Are you wondering what is Expected Value and how to calculate EV before you place a bet? You are at the right place!
When it comes to betting it goes without saying that you want to find the very best value odds before placing a wager.
It’s why we bet in the first place. We want the biggest payouts and the best way to do that is finding the bets that have the best chance of winning for the best possible price.
At Gambler Saloon we’re always looking for good value betting and have become experts at finding appealing odds, whether it be football, soccer or horse racing. We’ve become experts at picking out wagers with good Expected Value and what’s more we can help you too.
Below you’ll find all you need to know about Expected Value including what it is and how to calculate it.
What Is Expected Value?
Expected Value is essentially a method of measurement that informs you of how likely you are to win or lose within a market.
Known commonly as EV, the metric measures your likelihood of winning over time so if your EV has a ‘+’ beside it, then the Expected Value suggests there is profit to be had over time. If the EV has a ‘-‘ beside it then that implies the complete opposite.
It’s an incredibly useful method to use and is becoming increasingly popular with bettors as they look to increase efficiency when betting.
Calculating EV can appear complicated, but it really doesn’t need to be and once you’ve learned how it works it’s generally straight forward.
Keep reading and you’ll find how Expected Value is calculated alongside a simple example for you to get a firm understanding of the method.
How To Calculate Expected Value
You can use a relatively straight forward formula to calculate Expected Value that can be used no matter what the sport or market you’re betting on.
The formula is as follows:
(Amount Won per Bet x Probability of Winning) – (Amount Lost per Bet x Probability of Losing)
All you’re required to do is use the odds to place probabilities and winnings/losses into the formula and you’ll receive the Expected Value as a positive or negative.
Perhaps the best way to explain how to calculate Expected Value is via a roulette wheel and the basic outside bets such as Odds & Evens or Red or Black.
In this instance, let’s take the latter. The odds on the ball landing on red has around a 50% chance of winning and likewise the black.
Let’s say you want to place $10 on Red. The formula would look as follows…
(10 x 0.5) – (10 x 0.5)
This would give you an Expected Value of 0, A’s ultimately there’s a 50% chance of winning every time.
However, if we were to shift the odds slightly with a Red now having a probability of 0.48 with a payout of $11, that would see the EV change and provide value.
The formula would shift to this…
(11 x 0.5) – (10 x 0.5)
This will see an Estimated Value if $0.50 on Red as the odds on that outcome is now better than the actual odds of the event.
Finding that value can be a little hard to come by, just as the likes of Arbing are but if you do come across Value odds like this they’re well worth taking advantage of.
Why You Should Use Expected Value
The bonuses of finding value bets is relatively obvious – they guarantee to make you profit in the long term.
However, Bookmakers of course try to have the edge in their favour so you do have to search hard for the markets where the odds fall in your favour.
Of course, you should also take note of your own judgements when deciding upon value as predicting results in sport is all subjective and can change as variables change within a build up or during a fixture.
There’s no reason why you can’t insert your own probability reading into the formula if you genuinely believe those particular chances of the outcomes.
Where To Find Good Value Bets
You can find value with many different bookmakers and betting exchanges often having different opinions on where you feel probabilities lie.
It’s worth shopping around all the biggest bookmakers to find the best value for you while you’ll also find the best value across the more niche markets.
The likes of PlaySugarHouse, Caesars and 888sport are always good bookmakers to look for value as they have large markets across most major sports.
You can find value in any sport, with the likes of soccer, horse racing, NFL, NBA, Tennis, Baseball and hockey all popular with punters, particularly during major tournaments.