The Evolution of Oddsmaking Algorithms

The history of oddsmaking algorithms represents a transition from **subjective handicapping** to **automated quantitative trading**. * **1940s–1980s:** Relied on the **"Linemaker"** (e.g., Bob Martin) using manual power ratings to balance the book against public perception. * **1980s–1990s:** The **Computer Group** introduced regression analysis, forcing bookmakers to adopt statistical methods like **Poisson distributions** and **Elo ratings**. * **2000s:** The internet era shifted focus to **Global Liquidity**, where betting exchanges and high-limit books (Pinnacle) used market forces for efficient price discovery. * **Present:** The industry relies on **Machine Learning** and **Copula functions** to price complex derivatives (Same Game Parlays) and real-time micro-bets, with data feeds automating the entire lifecycle of the line.