Understanding Expected Value (EV) To Earn Money At Sports Betting
Many of us believe that anyone who bets on sports will earn winnings on a long-term basis. However, no matter how much time and effort you put in, this is not always true.
With each game, the bookmaker has more advantage than the sport better. But is there is a way that the luck can be reversed? Is there a chance the sports bettor can gain a huge advantage? This is, in fact, possible.
Have you heard the term “advantage player”? This is a term assinged by online casinos to players whenever the bets are in their favor.
On average, the bookmakers have an advantage for straight bets at around 4.55%. Meanwhile, for the advantage players, this is a negative number. Whether you want to just earn a bit of money or you want to be a pro, the first step is to understand expected value.
If you are not familiar with this concept, read on!
Understanding Expected Value
Expected Value or EV is a term which professional gamblers utilize on a daily basis at new betting sites. To understand, let’s consider a coin toss. You bet that you will give me $1 when the coin lands on heads and I give you $1 when the coin lands on tails.
We can flip the coin for hours and neither each of us will have an advantage. This is because we have half the chance to lose and half the chance to win – it’s 50-50. There might be swings back and forth but as long as we flip the coin many times, the two of us will break even. This bet has an expected value that is neutral.
Now, let’s say I don’t like flipping the coins anymore and just want to end the game. You offer me a deal so I will stay in the game. With the new deal, I win $1.10 for each head and lose $1 for each tail. With this new deal, half a time I will win $1.10 and half the time I will lose $1. If we flip the coin a 100 times, we get an average of 50 wins ($55) and 50 losses ($50). Now the expected value of the bet is positive.
Each wager in sports betting has either a negative or positive expected value. In rare cases, there is a neutral expected value. When it comes to sports betting, the trick is finding positive expected value and avoiding the negative expected value.
You can actually caluculate expected value with the following formula:
(Amount won per bet * probability of winning) – (Amount lost per bet * probability of losing)
Let’s apply our coin toss. Amount won would be 1.10 * half the time or .5 . subtract from this the amount lost per bet 1.00 * half the time or .5.
Therefore, you should expect to make an average profit of 5 cents per dollar bet.
Calculating EV can be complicated. And the ‘probability of winning and losing’ is the most tricky part. There are lots of sites that try to help you with this, we’ll include a few here. If you learn how to consistently find ‘value bets’ you’ll be a successful player in the long run.
How to calculate, and use, Expected Value