Expected value in sports betting, or EV, is a great way to find value bets.
Read on to learn more about EV, how to calculate Expected Value and why it helps.
What Is EV?
Postive EV (+EV) implies that you would likely profit from that bet over the long-term.
Likewise, negative EV (-EV) implies that you would likely lose from that bet over the long-term.
The higher the EV, the better the value bet.
Here’s a basic example to illustrate.
Example Of EV
The easiest way to picture EV is with a coin flip.
Imagine you were to bet on the outcome of the coin flip.
Now, let’s say that you were offered odds of +110 for the coin to land on heads or tails.
This gives you +0.5 EV on each bet, meaning you could to win $50 from every $100 wager.
Why Expected Value Is Important
Beginners to sports betting often think they should only bet on winners.
They will look at the matchups, decide who they think will win/cover and bet accordingly.
This is not a profitable way to bet.
Sometimes you must bet on the team that is expected to lose or not cover the spread.
Not many people can actually predict the winners accurately enough that it becomes profitable.
This is how sportsbooks make most of their money.
Recreational bettors have the impression they can beat the bookies with their sports knowledge.
If this was the case, anyone that watched enough sports could easily make a fortune.
Sports are unpredictable…
…but Expected Value is not.
Here’s the deal:
EV is purely based on numbers.
It shows how much value is in the bet.
+EV bets are usually good value; -EV bets are usually poor value.
Further, EV helps to sift through things you already know.
Pay attention to EV and you will have a much bettor chance of profiting from sports betting than if you don’t.
How To Calculate Expected Value In Sports Betting
It’s quite simple to calculate Expected Value in sports betting:
Multiply the probability of winning by the amount you will win from the bet.
Then, subtract the probability of losing multiplied by the amount you would lose.
Here’s what it looks like in action:
Follow these steps to fill in the above formula to calculate the EV for your bets:
- Translate the odds into Decimal Odds using our Odds Converter.
- Calculate the Amount to Win from a winning bet and its Probability of Winning.
- Calculate the Amount to Lose from a losing bet and its Probability of Losing.
- Enter this into the formula.
Here’s an example.
Example Of How To Calculate EV In Sports Betting
Let’s say you were to bet on the following NHL game.
Now, let’s say you were to bet on the Capitals but wanted to check if it was a +EV play.
Using the steps above:
The American Odds for the Capitals to win can be translated to:
Likewise, the American Odds for the Golden Knights to win can be translated to:
Calculate the Amount to Win from a bet on the Capitals to win:
Amount to Win = (Stake * Decimal Odds) – Stake
For a $100 bet:
Amount to Win = ($100 * 2.15) – $100 = $115
Now, calculate the probability of this bet winning:
Probability of Winning = (1 / Capitals Decimal Odds) * 100%
So, for a winning bet on the Capitals:
Probability of Winning = (1 / 2.15) * 100% = 46.51%
Calculate the Amount to Lose from a bet on the Capitals to win.
This is simply your stake.
So, for a $100 bet
Amount to Lose = $100
Now, calculate the probability of the bet losing:
Probability of Losing = (1 / Golden Knights Decimal Odds) * 100%
So, for a losing bet on the Capitals:
Probability of Losing = (1 / 1.74) * 100% = 57.47%
Enter the results into the formula:
EV = (Probability of Winning * Amount to Win) – (Probability of Losing * Amount to Lose)
So, for a bet on the Capitals:
EV = (46.51% * $115) – (57.47% * $100) = $53.49 – $57.47 = -$3.98
Therefore, the EV on this bet is negative.
It suggests that you will lose an average of $3.98 for every $100 staked.
How Does EV Help With Sports Betting?
It’s important to note that negative EV bets don’t always mean you will lose over the long-term – it’s just a lot more likely.
Sports betting odds are subjective
If you calculate the probability of an outcome that is different from the implied probability of the odds, you could find some positive EV here.
For example, the odds in the previous example suggested that the Capitals have a 46.51% chance of winning.
However, if you used your own system, such as a Poisson distribution, and calculate that the Capitals have a 51% chance of winning, the EV jumps from -$3.98 to $1.18.
Calculating EV also gives you more information about the value from your sportsbook as low-margin books tend to have lower EVs.
Finding Value Bets
Find a spot where the books may be slightly off, calculate the EV and see how much value there is in that bet.
Note that there are a few things to keep in mind when searching for value bets.
+EV Bets Don’t Guarantee Wins
The bet still has to win for you to make money.
EV only illustrates if there is good value in the bet.
-EV Bets Don’t Lose Every Time
While the bet may not be expected to win over the long-term, upsets do happen.
In fact, some wagers on heavy favorites can be -EV.
The -EV simply means that there is bad value, not that the heavy favorite will lose.
You Can Still Find Value In Low Odds
Low odds only show that you won’t make a large profit from a bet.
This does not mean because they are low, they are always -EV.
For example, if the odds are +115 but they should be closer to +110, there is still value there.
Expected Value is a tool that will help you decide whether to make a bet or not based on making that bet over the long run.
It does not tell you whether the bet will win.
Now over to you.
Do you often use EV when making your bets?
Comment below or let us know on Twitter.