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Tiger, Tiger – should these bets have been burning bright?

April proved quite a month for not one but two sporting Tigers who had set out to confound history in their respective fields – and it was not a bad month either for those who chose to back them at the bookies

02/05/2019

Juan Torres Rodriguez

Juan Torres Rodriguez

Research Analyst, Equity Value

April proved quite a month for not one but two sporting Tigers who had set out to confound history in their respective fields.

At Aintree on 6 April, strong favourite Tiger Roll became the first horse to win back-to-back Grand Nationals since Red Rum in 1973/74 while, at Augusta (Georgia) eight days later, the rather less fancied Tiger Woods won his 15th golfing major – the 2019 Masters – almost 11 years after he had won his 14th.

As Tiger Roll stormed home – the shortest-priced horse to win the race in exactly 100 years – we breathed a small sigh of relief, here on The Value Perspective. A few weeks earlier, looking to illustrate the importance of keeping on the right side of the averages and the risks of betting against history, we had focused on the chances of Native River achieving the rare feat of winning the Cheltenham Gold Cup two years in a row.

Kindly not hurting our argument, the horse came in fourth but, as Tiger Roll went on to show, sometimes history is indeed confounded.

The future is unpredictable and shocks do happen – in the context of sport, it is not absolutely impossible for 5,000-to-1 outsiders to win the English Premier league, as Leicester City did in 2015/16, or for former golf champions to reach heights most had thought were now well beyond them.

Discussing the lucky souls who bet on Leicester that season in City haul, we observed: “Successful 5,000-to-1 bets make both great headlines and dreadful behavioural finance case-studies in waiting – and for precisely the same reason. Their rarity value.”

So we were particularly interested to read the thoughts of one gambler, who won some $1.2m (£930,000) betting Tiger Woods would finally claim his 15th major at the Masters.

'Tips' from a winner...

According to this Golfdigest article, the lucky punter is James Adducci, a 39-year-old self-employed day-trader, who had a mortgage on his house, two student loans and two car loans but decided he would take $85,000 – which he says was “everything I had that I could afford to lose” – and place it on Woods. His reasoning? “I just thought it was predestined for him to win.”

Expanding on his thinking, Adducci tells the magazine: “I had been thinking a lot about this. I watched Tiger’s performance at the Tour Championship, and things seemed to be going his way. I looked at how well he did there, and some other factors you can’t put stats behind. It wasn’t about the stats for me. The fact that this was going to be his first major in front of his kids – I was convinced he would win.”

As keen students of behavioural finance, here on The Value Perspective, what the self-employed day-trader claims was his first-ever sports bet in his life makes for a fascinating case study – the way he believes the result was predestined, his casual dismissal of statistics, the narrative of Tiger playing in front of his children – but perhaps the most important lesson here is that these are the stories that make all the headlines.

Yet all the gamblers who had ‘a hunch’ or ‘a good feeling’ or whatever ahead of Augusta about Rory McIlroy and Francesco Molinari, Dustin Johnson and Brooks Koepka and all the rest of the field … we do not get to read about them or indeed very many other punters through the ages.

There is, after all, a very good reason almost anyone can name more successful bookmakers than they can successful gamblers.

In the meantime, Adducci says he and his wife are now “eyeing up new garage doors” and then they plan to use the rest of his winnings to pay off most of their debt. “I’m a responsible guy,” he tells Golfdigest. “My background is finance. I’m going to invest most of it. And we’re going to grow it.”

Author

Juan Torres Rodriguez

Juan Torres Rodriguez

Research Analyst, Equity Value

I joined Schroders in January 2017 as a member of the Global Value Investment team. Prior to joining Schroders I worked for the Global Emerging Markets value and income funds at Pictet Asset Management with responsibility over different sectors, among those Consumer, Telecoms and Utilities. Before joining Pictet I was a member of the Customs Solution Group at HOLT Credit Suisse.  

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