Multiply the rounds
A team needs four playoff wins. If its chances in each round are 65%, 55%, 50% and 50%, the title chance is 0.65 × 0.55 × 0.50 × 0.50 = 8.9%. A title contract at 9¢ is right at that estimate; one at 11¢ is about 23% above it.
| Round | Chance of winning | Running product |
|---|---|---|
| Round 1 | 65% | 65.0% |
| Round 2 | 55% | 35.8% |
| Semifinal | 50% | 17.9% |
| Final | 50% | 8.9% |
The longer the path, the smaller the number
A college basketball title takes six wins. Even a team that is 95% in its first game multiplies down to about 10% for the title, using realistic chances for later rounds. A team that must also win an opening-round game needs seven wins.
Only the next game has a live price
Later rounds depend on opponents that aren't known yet, so those chances are estimates. Use the product as a sanity check on the title price, and redo it as each round settles.
Hedging a title contract game by game
Each game is a leg, so you can hedge any one of them by buying the opponent's game-winner contract. Example: 60 title contracts at 9¢ ($5.75 with fees). Before the semifinal, 10 opponent contracts at 40¢ cover your cost if your team loses. Before the final, buying 60 of the other finalist's contracts at 46¢ locks about $21.43 either way.
Once a team reaches the final, its title contract settles exactly like its game-winner contract. In sports with no ties in the playoffs, the other team's contract is an exact opposite side.
