Betting Smart Using Expected value

Prop bettors look for bets with a positive expected value. But what is EV and how can we use it to make better bets?
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In our video series we covered how betting with a bookie works, and what you need to know before placing your first bet. Now, let’s take it one step further and let’s look at the bet outcomes and how you can better predict whether your bet is a good one or not.

There is a formula to understand the monetary outcome of a winning bet. Expected value, or EV for short, is a calculation of how profitable you might be.

Before we jump into the details about EV, here is a quick reminder of the types of bets that are typically offered at a sportsbook and the corresponding odds.

  • Moneyline: Simply pick one side of a winner, each represented by one set of odds
  • Point spread: Points are assigned to both teams. They must either win by a certain amount or lose by less than that amount. Bengals -7 means they must win and win by more than 7. Bucs +7 means they can win outright or lose by less than 7
  • Over/Under: Total points of both teams combined, pick over the amount or under
  • Prop Bet: Specific bet inside the game like how many points a player will score
  • Future Bet: Predicting Super Bowl winner, MVP winner of a future outcome
  • Parlay: Combining different outcomes of all different bets for better odds
  • Teaser: Receiving a point decrease on a spread or total and combining them

Once inside a sportsbook – whether online or in person – you’ll see these bets with a corresponding plus or minus. +110 means risking $100 to win $110. -100 means risking $110 to win $100. The difference is the juice or the hold which is how sportsbooks make their money.

Let the numbers decide whether the bet is worth it

When you are trying to be profitable in sports gambling, the break-even point is not 50% as you might expect. The break-even number is actually 52% because the sportsbooks take juice.

For a standard bet, here is one way to get to the 52%:

Standard –110 sports bet = $110 ÷ $210 = 52.41%

Knowing this, we can use the expected value calculation to see how close a bet is to 52% in order to decide whether the bet is worth taking.

The formula to calculate EV is as follows:

Expectation = (Chance of Winning × Amount Won) + (Chance of Losing × Amount Risked)

Remember, a -110 bet is 52% so if you are taking a bet that has higher odds, you are just trying to get close to that number.

The break-even percentage on a +200 bet is simply the amount risked divided by the amount returned including the initial stake. $1 ÷ $3, or 33%. Our expected winning percentage (35%) is higher than the break-even percentage (33%), making this a good bet.

So you should start with the betting odds, figure out your break-even point and then go from there. Finding positive EV bets and cashing on them is how professional handicappers make their money. When a spread is -3 and you think that team is going to win by 5, you’ve just found a positive EV bet. If that line were to suddenly change, so should the EV.

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