yet the Bolts are 2-4. That’s what you call a statistical anomaly.

So what is the reason we have these two teams that have moved the ball so well, and have stopped their opponents from moving the ball very well, losing 73% of their games thus far this season? A lot of it is luck. Bad luck.

It’s not all luck. Again, some poor coaching, undisciplined play (penalties) and bad special teams play have contributed. These items are at least in part in the control of the team and can be considered skill vs. luck. But, some penalties and special teams performance (one missed tackle) is due to luck. Turnovers also have a skill and luck component, but these are largely luck. San Diego is -3 in turnovers and Dallas is -5.

Most people underestimate the role of luck in their lives, and on the football field. There have been books written on the subject (see Malcolm Gladwell’s Outliers). Most people assume that when a team is winning, it is skill, not luck. They assume that if they get a promotion and a high-paying job, it’s skill, not luck. They assume that if a team is 1-4, it’s due almost entirely to skill, not luck. Just Win Baby. The reality is that luck plays a much larger role in our lives than we tend to admit. One or two bounces of the ball and these two teams aren’t 3-8 but maybe sitting closer to .500. Take their especially bad luck and make it especially good, and they are both winning teams.

What does this all mean for us as sports bettors? It means that these two teams are quite  likely to be undervalued, on average, the remainder of the season. Regression to the mean is a term statisticians use to describe the phenomenon of abnormal outcomes approaching the expected outcome over time. In other words, if a team is really unlucky for a while, chances are their luck will even out and they will improve. It’s not guaranteed, but it’s likely. If a team is very lucky, that great luck isn’t likely to continue at that same rate. If a good team is somehow losing a lot of games, they are likely to find more wins in the future.

Another way to look at this is to ask the following question: If a fair coin is flipped 10 times and comes up heads 8 times, what is the expected outcome if that same coin is flipped 100 more times? The answer is that we should expect something very close to 50 heads and 50 tails, not 80 heads. The same holds true for the record of football teams. If we think the Chargers and Cowboys are actually above average teams (I do), and their horrible records thus far are due largely to dumb luck vs. an inherent skill problem (I do), then we should expect a reversion to the mean. We should expect them to win more games than they lose the rest of the season.

Now, over the short term, anything can happen. Over the short term, more bad luck can certainly ensue. And, the quality of their opponents have a big impact in the short-term. So, I am not guaranteeing that one or both of these teams will become winning teams this season.

What I am saying is that there is likely value in backing these teams moving forward. As public sentiment turns against them, the lines they face will be shaded. As a result, there will likely be value in backing them. And, the more they lose, the greater that value will become.