Our approach to handicapping early-season NBA action relies primarily on two independent simulation routines, a third computer prediction model as well as a modification of Jeff Sagarin's NBA power rankings. Our version of the Sagarin Power Rankings approach starts with his Predictor Rating, but then adjusts for the absence of key personnel based on 1) ESPN's Real Plus Minus statistic (calculated from the 2014-2015 season numbers), 2) estimated minutes and 3) the total number of offensive and defensive possessions expected. We may also incorporate sentiment measures such as the percentage of public wagers and line value.
Research has found that NBA betting totals tend to exhibit an upward bias over the first several games of the season. Baryla, Borghesi, Dare and Dennis (2007), for instance, recommend a strategy of betting the UNDER in each of the first four games of the season where the betting total moves down by at least a half point from open to close. These authors report a statistically significant win rate of 56.7% over the period they examined.
This study fits with two of our recommendations for opening day of the 2015-2016 NBA season, as our system highlights the following UNDER plays.
Detrot Pistons @ Atlanta Hawks u197.5 (-110)
New Orleans Pelicans @ Golden State Warriors u213.0 (-110)
While we can not point to favorable closing line value as support, each of the totals prediction factors in our model individually validate the UNDER plays prescribed above.
Separately, we are also betting the Cavaliers +4.5 @ Chicago Bulls. Even after considering the impact of Irving's and Shumpert's absences, we still conclude that at 4.5 points, the spread is a bit bloated. Per Sagarin's Power Rankings, a fully staffed Cleveland Cavaliers squad is slightly better than the Bulls (playing in Chicago). We estimate that relying on Smith and Dellavedova in extra measure in lieu of Uncle Drew and Shump shifts the spread in the Bulls favor by about 4 points (the Cavs are expected to lose about 3 points of scoring punch, and about 1 point worth of defensive prowess). The result is that there still appears to be slight value with the road dogs.
Our sim and other computer prediction work suggests the Cavs are an even more compelling value, with one system calling for an upset victory outright.