{"id":120136,"date":"2019-11-20T15:00:27","date_gmt":"2019-11-20T23:00:27","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/gambling-with-an-edge\/?p=120136"},"modified":"2025-01-23T16:18:02","modified_gmt":"2025-01-24T00:18:02","slug":"mattress-mack-and-the-astros-hedge","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/gambling-with-an-edge\/mattress-mack-and-the-astros-hedge\/","title":{"rendered":"Mattress Mack and the Astros Hedge"},"content":{"rendered":"\n

Postscript<\/strong><\/p>\n\n\n\n

In 2022, Mack bet $10 million to win $72.6 million if the Houston Astros beat the Philadelphia Phillies in the World Series. When the Astros won 4 games to 2, Mack collected on the biggest sports bet of all time (and more than the entire state of Nevada has ever won in an entire month). The total payout was split among multiple books, but it was all on the Astros to win; the biggest portion, $30 million, came courtesy of Caesars. Mack brought a wheelbarrow to collect (click for video<\/a>). <\/p>\n\n\n\n

Update 11\/20<\/strong><\/p>\n\n\n\n

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As mentioned, the entire play ran 42 days. During that time, Frank and I talked every day to plan and make the bets. While most of the work was done in my office, where we could access betting lines via computer, we found that it was helpful to go to an outside venue to clear our heads. Our almost-daily meeting spot became the Crown & Anchor British pub. There are two in town — the “Big Crown” on E. Tropicana and the “Little Crown” on W. Spring Mountain.<\/p>\n\n\n\n

We met at the Little Crown, which is closest to my office, almost always at noon. The reason is that from noon to 1 pm, both bars run a “gambler’s happy hour.” Play $200 through a machine and get $20 in free-play. We’d partner up and play each day while we discussed the hedge and the timetables. Mack would often call right around that time and we’d walk outside where the reception was better.<\/p>\n\n\n\n

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The Happy Hours run at both Crowns from midnight to 1 am, noon to 1 pm, and 5 pm to 6 pm and you can play one per day. Both Crowns have good food, including a superb clam chowder that we discovered during this period. It\u2019s Boston (white) with a non-gloppy base, equal amounts carrots, celery, and potatoes, and lots of whole and chopped clams. A cup is $3.50 and a bowl $4.50. A big batch is made every Friday and even though lots of locals come for it, the supply usually lasts a few days (ask the bartender if they have it). The chicken fingers are the best in town, and other favorites include the British pies (steak & mushroom, steak & kidney, chicken and leek), fish & chips (all-you-can-eat on Mondays), sausage roll, Scotch egg, steak sandwich, and a really good \u201cgarden grille\u201d veggie burger, all priced under $15. And, of course, drinks are free while you play.<\/p>\n\n\n\n

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Check it out when you come to town. We still go there regularly, so maybe we’ll see you there.<\/p>\n\n\n\n

Update 11\/13<\/strong><\/p>\n\n\n\n

One aspect of this that hasn’t been talked about much is the involvement of the “Professor.” Here’s some detail.<\/p>\n\n\n\n

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What many continue to misunderstand is that our goal was to hedge an existing (and constantly moving) liability, not to necessarily make positive-expectation wagers. In fact, making good bets was often impossible and we were sometimes taken to task by the Twitterverse after bets were reported. What these dissenters didn’t take into account is that getting the money down in the right proportions to complete the hedge was paramount 99% of the time. <\/p>\n\n\n\n

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Sounds easy, but it’s not. In fact, it can get extremely complicated. Frank and I were confident in the strategy and the moves we were making, but we wanted confirmation. That’s where the Professor came in. The Professor is Steve Heston, a long-time friend of ours who formerly headed the arbitrage desk at Goldman Sachs and has taught finance at Yale, Columbia, Washington University, and currently at R.H. Smith School of Business, University of Maryland. Um, yeah. If you want more, check out his Wikipedia<\/a> page. What makes Steve particularly potent in such endeavors is that he’s big-time into gambling. He’s been Frank’s go-to guy for higher math for years and contributed greatly to two of our top poker books — Kill Phil<\/a><\/em> and Kill Everyone<\/a><\/em>. <\/p>\n\n\n\n

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Steve was involved from the start, perfecting our spreadsheets and assisting with the game plan. He’s a pretty good dude to have in your back pocket and was a primary reason that we didn’t give a rat’s rear end what the Twitter observers were grousing about. Additionally, throughout the process, we referenced Steve to Mack only as the Professor, <\/em>and I can assure you that it had a lot to do with Mack’s level of confidence in us.<\/p>\n\n\n\n

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We’ve added some recent podcasts to the media list below, a couple of which go into more detail about Steve’s role in the play.<\/p>\n\n\n\n

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Update 11\/6<\/strong><\/p>\n\n\n\n

The Nationals defeated the Astros 4-3 in a wild World Series that saw the visiting team win every game — the first time that’s happened in any of the major professional sports. Frank and I have been working on tying everything together — accounting, settling positions, documenting details, etc. Hence, the long lag in blog posts here. While we continue to work these things out, following are some excerpts from the November Las Vegas Advisor<\/em> newsletter that touch on some key points. We’ll be back with more when we get things wrapped up.<\/p>\n\n\n\n

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The hedge was good.<\/em> Everyone surmised that success required the Astros to win. It was a natural assumption. After all, Mack was betting millions on the Stros. But that wasn\u2019t the case. An Astros championship would have been nice\u2014Mack was rooting for them and so were Frank and I at the end\u2014but the fact is it didn\u2019t matter financially. Our job was to hedge a multimillion-dollar liability similar to the way you would by buying insurance. If the event (Astros win World Series) happens, a lot of money is lost, so you want insurance to cover that loss. If the event doesn\u2019t happen, there is no loss, except you have to pay for the insurance. The losing bets on the Astros were the cost of that insurance. We\u2019re not divulging all the numbers at this time, but I can tell you that going into that Game 7, the hedge was fully in place. If it wasn\u2019t for Mack\u2019s passion for the Astros, I wouldn\u2019t have cared who won. <\/p>\n\n\n\n

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There\u2019s a lot involved in betting millions of dollars.<\/em> This was one of the biggest surprises\u2014betting enormous sums of money creates a lot of logistical challenges. Banks don\u2019t carry that much cash, so we had to wire funds or carry cashiers checks. And guess what? Wires and cashier\u2019s checks aren\u2019t guaranteed to clear the same day they\u2019re issued. And what about weekends? Two of the biggest betting days occurred on Sundays and if we hadn\u2019t thought ahead, we\u2019d have had no access to money to bet. Then there were the logistical problems. Earlier in this blog I wrote about a cashier\u2019s check for $100K almost flying out of my suit coat pocket. On another occasion after cashing a big ticket at the D, the bag we brought wasn\u2019t big enough to hold all the bills. I had to scoop up $10K bricks and carry them out in full sight under my arm. <\/p>\n\n\n\n

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Twitter is the new crack cocaine.<\/em> Good Lord, I didn\u2019t know I had so many friends in the media, but that was only until I didn\u2019t give one of them the first notice of a big bet. I get it. The competition to break stories is huge, but man, is it ever cutthroat. A few relationships got stretched in the process. <\/p>\n\n\n\n

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Not all sports books are created equal.<\/em> This is the big one. I learned a lot about which ones are talk and which are action. Which are trustworthy and which are snakes. Which are timid and which are bold. And it\u2019s not just the books; it\u2019s also the jurisdictions. Honestly, New Jersey and Mississippi kicked Nevada\u2019s butt overall. The biggest accepted bet was $3.5 million by DraftKings at the Scarlet Pearl in Mississippi. The second biggest was $1.5 million booked by FanDuel in New Jersey. Also accepting $1 million bets were Unibet out of NJ and William Hill. In Las Vegas, our savior was Circa Sports, which handled action at almost every turn (they booked more than $2 million total) and saved our bacon with their help in the execution of the bets. I\u2019ll hold the negatives for now, saying only that some of these books are the pure definition of \u201cweak sauce.\u201d<\/p>\n\n\n\n

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It was a hell of a ride.<\/em> The whole thing took 42 days and I\u2019m so far behind in work and personal obligations that I can hardly keep them straight, but I wouldn\u2019t trade it for anything. I remember driving into work one day and listening to a VSiN host comment that this story was unique in sports betting and something we might not see again. What a feeling to know that we were at the center of it all. I thought I\u2019d be happy to see the back of it, but honestly, I\u2019m feeling a bit melancholy that it\u2019s over.<\/p>\n\n\n\n

Update 10\/30<\/strong><\/p>\n\n\n\n

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Tonight is Game 7 and we’ve been getting bets in as best we can. Some of the books have had enough. Some didn’t have any. Hats off to Circa for sure. Thumbs down on CG Technology in particular and a couple others that make me wonder why they’re even in the business. We’ll get into these issues more after things settle down.<\/p>\n\n\n\n

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For those wondering what we’re rooting for, it’s all Astros tonight. We’ve bet a little over $1 million on them tonight at numbers that jumped all around, but we got down in the -130 to -136 range to tighten up our position. Of course, Mack is on the Astros emotionally as well as financially. Look for him tonight in his usual spot behind home plate. Check back here for the round-up, which we’ll provide in multiple posts over the next few days.<\/p>\n\n\n\n

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Go Stros!<\/p>\n\n\n\n

Update 10\/28<\/strong><\/p>\n\n\n\n

Three straight wins by the Astros in D.C. has turned the World Series on it’s head. We made bets on Houston in all three games. In Fridays Game 3, bets in NJ placed by Mack at Unibet and William Hill netted a total of $593,197 as Houston won 4-1 with Zack Grienke getting the start. Game 4 on Saturday saw Jose Urquidy pitch five innings of two-hit ball for the Stros as they ran away from the Nats 8-1. Bets at the D in Las Vegas and William Hill in Jersey returned $500,000 as the series was evened at 2-2. All of these accumulation bets pushed the hedge farther in the right direction, though we would have preferred at least one Nationals win be in the mix.<\/p>\n\n\n\n

Sunday’s game was the most interesting from a betting perspective. Our betting would take place only in NV for Game 5 and began seven hours before the first pitch. First stop was the D. Gerit Cole was a -149 favorite at the time and a bet for $298k to win $200K was made in our standard fashion of “Action” instead of listing pitchers. As pointed out two weeks ago, if you list your pitchers and one of them does not start, your bet is deemed “No Action” and you get a refund. Due to the unique nature of our situation, we determined at the onset that getting a bet voided due to an off-pitcher would be far worse a result than just rolling with the new pitching match-up. We need decisions when we bet more than anything else so Action is the way to go. <\/p>\n\n\n\n

The match-up Sunday was Gerit Cole vs Max Scherzer. After the D bet was in we headed to the Rio. They had a good line, but the maximum bet they’d take was to win $10K. We took that and headed next to the Palms where CG Technology showed a line of -145. In the time between the Rio bet and approaching the counter at the Palms, the game was taken off the board. Scherzer was getting scratched as the Nats starter and a new pitcher was being put up. We didn’t learn of this until we were at the window and were informed by the CGT writer. The new pitcher turned out to be Joe Ross. Ross had pitched primarily in August, starting five games with the Nats and winning all five while compiling a 1.05 ERA for the month — a capable replacement. The new line went up at Astros -235, an increase of 90 cents! That converts to a new implied win probability for the Astros of 70.2% vs. the previous 59.18%. We thought that was a stretch so declined to bet at the new price. As per standard rules, the two bets already made were recalculated using the opening numbers at each book, which turned out to be -235 at the D and -230 at Rio. Game 5 resulted in a 7-1 Astros win and a net win of $133,069 after the price adjustment. It wasn’t the amount that we’d planned on, but the strategy of declaring “Action” instead of “Listed” paid off. We got a decision instead of a voided bet. <\/p>\n\n\n\n

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In the three-game sweep played in Washington the Astros gave up just one run in each game, outscoring the Nats 19-3. Heading back to Houston for Game 6, the Astros are rolling and will send Justin Verlander out to try to seal the deal. Verlander has struggled in his career in the World Series. In six starts he has an 0-5 record and a 5.73 ERA. It’s a short sample for a top-flight pitcher who’s in a great spot to notch his first World Series victory in a close-out game. The Monday price was in the -170 to -175 range and we’ll be betting the Astros again. The big question still to be decided is for how much.<\/p>\n\n\n\n

As for the fun part of this saga, Mack flew in Monday night to arrange funding for a bet at Will Hill. I met him and his two pilots at the Atlantic Aviation complex on Tropicana and they wanted to go to Ellis Island for the $7.99 steak special. That’s what we did. I told them about all the great selections on the menu, but the Texans were having none of it and it was the steak special all around. Mack wouldn’t let me buy. <\/p>\n\n\n\n

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After dinner we headed back by way of the Strip at Mack’s request. It was the first time in Vegas for one of the pilots, so he got the 10-cent tour, then it was back to the plane for the flight home. Long day, but set up for today, which could mark the end of the play — or lead to a wild day of betting tomorrow for Game 7.<\/p>\n\n\n\n

Update 10\/25<\/strong><\/p>\n\n\n\n

Two games into the WS, the Nationals are up 2-0, beating both Gerrit Cole and Justin Verlander in Houston. Say what? No one here saw that coming, but we allowed for it in the wagering and welcomed it with monstrously open arms. This result flipped the numbers so we could bet whatever more was needed on the Astros at plus money, preserving the “insurance” budget for still-possible future opportunities in this series. <\/p>\n\n\n\n

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By late morning Mack had made his move in New Jersey with over 1.3M in bets split between Astros in Game 3 and Astros to win the series. Once the dust settled there we re-evaluated and decided to take two more bets in Las Vegas. Both were best-in-market wagers and both went down at the Mirage with West from Bleacher Report in tow after he spent yesterday hanging with Mack in Jersey (we like young West, a Montana St. alum). Bet #1 was on the Astros to win the World Series at +220. After betting 300K to win 660K, we followed up with a more specific bet called “Exact Result.” This bet is for the Astros to win in exactly 7 games at a price of +400. This was best-in-market as well and returns 100K. <\/p>\n\n\n\n

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Good for MGM in taking these bets, which, as we’ve expressed over and over, have positive expectation for them. We’re making these bets solely to bolster the hedge. Here’s what making a bet like this looks like, compliments of BleacherReport.com.<\/p>\n\n\n\n

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