What is expected value or EV betting?
There’s a good reason why seasoned bettors and sports betting experts alike will agree that EV is one of the most crucial factors for sports betting ROI. And, despite its importance, many sports betting fans are not that familiar with the concept. Thus, let’s look at it from its most basic point and build on that until we reach the complete picture of expected value in sports betting.
At its most basic, EV in sports betting is a means to measure the probability gap between a bettor’s expectations and a sportsbook’s. In other words, the expected value (EV) in sports betting measures what a bettor can expect to win or lose per bet placed on the same odds when this incident or process is repeated perpetually or many times, like 100 times or more.
Let’s look at the classic 50% or coin flip as an example. The expected value for a coin flip would be .5 because it can only go one way or the other on equal terms. So, here’s the scenario: one party is willing to pay a bettor $22 for a $20 bet if the coin lands on either side. So, based on the fact that the coin can go only one way or another, the bettor knows that each time they bet $20, they will get a $1 profit, which, as a little extra information, equates to a positive expected value.
How to find EV when betting at a sportsbook
The probability assigned by bookmakers through betting lines is seen by bettors as assigned to bet types like money lines, totals, spreads, and others. Using American odds as an example makes it easy to explain how sportsbooks assign probability. American odds have positive figures like +150, which you can expect to be assigned to an underdog in a specific match. If the figure is negative, like -120, it means that the team it is assigned to is the favorite. In American odds, the meaning of the actual number indicates the likelihood of winning. For example, if the number increases, whether there’s a plus or minus sign preceding it, that means the likelihood of winning decreases. If the number decreases, the likelihood of winning increases.
So, when putting this into perspective, it is more likely for an +120 underdog to win in relation to a +200 underdog. In contrast, a -120 favorite is considered more likely to win than a -200 favorite. Understanding this principle is a great start towards understanding Expected Value betting or EV betting.
Implied Probability and EV betting
Bettors can convert the line numbers provided by sportsbooks into an implied probability. Implied probability in sports betting is defined as the conversion of betting odds into a percentage taking into account the bookmaker margin to express the expected probability of an outcome occurring. For example, if a sportsbook assigns the Dolphins against the Giants a +100 line, that translates to a 50% winning probability. So, if a bettor thinks that the Giants have a higher than 50% chance of winning, this bettor will assign a specific EV or expected value, which will, in this case, be a positive expected value, or positive ev betting, which is favorable. In this case, it’s easy to see the probability gap between the punter and the sportsbook’s expectations.
Why EV Betting is a powerful tool for sports betting
So, what is more important, in-depth sports knowledge or knowledge of techniques like EV? Sportsbooks bank on the fact that their customers believe the only thing you need to be a successful sports bettor is to be an expert in sports itself, and as this gives bettors mixed results when it comes to betting outcomes, sportsbooks are still able to make their dime. It’s time to look at EV sports betting.
How sports knowledge only can let you down
If knowing your sport is not the magic key to unlocking profitable sports betting, then what is? When explaining to an amateur (or any) sports bettor that betting on a team that might not cover the spread or loses can be a more lucrative betting option, it often comes as a surprise to them.
Even with a lot of sports knowledge, it’s simply not possible to just make consistent correct guesses about the outcome of a spread to such a degree that you’ll be able to make a profit.
This is also what makes sports betting so incredibly fascinating – the fact that we can apply mathematical principles to a game of chance to accurately predict an outcome.
Ultimately, sports and matches will always be unpredictable – some more than others. Expected value is a way to remove that level of uncertainty and the element of chance that allows sportsbooks to cash in. We can even go as far as saying that someone who has a solid understanding of EV and less sports knowledge will still be more successful at sports betting than someone who knows their sports inside out but does not understand the purpose of expected value or how to use it. It takes your sports betting abilities to a whole new level.
The power of EV
Where does expected value or EV get its magical powers from? It’s a tool to help you get an objective perspective on a game’s numbers. With EV, you’ll be able to know what the worth is of a potential bet and whether it’s worth going for. If you start your journey with sports betting by applying EV from the start, you’ll have more success in your betting endeavors.
How is EV calculation done? Check out the basics below
In sports betting, the expected value (EV) measures what a player can expect to win or lose per bet and is repeatedly placed on the same odds. Positive EV (+EV) implies profit over time, while negative EV (-EV) indicates a loss over time. To be successful at betting, all bettors should aim to identify betting value every time they want to make a bet. Some bettors use an ev betting calculator, but it’s good to familiarize yourself with the formula and how it works.
If we were to explain the formula for expected value in a sentence, it would look like this:
- First, multiply the probability of winning by the amount that could be won per bet. Then, subtract the probability of losing with the amount that could be lost per bet.
Here is the formula:
- (Probability of winning) x (amount won per bet) – (Probability of losing) x (Amount lost per bet) = EV
It is important to note that sportsbooks have incredible resources available that help them estimate a line that is strategically meant to be almost impossible for a bettor to read, even when using tools like EV calculation accurately. For example, sportsbooks will use quality financial, intellectual, and human capital resources to ensure that the operator still makes a profit. For most sports bettors, it’s just an educated guess, based on what they know and have seen throughout a season.
However, that doesn’t mean that EV is now obsolete and cannot be applied. Keep in mind that you should use EV because the sportsbook also uses a mathematical formula to calculate lines that will play in their favor. And, if you think about it this way, sports knowledge just won’t cut it.
Valuable metrics you can keep at the back of your mind and apply after using more accurate tools like EV include past performance, trends, injuries, and even the weather. However, never underestimate the difference including EV in your decision-making process can make.
It’s crucial for sports bettors who want to get something back to apply critical thinking, and one of the best ways to do so is to use EV betting or EV sports betting. With that being said, sportsbooks hold between 5% and 8% profit on total money wagered from a historical perspective, which means that sports betting is a great choice if you want to win with legal gambling.
Making smart choices like applying EV can help you to make money from sports betting in the long term. Expected value betting will bring you much closer to winning and keep you much farther away from failing.
EV Betting FAQ
Expected Value betting is a betting tool applied to sports betting to help the bettor narrow down successful betting options. EV gives a new perspective to sports betting, so take a look at the article to learn more.
This is a very good question. In order to get the answer to this question, you’ll first need to understand how the principle of expected value works in betting and how it can be applied. Take a look!
There is a formula for calculating EV, which makes it easier for sports bettors to use and apply expected value and determine whether it’s positive or negative. We give you all the details in our article, so take a look.