If you want to be successful betting on sports, it’s imperative that you bet only when there is value available. But what is a value bet and how can you find them? In this article we will show you why value betting is crucial to profitable betting and how you can sharpen your eye for value betting opportunities.
Value betting is not an easy concept to understand. Most casual bettors simply do not understand what is involved in value betting and why it is so key to long term success as a bettor. Many novice bettors have difficulty getting their head around the idea that while a team may be at long odds and only a slight chance to win an upcoming football match, they may in fact be the value bet.
Value Betting: What is it?
The difference between a profitable bettor and an unprofitable bettor is the ability to firstly, identify value bets and secondly, only bet when there is a value bet available.
In essence a successful bettor understands the difference between the probability of a team winning an upcoming contest and the probability of that team winning in comparison to the odds available from a given bookmaker.
Successful betting is in finding value bets and remaining disciplined, betting only when you have found value. This often means betting on underdogs at long odds, holding your nerve waiting for the big upset that will surely come. Think of all those huge upsets in the world of sport, occurring week after week across a broad range of sports. When these upsets happen, you might often wonder about who would have bet on that team. The answer is, profitable patient and disciplined bettors.
Value betting might seem like common sense to a veteran sports bettor, but for many just starting out as a bettor, wanting to make the move from casual punter to an applied serious sports bettor, dedicated to the discipline of value betting, the transition can be difficult.
Calculating Value Bets
Shortly we will discuss popular methods for finding value bets. But before we do, let’s take a look at how to calculate a value bet.
As we stated earlier, a value bet is one where the probability of the outcome occurring is greater than the probability implied in the odds on offer from your bookmaker.
Let’s look at a simple example. Here we will bet on the toss of a coin. As we would assume, the chances of the coin landing on heads is 50% while the chances of the coin landing on tails is also 50%.
Let’s further assume that a bookmaker is giving us odds of 2.10 for the coin to land on tails. This is what we call a value bet. Why is this a value bet? Let’s complete a simple calculation:
Value = (Probability * Decimal Odds) – 1
So in our example, the calculation would be as follows:
Value = (0.5 * 2.10) – 1
Value = 1.05 – 1
Value = 0.05
If the assessed value is greater than 0, then you have a value betting opportunity.
So as we can see, betting on the coin to land on tails at the odds offered by our bookmaker of 2.10, is indeed a value bet.
Of course, betting on events that are less predictable than a coin toss is far more difficult. With a coin toss we know that the outcome is either 50% for heads and 50% for tails. Further, bookmakers are not going to make such a glaring error as in our example in terms of framing their odds. We may offer our best guess at who is going to win an upcoming Champions League match between Barcelona and Chelsea, but is at the end of the day our best guess. This is what makes value betting so difficult. In order to make money betting on sports long term, our predictions as to the likelihood of any given outcome need to be more accurate than the odds on offer.
It not only takes time to learn to identify betting value, but perhaps more importantly, it takes time to build confidence in your approach. As with anything worth doing, it takes time and effort to develop a keen sense for betting value. Let’s now discuss ways in which we can enhance our chances of identifying value betting opportunities.
Many novice punters make the error of wanting to bet on everything and anything. Yes enthusiasm is good, but so too is focus. When starting to bet on sports seriously it’s a good idea to limit yourself to a few sports or leagues, particularly those that you know best. In order to develop confidence in your value betting approach, it’s wise to focus on the competitions you know best.
Finding value bets does not require you to be a genius with maths (although it wouldn’t hurt). What value betting does require is an understanding of probability. In particular, you need to know how to reveal the implied probability behind given betting odds. This can be calculated in the following manner:
Implied Probability = 1 / decimal odds
Let’s return to our coin toss example. In this example the odds were 2.10 for the coin landing on tails.
Implied Probability = 1 / 2.101
Implied Probability = 47.62%
So given these odds, there is a 47.62% chance of the coin landing on tails. However we know that the chances of the coin landing on tails is 50%. So again, we can see why this is a value bet. Why? Because the chances of the coin landing on tails, 50% is greater than the chances reflected in the odds of 2.10, that being 47.62%.
Setting your own odds, also known as ‘pricing up’ is a very productive exercise. What does it involve? Pricing up involves sitting down and looking at a set of upcoming sporting events or fixtures and composing your own odds for each. Importantly, you do not look at any listed odds prior to pricing up. Rather, it’s just you and your opinion.
In order to do this, you should look to settle on a compromise, odds that if you were asked to bet on, you wouldn’t feel comfortable betting on one outcome or another. Through this task, you are basically acting as a bookmaker would in setting your own odds. While it is a task that takes time, it exercises your betting intuition and over time through repetition you’re instincts for betting value will sharpen. Most importantly it demands that you think in terms of probabilities, not in simple black-white, win-lose terms that so many unsuccessful punters are prone to.
Understand The Market
Never forget that you are betting into a market. Just like every other market where commodities and positions are bought and sold, a betting market asks you to buy and sell investments on a given outcome. It’s not an easy understanding to come to terms with and in many ways it can diminish the experience of watching a sporting event.
It’s often been said that you cannot know where you’re going, if you do not know where you’re coming from. This is just as true when it comes to successful sports betting. If you want to improve your betting into the future, it’s crucial that you review and assess your previous performance. What you want to know so much isn’t how much money you’ve made (or lost) but more importantly how often you remained disciplined and bet only on genuine value bets. On reviewing your performance you’ll often find that your profits would be so much greater had you remained disciplined. That knowledge itself should be enough to improve your discipline.
Most of all, you must remain persistent. Developing a sense for betting value takes time and dedication. It won’t happen over night, but through time and persistence your understanding of probabilities and betting markets will become more refined. Your confidence will grow in proportion to the time and focus you spend analysing markets and your performance. Just like everything else in life, experience is hard earned but always worth the effort.