Lesson 1: Advanced Sports Betting Theory
In this lesson, we will delve into the advanced theoretical aspects of sports betting, focusing on the concepts of value, implied probabilities, and expected value. Understanding these concepts will provide you with a strong foundation for making informed betting decisions and maximizing your potential profits.
Value is a crucial concept in sports betting. It refers to the difference between the true odds of an event occurring and the odds offered by the bookmaker. When the bookmaker's odds are higher than the true odds, a value bet is present, providing an opportunity for long-term profitability.
Imagine a soccer match between Team A and Team B. You believe that Team A has a 60% chance of winning, while the bookmaker has priced Team A at odds of 2.00 (or 1/1 in fractional odds). To determine if there is value in this bet, you must calculate the implied probability of the odds offered.
Implied probability is the percentage chance of an outcome occurring, as suggested by the odds. To convert odds to implied probability, you can use the following formula:
Implied Probability (%) = 1 / Decimal Odds * 100
Using the example above, the implied probability for Team A at odds of 2.00 is:
Implied Probability (%) = 1 / 2.00 * 100 = 50%
Since your estimation of Team A's chances (60%) is higher than the implied probability suggested by the odds (50%), there is value in this bet.
Expected value is a measure of the long-term profitability of a bet. A positive expected value indicates a profitable bet over time, while a negative expected value indicates a losing bet. To calculate the expected value, use the following formula:
EV = (Probability of Winning * Potential Profit) - (Probability of Losing * Potential Loss)
Continuing with the previous example, let's assume you want to place a 100 EUR bet on Team A. The potential profit if Team A wins is 100 EUR (100 * 2.00 - 100), while the potential loss if Team A loses is 100 EUR.
EV = (0.60 * 100) - (0.40 * 100) = 60 - 40 = 20 EUR
In this case, the expected value of the bet is positive, indicating that it is a profitable bet over the long term.
Understanding the concepts of value, implied probabilities, and expected value is essential for successful sports betting. By identifying value bets and calculating the expected value, you can make more informed decisions and increase your chances of long-term profitability.
As a member of SSTrader.com, you will have access to advanced tools and resources to help you identify value bets, analyze implied probabilities, and calculate expected value, ensuring that you stay ahead in the competitive world of sports betting.