The Importance of Value in Online Betting

Types of Bets

Many rookie gamblers think the best way to make money from sports betting is to accurately predict the results of sporting events.

In a narrow sense this is true, but the fact is that nobody gets their predictions right 100% of the time. There are simply too many variables to consider. Anyone who has watched sports for long enough will have seen some completely unbelievable things occur.

Even the most successful gamblers don’t get it right every time, no matter how well they know their sports and how much they study the form.

It helps to get your bets right as often as possible, but the factor which is often overlooked is value. Value is a term which is thrown around a lot by sports bettors and it is one you should learn to get to grips with yourself.

The Hit Rate

The hit rate is quite simply the percentage of successful bets you make. If you place 10 bets and win 6 your hit rate is 60%. You hit 6 times out of 10.

A high hit rate is often seen as a successful picking strategy in betting, although this is a misconception. You can have a very high hit rate and still lose money.

If the odds on sports bets always matched the probability of an event occurring the only way to consistently win money on sports betting would be to beat probability itself. In the long run this is highly unlikely. It’s even more unlikely when you consider the fact that bookmakers typically price bets slightly below the probability line in order to ensure a profit for themselves.

Your hit rate only determines how many bets you place relative to how many you win. It doesn’t determine the quality of your bet.

Probability

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Probability is simply the likelihood or chance of an event occurring. If you roll a dice the chance of hitting a 6 is 1 in 6. The chance of hitting a 1,2,3,4 or 5 is also 1 in 6. In sports betting probability can never be precisely known, but we can make judgement calls based on form, head-to-head records and so on.

The good news is that punters are in the same boat as the bookies when it comes to judging probability. What’s more, bookies have larger number of bets to worry about than you. In

general, if they can get away with it, a bookmaker will want to offer bets at prices below the probability of an event occurring.

This is not always the case.

Recognising Good Value

Understanding good value can be daunting at first but once you’ve done it a few times it becomes a lot easier.

Imagine Everton are playing and you are offered odds of 6/4 for a victory. In this case the implied probability of an Everton victory is 40%.

This is worked out as follows:

6 divided by 4 = 1.5

1.5 plus 1 = 2.5

1 divided by 2.5 = 0.4

0.4 x 100 = 40%

If the odds of an Everton victory were 1/2 the odds would be 67%.

1 divided by 2 = 0.5

0.5 plus 1 = 1.5

1 divided by 1.5 = 0.67

0.67 x 100 = 67%

If you bet £20 on Everton at 6/4 you stand to make a return of £50. The implied probability of you winning that £50 is 40%. So four times out of ten you will win £50 and six times out of ten you will lose £20. Of course, the £50 includes your stake, so the real amount you win is actually £30.

Expected Value = (Probability of Winning x Amount Won) – (Probability of Losing x Stake)

Probability of Winning = 40% Amount Won = £30

Probability of Losing = 60%

Stake = £20

Expected Value = (40% of £30) – (60% of £20) = £12 – £12 = £0

Now you see that the value of a bet that is exactly priced at its probability of occurring is ZERO. In the long run you’d expect to make precisely nothing out of this.

Supposing, however, you believe the real chance of Everton winning is above 40%. It’s actually much higher at around 50%.

Expected value = (50% of £50) – (50% of £20) = £25 – £10 = £10

This is now a much better value proposition. To put it another way, this is a good value bet. You may win or lose in the short term, but over the long term you will expect to make money. If the odds of an Everton win are around 50% a price of 6/4 is good value.

To Conclude

From this you will now be able to calculate what a bookmakers thinks the value of a bet is. Once you have worked out your own probability for a particular event, simply compare the two.

If your value is a good amount higher, then you’ll know whether you have a good value bet or not.

Good luck and happy hunting.

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