Betting strategy “Value betting”
Value betting is a math betting strategy on undervalued events, the coefficients of which are overpriced relative to their probability, based on statistical data (sometimes other criteria). For example, some team wins one of the three times, in this case, the coefficient on a win of 3.30 to 1 gives a positive expectation, because in 3 games putting you $ 3, will get a 3.3. Of course, this is in theory, because based on the statistics, you do not consider who a team plays, its position in the League, the players ‘ form, injuries and sometimes other important factors.
Value betting. Theory
So, from the point of view of mathematics, for success, You should bet, the mathematical expectation of which is greater than zero. What is the mathematical expectation of the bet? This is the average gain (or loss) per bet, which you get if you for a very long time to do the same bet on identical events.
Suppose you bet on any single number on a standard European roulette (with one zero). Each time you bet 1 dollar. After a very large number of bets you will get approximately the following picture: you’ll win on average one bet of 37, receiving the prize in amount of $ 35, and 36 losing bets from 37, losing on each $ 1. Thus, every 37 bets you will lose on average $ 1 or at dollar 1/37 (about 2.7 cents) on every bet.
So we see that in roulette the mathematical expectation of the bet is negative, so in the long run this game will be a loss for the player (and thus profitable for the casino).
To calculate the mathematical expectation of the bet by the following formula:
MO = V * P(V) — L * P(L)
The variables in the formula mean the following:
MO — expectation;
V — possible win;
P(V) is the probability of winning;
L — possible loss, i.e. the amount of Your bet;
P(L) is the probability of losing.
Given that the probability of winning and the probability of losing the sum should give the unit (P(V) + P(L) = 1), this formula can be represented like this:
MO = V * P(V) – L * (1 – P(V))
In sports betting, unlike roulette, it is possible to make bets with a positive expectation. Suppose a bookie takes bets on a game between teams A and B. the Coefficient on the victory of the team And is 1,40 (i.e., at a rate of 1 dollar Your possible win is 40 cents), on the winning team, In — 7,50 (possible win — 6.5 dollars) for a draw at 4.00 (possible win — $ 3). you have conducted our own analysis of the upcoming game and came to the conclusion that the probability of winning teams And is 60% (or 0.6), the probability of winning team — 10% (0,1), the probability of a tie is 30% (0.3 mm).
We calculate the mathematical expectation of all three possible bets (bet 1$):
MO(A) = 0,4 * 0,6 – 1 * (1 – 0,6) = 0,24 – 0,4 = – 0,16
MO(B) = 6,5 * 0,1 – 1 * (1 – 0,1) = 0,65 – 0,9 = – 0,25
MO(x) = 3 * 0,3 – 1 * (1 – 0,3) = 0,9 – 0,7 = 0,2
Thus, of the three possible bets one-namely, the bet on a tie will have a positive expectation of 20 cents.
There is an easier way to determine whether to bet on a particular outcome. To do this, divide 100 by the implied probability ( % ) of the corresponding outcome. You received number is the ratio at which Your bet has zero expectation. In order for the bet to be profitable, the ratio must be greater than this number.
So, in the above example we bet on the team And will be profitable at odds of 1.67 more (100 / 60) the rate for a team — at odds of more than 10 (100 / 10), bet on a draw at odds of more of 3.33 (100 / 30).
Please note, underrated event is unlikely to be the most likely. In the above example most likely will be the victory of team A, however, due to the too low ratio a bet on this outcome will be unprofitable. In General, the odds on the favorites are usually underestimated. This is because too many players prefer to bet on favorites, considering these rates are “win-win”. Bookmakers, in response reduce the odds on the most popular outcomes.
For this reason, most betting on favorites usually makes unprofitable in the long-term interest rates. It is easy to calculate that when the coefficient on the victory of the favourite is 1.1 (which is quite common), the probability of victory should be more than 91% (100 / 1,1), so this bet had positive expectation. Sporting events where the favorite actually has such a high chance to win, as you know, are very rare.
Value betting. Insights
To summarize, we list the conditions necessary to have Your “value betting” was successful:
1. You need to find groups of events where opportunities arise to “value betting”. For example, this can be a sport where constantly a lot of games like Tennis and bookie no time to think, but You’ll be hard to work out all the matches. It is possible to use a “value betting” in live-betting, where a goal in the first minute can dramatically change the odds on the total, although this goal may well be the last. I advise you to not search among the most hyped markets, because the more there willing to capitalize on “value betting”, the less differences of ratios from statistics, and earning potential disappear.
2. you must be friends with mathematics and at least “Excel” to collect data and to calculate probabilities for different outcomes. The error in the calculations will lead to incorrect calculation of the mathematical expectation of the bet, and as a consequence the whole point of this strategy is lost.
3. Use the conservative strategy of capital management. Remember that bets on undervalued events bring profit in the long run, that does not rule out the possibility of periodic “black bars”. Even casinos that have a guaranteed advantage over the player, from time to time there losing days. Your money management strategy should allow You to experience those “black bars”. Remember, martingale and other aggressive management strategies capital — a direct path to financial suicide.
4. Search for bookmakers offering the best odds for the respective outcomes, as the value of the coefficient directly affects the mathematical expectation of the bet. However, consider reliability, rates “anywhere” then do not always pay.
Suggest reading: the 8 principles of a successful player, How to win in sports betting and earn 21 tips for betting on football, 5 mistakes of a beginner, Where do sports betting
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