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Sportsbooks Face Heavy NHL Futures Liability On Expansion Seattle Kraken As Bettors Hope ‘Lightning Strikes Twice’

James Murphy
by in NHL on
  • The 2021-2022 National Hockey League (NHL) season starts on Tuesday with a pair of games.
  • The expansion Seattle Kraken will play their first ever contest as they travel to Las Vegas to take on the Golden Knights at T-Mobile Arena.
  • Nevada sportsbooks are facing a big liability on the Kraken winning the Stanley Cup.

Everyone has heard the adage ‘lightning doesn’t strike twice’. Never mind that it isn’t true–lightning can and does ‘strike twice’. In the short term, lightning is *more* likely to follow the same channel it has previously used. In the long term, lightning re-strikes a location every one hundred years on average. Lightning can also strike people multiple times. Your probability of being struck by lightning in a given year is 1 in 700,000. The odds of being struck by lightning in your lifetime is 1 in 3,000. Obviously, these numbers vary from one person to another–a person that enjoys being outside during a thunderstorm has a significantly higher lifetime risk than someone that hides under their bed at the first sign of bad weather. Generally speaking, a person has a 1 in 9 million chance of being struck twice by lightning.

Now, an awkward segueway to the rainy Pacific Northwest (which doesn’t get many thunderstorms) by way of decidedly non-rainy Las Vegas, Nevada. The newest National Hockey League team–the Seattle Kraken–will play the first regular season game in franchise history on Tuesday night in the nightcap of a nationally televised doubleheader. Appropriately enough, they’ll take on the previous ‘newest team in the league’ aka the Vegas Golden Knights at T-Mobile Arena. The Golden Knights completely rewrote the record book for expansion teams in sports while transforming the perception of fans about what is possible for a team in their first season. VGK finished the regular season at the top of the Pacific Division with a record of 51-24-7. Most impressively, they shocked the world by not only reaching the playoffs but reaching the Stanley Cup Finals. They would lose to the Washington Capitals in five games but that didn’t negate the absurdity of their accomplishment.

The Vegas Golden Knights were so effective at changing the perception of expansion teams that the ‘public’ now thinks that the downright improbable is likely to happen again. In other words–they’re thinking that ‘lightning will strike twice’ in the form of a Seattle Kraken run to the Stanley Cup Finals. In this case, however, they’re willing to accept odds that are much lower than the literal chance of ‘lightning striking twice’–the Kraken are currently +3300 to win the Stanley Cup at BetOnline.ag.

A recent article in the Las Vegas Review-Journal reported that several of the city’s sportsbooks are facing a big liability should the Seattle Kraken win the Stanley Cup. The betting trajectory is similar to what the Golden Knights experienced–the Kraken opened at odds as high as 200-1 but took sufficient betting action to drop the price to a fraction of that price. Caesars Sportsbook will be out more than $1 million USD if the Kraken do the impossible and win the Stanley Cup. BetMGM is staring at a ‘mid six figure liability’. At both books, they’ve written more tickets on the Kraken than any other NHL team. MGM Resorts director of trading co-opted the ‘lightning’ metaphor to explain the dynamic:

“Everybody thinks lightning can strike twice with an expansion team.”

Caesars Sportsbook vice president of trading Craig Mucklow provides a reality check:

“The Kraken is our biggest liability, and it’s probably because of how the Knights did in their inaugural season. People think they can follow suit. But I can’t see that happening. No offense, but judging by the players the Kraken picked in the expansion draft, it’s almost like they want to tank this year. We’re happy to lay the Kraken.”

The sheer improbability of a Kraken Stanley Cup win hasn’t stopped bookmakers from limiting their liability from the start–at least relative to the Golden Knights. Vegas was as high as 500 to 1 to win the Stanley Cup in their debut season. They haven’t returned to the Stanley Cup Finals since but that performance was no fluke–Vegas has become one of the top teams in the league. As we discussed at length a few weeks ago the NHL futures board is clearly showing Vegas, Tampa Bay and Colorado in a class by themselves. In Nevada, they’re +600 co-favorites with Colorado at Caesars Sportsbook, a +750 second choice at Circa Sports, a +500 co-favorite at the Westgate Superbook. Even in their hometown, they haven’t been among the top ticket teams in the futures market–they’re fourth at BetMGM and sixth at the Westgate. Caesars’ Mucklow says that his book will do just fine if the Golden Knights hoist the Cup:

“We’re a decent winner with the Knights. If the Knights win the Cup, we’re going to be happy.”

The Westgate’s Jay Kornegay explains that pre-season futures betting is a function of value:

“They’re not really attractive at 5-1. People betting early futures are taking shots on some of the longer numbers for low risk, high reward.”

Aside from the Kraken, the New York Islanders at 20-1 are getting a lot of interest at BetMGM and the Westgate. Kornegay says that there’s simply more good teams in the Eastern Conference:

“The Islanders are getting a lot of love. There are so many good teams in the East, but in the West, there’s such a big gap between the top teams and the rest of the field.”

The Kraken have a tough enough road if they’re to win the Stanley Cup and even before the opening faceoff of the 2021-2022 season they’re facing an uphill battle: they are expected to be shorthanded against Vegas on Tuesday night as they’ve got five players in COVID protocol.

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