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

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Written by Dan Fitch

Updated: 04:15 am EST, 09/07/2024

EV is an abbreviation of the sports betting term ‘expected value’. It refers to the difference between the true probability of a betting outcome winning and the odds on offer from a sportsbook. We’re going to fully explore the question of what does EV mean in betting, explaining everything that you need to know about the topic.

What Does EV Mean in Sports Betting & How Does It Work?

expected value oddsExpected value in sports betting is arguably the key concept for bettors to consider when looking to find value.

Odds are calculated based on the probability of a certain result occurring. If a bettor believes that the probability is greater than what has been estimated by the sportsbook and the odds are therefore too high, then they will have identified a value bet.

Calculating the probability of a certain result occurring is not an exact science for either the bettor or the oddsmakers, with both using their experience, instincts and research to come to their conclusions.

We will therefore illustrate how expected value sports betting works with an example where the true probability of the possible outcomes, cannot be disputed. A coin flip.

There are two sides to a coin. One is head and one is tails. When you toss a coin, there is an equal chance of either head or tails landing face up. The probability for either outcome is 50%, which translates to betting odds of +100 for both heads and tails.

Now, imagine if a sportsbook gave odds of +120 for heads to be the winning outcome. The implied probability of these odds is 45.5%. That is a lower probability than we know to be truly the case. This bet could therefore be described as +EV, as the odds are bigger than they really should be.

If the sportsbook gave odds of -120 for tails to win, it would imply a probability of 54.5% on that outcome being successful. We know that this is higher than is truly the case and that the odds are too low. This is an example of -EV.

The difference between implied probability and the true probability is known as the probability gap.

EV Betting Calculator & Formula

There is a formula which can be used to calculate EV.

This formula will show when a bet is +EV or -EV, which are concepts which we will further explore over the next two sections. Put simply, backing +EV should yield profit in the long-term, while backing -EV will bring losses.

This is different from what does plus and minus mean in betting, as that relates to an odds format.

Let’s show you an example which will break down the process of calculating EV. In this example the oddsmakers have priced up a baseball game as follows.

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

The Mariners have a 54.5% of winning based on these odds, with the Red Sox having 50%. This adds up to 104.5%, with the extra 4.5% being the vig charged by the sportsbook (which is their fee and will be explained in depth later on).

Yet let’s say that based on the 104.5% market, our research tells us the odds should look more like this.

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

At the sportsbook’s odds we would have to bet $120 on the Mariners to win $100, while at our estimated odds we would need to bet $150 to win $100.

Therefore, the available odds of -120 offer much better value than the -150 that we consider to be the true odds and are an example of +EV.

Using an EV calculator betting app or having a foundational knowledge of what arbitrage betting is can be useful in finding such instances. In particular, you can use a betting calculator to show you the implied probability of the odds.

What is Positive EV Betting?

Positive EV sports betting is where the odds are bigger than they really should be, based on the true probability of the outcome being successful.

So with our early example, the true probability of heads winning a coin flip is 50%, for which the odds should be +100. If you were to see a price of +120, the implied probability is only 45.5%.

The probability gap represents the extra value that you are getting with +EV betting. The odds are larger than they should be, so you are gaining extra value when you make such a bet, whether it’s on baseball run lines or moneylines in football.

With our example we have chosen a type of bet where we know the exact percentage probability of the two outcomes on offer. The numbers are not in doubt.

A coin flip is just about the only instance in sports betting where you can really say that. Generally, finding a case of positive EV is based on your opinion differing to the opinion of the oddsmakers.

So if your insight leads you to believe that a betting outcome has a 60% chance of being successful, but the oddsmakers’ prices suggest it’s 40%, you will believe that you have found an instance of positive EV.

Yet no matter how strongly you might believe that, it’s not necessarily true. The oddsmakers’ opinion may be the more accurate evaluation. That’s essentially the definition of gambling.

You wager on your knowledge and bet against the spread or most likely outcome of the oddsmakers. The most successful bettors are able to find a way of regularly identifying plus EV betting situations, where the oddsmakers have got it wrong.

What Does Negative EV Mean in Betting?

Negative expected value is the opposite to positive EV. It is when the odds are smaller than they really should be, based on the true probability of the outcome being successful.

So returning to our coin flip example, we know that the true probability of tails winning the toss is 50%. Odds of -120 would suggest that the probability is actually 54.5%.

We know that this isn’t the case, so the odds on offer are too short. It’s an example of poor value, with the probability gap between the true chance and the implied chance, creating an instance of -EV.

With +EV the benefits are obvious. The odds are bigger than they really should be, so it makes sense to place a bet on that selection, to take advantage of the extra value that is on offer.

It is not quite so straightforward with -EV, but being able to identify such instances is another key to becoming successful at sports betting.

You might want to bet on a selection and think that it will be a winner. Yet if you also believe that the odds are too short, the right thing to do is to ignore that bet.

Far from offering value, a -EV bet is doing the opposite. The price is not as big as it should be. It’s offering poor value against your stake.

If however, you can spot an instance of negative EV, it can suggest that there is an opportunity. If one betting selection is too short, the other selection(s) will be bigger than they should be. You might then be able to find a +EV opportunity, with some extra value to enjoy.

Expected Value Betting in Different Wagers

When exploring what does EV mean in betting, it makes sense to look at the different type of bets where you might experience this phenomenon. Let’s take a look at some of the types of wagers where you will find such opportunities.

MoneylineSpreadsTotals

If you click on an event, the first market that you’re likely to see is the moneyline. This is a type of market where you are simply betting on the result of the event, such as a fight at the top boxing sportsbooks online. If there are only two possible outcomes then the benefits of finding an EV opportunity are likely to be greater than if there are three, such as when a tie is a possibility.

With spreads the team that is the favorite are given a points disadvantage that they must overcome. The underdog is given a points advantage, whereby they must not lose by a greater total than that number. With spreads and EV, you are not only looking at whether the odds represent value, but also whether the spread totals themselves are correct and how they relate to the odds

Totals markets allow you to bet on the total figure of a certain statistical element of a sporting contest. So in a football game you can bet on the total number of points or touchdowns, while in a soccer match you can bet on the total number of corners or cards. Normally a certain figure is stated and you have to bet on whether the total will be over or under that amount. Finding EV opportunities with this type of market sees you having to assess both the total figures and the odds

The Role Vig Plays in Expected Value Sports Betting

When we gave our coin flip example to demonstrate what does EV mean in betting, we used odds that perfectly aligned to the probability of the two possible results. Both heads and tails had a 50% chance of winning, adding up to a 100% market.

When you use an online sportsbook, you’ll find that the odds will always add up to a figure that is greater than 100%. This is because the sportsbook will effectively charge a price to you and everyone that bets on the market.

The price is the vig, which is short for vigorish. Oddsmakers will add the vig to every market, with the amount varying from anywhere between 3% and 20%, depending on the sportsbook and the market in question.

In terms of finding expected value opportunities, it’s generally fair to say that the smaller the vig, the better the opportunity.

Say that the Los Angeles Lakers are priced at +200, against the Denver Nuggets at -250 on the moneyline. Based on those odds, the implied probability of a Nuggets win is 71.4%, with the Lakers at 33.3%, which adds up to a total of 104.7%.

The 4.7% is the profit that the sportsbook are taking from the bet. That means to find a true +EV wager, the discrepancy between the implied probability and the true probability, has to be greater than 4.7%.

Positive EV Betting Strategy

Let’s take a look at some positive expected value betting strategies, that will improve your profitability.

Do Your Homework

Finding examples of EV requires you to be able to calculate the probability of a bet being successful, in order to compare with the implied probability set by the oddsmakers. Gut feeling and even experience, will only get you so far. Research is key, so crunch the numbers and understand the statistics behind any event that you’re betting on. You’ll be surprised at how easily incorrectly priced markets jump out at you, once you’ve done this hard work.

Shop For Prices

If you’re looking for instances when a sportsbook has incorrectly priced a betting market, then it makes sense to shop around. Your chances of finding a +EV wager will be limited if you are only signed up to one sportsbook and that is your sole source for betting. Instead, check out odds comparison sites to find EV markets. Peruse our recommended sportsbooks and sign up with several, to create a portfolio of betting accounts.

Get in Early and Late

You can often find EV wagers when markets are released early. Oddsmakers don’t have as much information about the event as they will have nearer the time, so will create soft lines. Eagle-eyed bettors will be looking for such opportunities and odds will start to shift when they start to take advantage, so get in early. Yet while striking early can pay off, there can also be opportunities if you wait. Hot favorites can end up being evenly matched with an underdog in live betting markets.

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