Abstract
This study investigates, in a conceptual way, the intrinsic valuation of sports futures wagers and, given the absence of a viable secondary market, strategies for locking in pre-expiration value by hedging with the existing set of futures wagers, proposition wagers, and game wagers. An interesting finding is that effective hedging with game wagers generally involves games of teams other than the futures team, in addition to the futures-team’s games. The paper also shows how to use current game odds and futures odds to find the implicit projected odds on future games, conditional on the match-ups to be determined by the outcomes of current games.
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