Football Betting and the Neglected-Firm Effect: A Note
To the extent that betting is analogous to investing, it seems fair to think that the football-betting market could provide a legitimate test of the neglected-firm effect. In the context of football-betting, neglect as a predictor variable appears to possess no special qualities. Even as the basis for a contrarian rule (that is, betting on teams that are least-neglected), the condition of being overlooked generated a W/B ratio (52.30 percent) that was unable to hurdle the 52.38-percent breakeven rate. Clearly, from a neglected-teams perspective, the football-betting market is efficient. A broader conclusion might be that the neglected-firm effect has little stand-alone value for investors when size is not a factor.
Kochman, Ladd M., and David L. Waples. "Football Betting and the Neglected-Firm Effect: A Note." American Business Review 16.1 (1998): 120-2. Print.