What Does EV Mean in Betting? – Expected Value Betting Explained

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Expected Value (EV) is one of the strongest strategies a bettor can apply when it comes to sports betting. It allows them to measure the probability difference between how they think a game or race will develop and how a sportsbook will.

In this article, we’re going to look at how EV betting works, what does EV mean in betting, how to find EV, and then how to apply it to all your bets. We’ve also included real-world examples using betting markets to show how vigorish plays a key role in spotting EV.

What is Expected Value (EV) in Sports Betting?

When we talk about EV, we’re essentially trying to find value in betting odds originally set out by online sportsbook traders. We want to find odds that seem inflated based on the probability of that result coming in.

What is EV Betting

Betting odds are all probabilities of that result happening. If a bookmaker were to set the true odds of a coin flip, then this would be a simple case of 50/50 for heads or tails. The odds would be +100 for both results and given that we know that the chances of landing on heads or tails are 50/50, this would give a neutral EV as the odds are correct.

However, if the bookmaker moved the odds to +120 this changes the implied probability to 45.5%. Given that we know for sure that this is a lower probability than the true value of a coin toss, this bet would then be +EV as we’re getting better odds than it should be.

The flip side is that, if the bookmaker were to offer odds of -120 on the coin flip, it would create a probability of 54.5%, higher than the 50% chance of heads or tails. As this isn’t the true probability of a coin toss, it would create a negative Expected Value (-EV) and in turn, not be a good price to take. When this happens, it is known as a probability gap.

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How does EV Work in Sports Betting?

The process works perfectly with sports betting as it allows us to find value from markets throughout a betting site. Unlike the coin flip, sports betting probability is subjective. Sure, it’s possible to apply a huge amount of data to create a book, but even then, there are no guarantees that the odds on offer reflect true probability.

However, just a like a coin flip, each market comes with implied probabilities as the result. Typical bookmakers create initial betting lines based on data and then adjusts based on the volume of bets placed, amongst other things.

Professional sports bettors all look for +EV bets on early betting lines. They aren’t looking at bets for games that day, but instead when the market is cold and betting lines have just been released. This is the best time to find value betting is days, sometimes weeks, before casual bettors can place their bets and distort the lines away from the correct price.

There are several key areas that need to be considered to calculate EV in sports betting.

  1. Probability of Winning – You need to evaluate how like a result is to win. This includes extensive research such as team performances, player statistics, historical data, and other relevant information.
  2. Potential Payout – The payout is determined by the odds set by the bookmaker and the amount the bettor wants to wager. Odds essentially highlight the implied probability of the result, based on the bookmaker’s data.
  3. Probability of Losing – As well as winning, it’s important to work out how likely the bet is going to lose. In a two-team bet, this would simply be the opposing probability to the bet winning, but for three or more potential outcomes, each needs to be considered.
  4. Amount Wagered – The amount wagered is needed to determine the overall profit of the bet. This can change based on how +EV the bet is but needs to be added to the formula to correctly determine if the bet offers value or not.

Complete Formula for Expected Value

All this information can be applied to the following simple formula which determines if your wager is plus or minus EV betting and thus value or not.

  • EV = (Probability of Winning * Potential Payout) – (Probability of Losing * Amount Wagered)

Once this has been applied it’s possible to work out if the bet is now +EV or -EV. +EV bets are going to yield a profit in the long term and -EV bets will yield losses, which should obviously be avoided.

It’s worth noting that even if you find a bet to +EV it does not mean it’s guaranteed to win. However, it does mean that if you keep placing +EV bets over the long term you will win more than you lose by applying that mathematical formula.

An interesting stat is that professional bettors only have around a 55% success rate when it comes to sports betting, so the margins are thin and a true price gives no certainty of a win. This means a slight profit over time, which is obviously better than breaking even or a loss over time.

Why is EV Important?

If we briefly remove ourselves from sports betting, we’re looking to find value in all walks of life. If a car is priced at $8,000 but its market value is $10,000 then this is a good deal and creates value.

Sports betting is the same, in many ways. We’re trying to find an advantage over the “field” in terms of the bets that we take. If we buy ten of the cars at $8,000 then we continue to make significant profits. If we find bets that have lower implied probabilities than the “true” odds, we will continue to make profits.

You can’t become a successful sports bettor by betting on your favorite team each week or simply placing random bets, regardless of the odds. You will lose way more often than you win.

If you continue to find bets that are +EV then you’re giving yourself the best chance to win more than you lose.

How Do I Calculate the Expected Value in Betting Odds?

We need to jump back to get the equation for how to calculate the expected value in betting odds.

  • EV = (Probability of Winning * Potential Payout) – (Probability of Losing * Amount Wagered)

This is a long-winded way of finding Expected Value, but it’s important to note how that works. Let’s look at a quick example of how this might apply to a real-world bet.

ev betting

Here we have an upcoming market and betting on the MLB game between the Seattle Mariners and the Boston Red Sox. Let’s see how BetOnline sees the moneyline bet in terms of implied probability.

Team to win Odds Implied Probability
Seattle Mariners -120 54.5%
Boston Red Sox +100 50%

BetOnline is stating that the Mariners have a 54.5% chance of winning and the Red Sox a 50% chance of winning. You’ll notice that this adds up to 104.5% and this is due to the vigorish that is charged by the bookmaker (their fee, essentially) on this market. We discuss this in greater detail in the next section.

Let’s assume that we’ve invested a lot of time into researching the game and think that the Mariners have a stronger chance of winning than BetOnline is stating. We think that this is closer to 60% and the Red Sox at 44.5% as a result to keep the same 104.5% overround figure.

If we were to set the betting odds based on these figures, it would look like this:

Team to win Odds Implied Probability
Seattle Mariners -150 60%
Boston Red Sox +125 44.5%

From these results, we can see that the odds for Seattle to win have shortened to -150. This would mean that we now need to bet $150 to make a $100 profit instead of $120 to make the same profit.

But the bet on the Red Sox win means that we now win $125 for every $100 staked instead of $100 if we were to bet with BetOnline.

It’s for this reason that the Mariners at -120 offers better Expected Value (+EV) than what we deem to be the true odds for this example.

Unfortunately, examples like this are rare, and the reality of finding +EV is very difficult. Bookmakers are incredibly sharp, and have access to huge data resources and highly complex algorithms to provide close-to-perfect odds most of the time.

It’s impossible to know for certain if a market offers +EV, but over time sharp bettors will be able to hunt out times when it’s possible to create value. This comes from knowing when the odds are short and applying algorithms/strategies of their own.

However, trying to work out Expected Value is giving bettors the best possible opportunity of beating the bookies and this is why it’s used by almost all professional bettors in some form.

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How Does VIG Play a Role When Determining EV?

Vig (vigorish) is the price you pay to play, essentially. It’s the fee charged by the bookmaker that is tied into every market and plays a huge role when determining EV.

We stated in the example above that the implied probabilities don’t add up to 100% and that is because the vig is applied to each market. The amount ranges anywhere from 3% up to 20% depending on the bet type and the betting site.

ev betting explained

For example, the betting on basketball and NBA game above between the LA Lakers and the Denver Nuggets has implied probabilities on the moneyline of 33.3% for the Lakers and 71.4% for the Nuggets. This creates a total of 104.7%, meaning that 4.7% is the profit that the betting site will take from this bet alone.

As a result, this makes it tough to find Expected Value as you’re not getting what would be considered the true odds. So, essentially you not only need to find discrepancies in the odds but also to the tune of over 4.7% one way or the other to cover the vig. Any less, and it won’t be a +EV bet.

Expected Value (EV) Betting Strategy

We’ve outlined that finding Expected Value is tough, mainly down to the juice charged by online betting sites. But we’ve included a series of betting strategies that you can apply to help find +EV bets and avoid -EV bets.

Avoid Supported Teams

It’s important that you avoid all games that you’re supported team is involved in. Finding +EV bets require a lot of dedication to apply data and stats to then oppose the betting site. Betting on your favorite team will ALWAYS have some bias which means that the chances of finding true odds are next to impossible.

The plethora of games accessible on the best online sportsbooks is vast, so there will always be another game to bet on. By avoiding games with your team, you remove any affiliation and can therefore bet with your head and not your heart.

Track Betting Lines

You need to start learning to track betting lines to see prices drift and shorten. Most of the best offshore sportsbooks will release games and lines around the same time, so you need to get in early so you can see what they are.

You’re looking for games where there is significant movement in the odds in the hours leading up to the game. This is where most recreational bettors will start to bet and when the lines are most active.

It’s not simply a case of opposing short-priced favorites that continue to shorten as the start of the game draws nearer, but there is a good chance that an underdog bet will start to offer value on lines that move a lot.

Get in Early

The best value can often be found as soon as markets are released. This is the time when sharp bettors are on the ball and have taken advantage of incorrect lines to find bets that are +EV.

Your research should be done before the market opens and at least have an idea of the probability that you would apply to each possible result. Once you’ve got this, as soon as the market goes live, you can target lines that could be +EV and take advantage.

These markets will then settle until a few hours before the start of the game when the sharp bettors are already in, and the recreational bettors start to pile on. (see tip above)

Use Multiple Betting Sites

Professional bettors might have accounts with up to a dozen betting sites. They do this so they can ensure that they get the best possible odds for the game that they want to target.

One of the biggest leaks in sports betting is users having just a single account and always taking the odds from that same betting site bet after bet, after bet. There can be as much as a 20% difference in odds from site to site and simply taking the best odds every time can be the difference between a profitable bettor and a losing bettor.

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How do you calculate EV on a bet?

What does +EV mean?

What does -EV mean?

What does EV mean in betting?

What is a good positive EV bet?

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Jonathan Askew
Sports Betting and Casino Expert
Jonathan Askew
Sports Betting and Casino Expert

Jonathan is a freelance writer working with Techopedia. He has been working within the gambling sector for over 15 years and has been fortunate enough to work with brands that include Gambling.com, CheekyPunter.com, BasketballInsiders.com and Betfair. He specializes in US and UK-based sports and casino content for Techopedia.