What is expected value in sports betting

The Essence of Expected Value in Sports Betting: A Deep Dive into the Numbers

When it comes to sports betting, there's a fundamental concept that separates the amateurs from the pros – the notion of expected value. To those deeply entrenched in the world of sports gambling, understanding expected value is nothing short of crucial for long-term success.

Expected value (EV) is a statistical concept that represents the potential outcome of a bet multiplied by the probability of that outcome occurring. In simpler terms, it's a way to measure the value of a wager by considering both the potential payout and the likelihood of that payout coming through.

For example, let's say you're betting on a football match, and the odds on a certain team winning are 2.50. By calculating the expected value, you can determine whether this bet is worth the risk. If you believe the team has a greater than 40% chance of winning (2.50 odds imply a 40% probability), then the EV of the bet is positive, indicating that over the long run, you can expect to profit from such bets.

Conversely, if the EV is negative, it suggests that the bet is statistically unfavorable, and you should avoid it to maintain a profitable betting strategy.

Why Expected Value Matters in Sports Betting

For successful sports bettors, EV serves as a guiding principle in decision-making. By consistently seeking out bets with positive expected value, bettors aim to tilt the odds in their favor and generate long-term profits.

While individual bets may result in losses, a focus on EV ensures a strategic approach that can withstand short-term fluctuations and ultimately lead to overall profitability. It's a way to navigate the complexities of sports betting by relying on statistical probabilities rather than gut feelings or emotions.

Calculating Expected Value: A Complex yet Rewarding Process

Calculating EV requires a keen understanding of probability theory and the ability to interpret betting odds effectively. It involves assessing the potential outcomes of a bet, estimating probabilities, and comparing these against the offered odds to determine whether there's value in placing that bet.

At its core, expected value embodies the essence of informed decision-making in sports betting. It encourages bettors to think critically, analyze data meticulously, and approach gambling not as a mere game of chance, but as a strategic investment.

By embracing the concept of expected value, sports bettors can elevate their game to a new level, turning what may seem like random bets into calculated risks with the potential for significant rewards.

What Is +EV Sports Betting? A Complete Guide

Is expected value a win or lose? The expected value is the prob of winning * the value you get when you win + prob of losing* value you lose (which is negative as it is a loss). The expected value in this example in negative which tells us that over time (as you play) you are expected, on average, to be at a loss at the end.

How do you find the expected value of winning? To find the expected value, E(X), or mean μ of a discrete random variable X, simply multiply each value of the random variable by its probability and add the products. The formula is given as E ( X ) = μ = ∑ x P ( x ) .

How does expected value work? By calculating expected values, investors can choose the scenario most likely to produce the outcome they seek. In statistics and probability analysis, the expected value is calculated by multiplying each of the possible outcomes by the likelihood that each outcome will occur and then summing all of those values.

How do you read expected value? The expected value of a discrete random variable X, symbolized as E(X), is often referred to as the long-term average or mean (symbolized as μ). This means that over the long term of doing an experiment over and over, you would expect this average.

What does expected value mean in a game? Expected value is a measure of what you should expect to get per game in the long run.

What is the expected financial value of a bet? Feedback: The expected financial value of a bet is the probability of winning times the net gain of winning minus the probability of losing times the net loss of losing.

What is an example of expected value in gambling? A simple example of Expected Value (EV) put into practice - if you were to bet $10 on heads in a coin toss, and you were to receive $11 every time you got it right, the EV would be 0.5.

What is expected value in matched betting? Put simply, expected value, often abbreviated to just EV in betting terms, is how much, on average, you could theoretically expect to win based on the probability of the odds at hand. This is based on statistics and considers the potential losses and profits of each choice involved in a bet.

What is an example of expected value? For example, imagine that you could buy a lottery ticket for $1 that has a 1% chance of winning $50. Buying the ticket has an expected value of minus 49 cents. This is because the 1% of $50 is only worth 50 cents, but the 99% of losing a dollar is worth minus 99 cents.

What is the expected value of a free bet? The EV (expected value) of a free bet is often referred to as free bet conversion. If you are able to make $90 in cash for every $100 free bet over the long run you would be converting at 90%. If instead you only convert $50 in cash for every $100 free bet then you would convert at 50%.

What is EV? Expected Value Explained And Why It Matters

Again, the formula calls to add the two pieces of the denominator or second half of the equation before dividing the numerator:. This is because of the vig , which is applied to virtually every wager. That seemingly small fee adds up over the long run, making it difficult for sports bettors to break even, much less profit. Instead, sportsbooks list Super Bowl coin toss bets at for both heads and tails.

Since Super Bowl coin toss bettors roughly split between heads and tails, the sportsbook will to make a profit regardless of the outcome. More traditional sports wagers work pretty much the same way. If, for example, a book gets a roughly even number of bettors that wager the favorite will cover and the favorite will not cover, it is guaranteed that the sportsbook will make money.

Of course, not every sports bet is a coin toss. Unfortunately, bettors have no sure-fire way of knowing precisely which bets have positive expected value. As mentioned earlier, books set their lines based on decades of experience and substantial financial and human capital resources. A sportsbook operator uses this vast intellectual and financial wealth to create a line that an average bettor cannot realistically replicate with nearly the same accuracy.

If a bettor wants to make money long term, they should make looking dissecting expected value a part of their process. Here are a few more tips that will help you do just that:. Lakers all received outsized attention from the media and sports fans in general. This contrarianism extends to not just teams, but sports and leagues themselves. When everyone at the sportsbook focuses on the Red Zone channel, the best value might very well be and usually is on the TV no one else is watching.

This sensation has carried over to the growing number of local sports betting markets. Most sportsbooks are owned by large, multi-national conglomerates that keep lines fairly consistent between markets, but value bettors should consider their local sportsbooks home teams when considering a bet, especially if they see value on their opponents.

Along with nationally popular franchises, bettors tend to love betting on the best teams. Underdogs cover point spreads just about as often as favorites. What is expected value in sports betting That being said, people pay far more attention to teams at the top of their league than those at the bottom, and betting dollars inherently flow toward the top because of this.

But that means that underdogs can sneak away extra value if bettors take the time to weigh their worth as the masses fawn over the heavy favorites. Though bettors should consider the values of both favorites and underdogs, more often than not, neither is worth a bet. Once again, sportsbooks have a large advantage. On an NFL Sunday, many bettors will try their luck at every game of the day.

Just like savvy shoppers may buy produce at one store and deli meats at another, sharp bettors shop around for the best lines. This is part of why sharps and the general sports betting public clamor for deep, competitive marketplaces that permit a dozen or more sportsbook licenses.

Though opening lines are still on better footing than anything an average bettor could assign, initial values have not yet been molded by the sharps and later the masses to the form of their greatest efficiency or best value. After the sharps and general public get through it, the value is usually lower than when it began.

Betting on events with positive expected value doesn't guarantee immediate success, but it increases the likelihood of turning a profit over a substantial number of bets. Consider our coin toss example again. As described above, expected value is the difference between the true odds of an event happening and the sportsbooks' posted odds.

So, in theory, identifying positive expected value bets is as simple as finding sportsbook odds that are more favorable to the bettor than the true odds. But, determining the true odds of an event and removing the "vig" from the sportsbooks odds to determine their expectations about an event happening is not so simple. This is even further complicated when calculating expected values of multi-leg parlays.

To read more about how we arrive at the true odds of an event and how we "devig" sportsbooks' odds, see How to Devig Odds - Comparing Four Methods. How you handle it is important. If you flip a coin times, it should come up heads 50 times. But sometimes it will come up 55 times.

Also track your results, and be aware of sample size. Expected value betting is an important tool for any successful sports bettor, and one that should be added to your toolbox. Look into algorithms as well, and find a method that works for you. Soon you may find yourself betting on leagues and games you never expected, and putting money into your bankroll.

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What is Expected Value in Sports Betting. Jason Ence. What is expected value. Expected value is the difference between a bettors' expectations and the sportsbook's odds. The components of expected value 1. Probability: Assessing the likelihood of an outcome Implied probability is a method used to turn betting odds into a percentage that shows what the sportsbooks believe the likelihood of an outcome is.

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