EV betting is one of the more complicated topics when it comes to sports wagering. EV stands for expected value and is a measurement of the expected win or loss for each wager made. Positive expected value (+EV) suggests a bettor increase their likelihood of being profitable over time, whereas a negative expected value (-EV) suggests a greater chance of a loss over time. Ideally, you will want to make many more positive EV wagers than negative EV (or neutral EV), which will greatly increase your long-term profitability. If you as a bettor can consistently make +EV wagers, you can expect to be profitable long-term.
All of that said, figuring out expected value is straightforward (we will be working with American odds unless otherwise noted). The formula for expected value is as follows: (Potential Win x Implied Probability of Winning) - (Potential Loss x Implied Probability of Losing). Implied probability for positive odds is calculated as follows: 100 / (100 + odds). Implied probability for negative odds is calculated as (-1 x odds) / ((-1 x odds) + 100). For example, to calculate the implied probability of a +150 line, we would do 100 / (100 + 150), which equates to 0.40 or 40.0%. The implied probability of a -130 line is calculated as (-1 x -130) / ((-1 x -130) + 100), which equates to 0.565 or 56.5%.
As an aside, you will quite often see -110 lines on both sides for spreads and totals, among other markets. The implied probability of a -110 line is (-1 x -110) / ((-1 x -110) + 100, which equates to 0.524 or 52.4%. If you add the implied probabilities of two -110 lines you get 104.8%. The 4.8% above 100% in this example is the edge the sportsbooks give themselves to guarantee a profit (assuming they get close to equal action on both sides), what we have previously mentioned as the vigorish, or vig. In the case of -110 lines on both sides, the bettor can expect to lose an average of $4.80 for every $100 staked over a large number of wagers.
Finding +EV wagers can be challenging and time-consuming. You must be able to quickly identify market inefficiencies, calculate implied probabilities and use your own or others' models to determine if the line you're examining is +EV or not. Our Positive EV scanner does most of this work for you. We search for the latest +EV lines for all available sports and aggregate them based on the perceived edge from the fair value, expressed as a percentage. Simply head to the Positive EV scanner page and filter the options as you need based on the sport, game type and more. From there, expand a selection to see the detail, including the market, book, wager, current odds and the full +EV breakdown. The breakdown shows what the fair value odds should be, along with the EV probability, implied odds probability and probability edge, expressed as a percentage.
If you want to bet on this line, using the Kelly System Calculator linked to from each selection will tell you exactly how much to wager. This calculator uses the current odds, probability edge, even value probability and your bankroll, along with a Kelly amount that you set, to calculate exactly how much you should wager on this line. For example, I have identified a +EV line from our Positive EV scanner with a probability edge of +1.39%, even value probability of 12.5 and odds of +800. These variables are loaded automatically when I click on the calculator icon and navigate to the Kelly tab. I simply need to enter my bank roll and my preferred Kelly amount (in this case, $10,000 and ½ Kelly), and the calculator tells me I should bet $78.13 on this wager, which is 0.78% of my bank roll.
To sum it all up, expected value is a measure of what a bettor can expect to win or lose over a significant amount of time. A +EV bet is one in which the odds for a given wager are favorable for the better when compared to the fair value of the line. Fair value can be calculated in several different ways; our Positive EV scanner uses our proprietary method by calculating the fair odds across numerous sportsbooks' lines and incorporating our models. As betting odds are not an exact predictor of the outcome of a sporting event, we can use the Positive EV scanner to identify and place wagers on events where our EV model shows the sportsbook(s) odds may be wrong and we as the bettor have the edge.
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To calculate the EV of a line, we need to take the implied probability of the line we want to bet on, multiply that by the potential win amount, then subtract the implied probability of losing multiplied by our potential loss. Let's look at a basic example of calculating EV, a point spread with -110 on both sides (the spread itself is irrelevant for the calculation). Remember, the formula for expected value is (Potential Win x Implied Probability of Winning) - (Potential Loss x Implied Probability of Losing). We plan to bet $100 on this spread. Our potential win is $90.91, and our potential loss is our original $100 stake. Our EV is then calculated as ($90.91 x 0.524) - ($100 x 0.524) = -$4.74. This means, we can expect to lose on average $2.37 per $100 wagered, were we to make this bet over a large sample size (many, many thousands of times). The EV on this bet is negative - the sportsbook has set the lines such that they have the edge.
Alternatively, what does positive EV look like? Let's say, hypothetically, that one of these lines is actually +120 while the other is -110. In this case, using our same $100 wager, our potential win is $120, and our potential loss is still $100. The implied probability of the +120 line is 100 / (100 + 120) = 0.455. Our EV calculation is ($120 x .0455) - ($100 x 0.524) = $2.15. The EV of this bet is positive; were we to make this bet over and over many times, we can expect to win on average $2.15 every time we make this bet.
You won't win every +EV bet that you place (and lots of negative EV bets win). But by making many +EV wagers, over time we will give ourselves a better chance to be profitable. Remember, sportsbooks have the edge just by setting the lines and applying vig. Using the tools at your disposal here on SB Intel can help you become a long-term profitable sports bettor.