The Belief in the "Hot Hand" in the NFL: Evidence from Betting Volume Data

Evidence of bettors’ belief in the “Hot Hand” -- bettors believing teams on winning streaks will continue winning -- exists in the NBA but not the NFL. Previous research assumed that book makers set point spreads to balance betting on games. Recent research shows imbalanced betting in most markets, suggesting the point spreads may not reflect behavioral biases like the “hot hand.” We find a significant increase in bets on teams on winning streaks, suggesting that belief in the “hot hand” in the NFL exists, although simple strategies of betting against teams on a winning streak does not lead to excess returns.