The Fibonacci Strategy Revisited: Can You Really Make Money by Betting on Soccer Draws?

Abstract

This article investigates the strategy of betting on soccer draws using the Fibonacci sequence. In the previous literature, this strategy has been found to be both simple and profitable in both simulated and real betting markets, indicating that the soccer betting market is not even weakly efficient. First, the behavior of the Fibonacci strategy is analyzed in a simulated strongly efficient market. It is shown that the strategy is not and cannot be profitable in such a market; however, it could still be profitable in a real market under the following two conditions: first, some bets on draws have positive expected values; second, the amounts bet on such matches are high enough to more than compensate for expected losses from the other bets. This could happen if bookmakers underestimated the probability of a draw after a long string of non-drawn matches. The strategy is therefore tested on a real data set of almost 60,000 European soccer matches. Contrary to the previous findings, all tested versions of the Fibonacci betting strategy are found to lose money. The previous positive results could be explained by a very low number of trials.