When used in the context of sports betting, “value bets” refers to wagers that represent an opportunity for a bettor to pick up a profit. Value betting strategies work on the assumption that the betting odds presented by the bookmaker are not reflective of the true probability of an event occurring, as the bookmaker must retain some money for operating costs and their own profits. Bettors then assess the bet to see if it will pay out above its true profitability for the bookmaker.
Value bets are all about long-term goals, not immediate satisfaction. Ultimately, you want to make a profit rather than draining cash, which means that you will have to choose your bets carefully to maximise returns over time.
Value bettors start by researching the bet to assess its worth and the likelihood that the event will occur. Perhaps a football team is listed to win a match at 1/5, giving them approximately an 83 percent chance of winning. However, you may realise that the team is in exceptional form and is actually far more likely to win than the bookmakers have estimated. This then represents a good value bet, as it is highly possible that the team will win.
Value betting can be as simple or as complicated as you wish, but the truly astute bettor will calculate the true odds and compare them to the advertised odds while considering the recent performance of a player, team, horse or greyhound. Anything over a decimal odds value of 1.00 is usually considered to be a value bet, as you will receive a profit on your wager.
Calculating the value of a bet is best done using decimal odds in the formula below, where V = value, O = odds and P = probability (in percentages):
V = (O x P)/100
For example, you may be backing Scunthorpe United to beat Swindon Town this weekend. Paddy Power has set odds of 4/1 that the Iron will do the business on Saturday, which you then convert into decimal odds to get 5.00. This gives you a probability rate of 20 percent. However, Scunthorpe have performed well recently, scoring multiple goals over the last few matches, while Swindon are lingering at the bottom of the table and have drawn or lost in recent games. You think that Scunthorpe might have a higher probability of winning than is actually advertised, somewhere closer to 35 percent.
V = (5 x 35)/100
V = (175)/100
V = 1.75
This would be seen as a value bet, with considerable profit to be made on any amount you wager.
Value bets can be a great way to test your knowledge of a sport as well as your maths skills, but you will need to account for short-term losses as these bets do not explicitly guarantee a return. Matches, races and other sporting events don’t always work out as planned, even if you’ve armed yourself with the latest data. Horses fall or fail to start, strikers get injured and bad weather can affect the performance of even the most stalwart tryscorer.
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