“The league table never lies.”
A statement we’ve all heard before, most often towards the back end of a season, but does it hold up?
Of course it depends on the way you look at it, but at Stratagem our firm belief is that the league table does lie and on a more frequent basis than you might expect.
Sometimes these lies can be marginal ones, but on occasion they can be much bigger. These “big lies” almost always lead to trading opportunities.
You might be wondering what we mean by “big lies” and, more importantly, how you can spot them yourself.
To explain, let’s take a look at the English Premier League table after 15 rounds:
A quick eye test of the standings throws up a couple things that just appear to be plain “wrong”. Leicester City are top in mid-December, for starters, while champions Chelsea find themselves in mid-table and are far closer to the bottom three than the top four.
However, just because something “looks wrong” does not mean that it is wrong. The table essentially tells us that Leicester City are performing well above expectations and Chelsea well below. Do these teams deserve to be where they are, though?
This is what we, as football analysts and traders, are really interested in.
Our team of expert analysts give “Fair Score” judgements of every game that we review on our Data Collection Platform. They use a variety of factors to come to their decision, weighing things such as chance creation, momentum, pressure, tactical approach and controversial decisions.
Thanks to this we are able to maintain a weekly “Analyst Fair Score Table”, which currently looks like this in the English Premier League:
According to this Leicester and Chelsea are largely deserving of their current rankings and the “big lies” that our analysts believe the current table is telling us actually revolve around Liverpool, Southampton and Norwich City.
Jurgen Klopp’s men are currently four places higher in the league than they perhaps deserve to be, while Southampton and Norwich are five places below. Interestingly both the Actual Table and Fair Score Table are aligned on ten teams in total, including the entirety of the bottom four.
It is important to acknowledge there is a fair amount of subjectivity at play here, given that we are accepting a purely human judgement on what a “fair score” should have been in any given match. However, we train our analysts to the highest possible standards and also try to eliminate personal biases along the way, in order to minimise the risk of error.
Also, to add another perspective, our in-house Quantitative Research team have built a “Fair Outcome Model” using our proprietary analyst data.
The difference between “outcome” and “score” looks quite subtle, but is a key thing to highlight. This model does not reward teams in whole goals or even complete points, instead rewarding teams a share of the points available depending on their in-game performance metrics.
These metrics are fairly wide-ranging, but primarily focus on chance creation and concession:
Firstly we see that Leicester and Chelsea are again believed to be in their “correct” positions in the table, more-or-less, but the model suggests that the Actual Table is far less trustworthy than the analysts led us to believe.
Stoke City, Norwich and Bournemouth the only teams it is aligned on and the two biggest lies the model thinks are being told revolve around West Ham and Southampton (again). In its view West Ham should be six places below where they actually are, with Southampton six places above.
The interesting thing here is that the analysts and the model both agree that Southampton are deserving of a much higher league ranking based on their performances and the performances of those around them.
Aside from the teams mentioned everyone else is apparently close enough to where they “should” be, though Manchester United have apparently been over-rewarded and West Bromwich Albion under-rewarded by 3 places apiece.
Finally, let’s look at a point-by-point comparison of the teams across all three versions of the table:
This graph gives a very clear representation of how teams have been rewarded, how the analysts believe teams should have been rewarded and how the model believes teams should have been rewarded.
The truth probably lies somewhere between the three lines. As such, from this you can begin to build a more accurate picture of how teams have performed so far this season.
When you compare this to weekly outright market prices you can begin identifying trading opportunities.
Adding further layers of analysis like looking at performances against certain “groups” of teams and assessing line-up strength per game can enhance the accuracy further. We will look at how to do this in a future blog post.