Expected value

[ChalkyDog]

Alright gents, as I have read through these forums over the small amount of time I've been on here, I keep seeing the term expected value.

Is this a word people are throwing around or do you guys actually go about figuring out expected values on your bets?

If the former, carry on. If the latter, are you guys using a very basic EV equation?

For example, do you guys jump into something like:

EV = P(O1)V(O1) + P(O2)V(O2)

EV = expected value
P = probability
V = Value
O = Outcome

The above "equation" is clearly presuming only two potential outcomes. I.e. either team A wins(O1) or team B wins(O2).

So, back to the question - when you genius' are talking about +EV or -EV, and are actually using an equation to figure it out, are you using something like the equation I typed out above?

[TheCentaur]

Are you talking about casino games or sports betting? I don't see how you can with any certainty calculate EV of a sports bet

[ChalkyDog]

Are you talking about casino games or sports betting? I don't see how you can with any certainty calculate EV of a sports bet

This is an interesting point and something I am in the process of. As of right now, it's all theoretical. If we're talking straight ML's, we can fill in the probability pretty easily. When you start incorporating spreads, I get lost.

This all started when I started trying to figure out what I think the ppl of SBR call EV for table games a few months back due to sitting down at a table with some asian who went off on a tangent talking about game theory and the Gamblers fallacy/ruin.

Long story short - has anyone figured out how to incorporate this with sportsbetting that isn't just straight ML's?

[magyarsvensk]

Expected value is by far the best way to develop a system. Don't get involved with probabilities. They are a red herring.

[magyarsvensk]

Are you talking about casino games or sports betting? I don't see how you can with any certainty calculate EV of a sports bet

How with any certainty can you calculate the probability of a sports bet? One begets the other. The advantage of EV is that it is more in tune with the concept of making money. Calculating the probability is an unnecessary step.

[Sawyer]

The only way to decide if a pick is EV+ or not, is to compare line you got with Pinnacle's line. If your line is better then Pinnacle, your bet is EV+.

[downsouth]

The only way to decide if a pick is EV+ or not, is to compare line you got with Pinnacle's line. If your line is better then Pinnacle, your bet is EV+.

99.9% of people who talk about EV have zero idea of what it actually pertains too.

[KVB]

Calculating the expected value of a sports wager requires one to know (or at least guess) the probability of winning, or losing, that wager. There is no way to do it otherwise. Yes chalky, there are simple equations.

Can you know the probability of you winning a sports wager?

Yes you can. And if it’s better than breakeven (counting price) over the long term, I call it an edge. But you can’t know the probability of winning a point spread or total bet without knowing the offered point spread or total. Not understanding EV is prevalent, but I think some bettors jump from EV to Pinnacle, like Sawyer, because they think by being efficient over the market they have a higher probability of winning. Unless they can calculate (which is possible), with numbers, the probability of success based on efficiency of the market, the issue with such a jump reveals itself over the long term profit picture. It is not good enough to just say I can beat the market by X% and am therefore a long term winner. At least, one can do better.

With a win-loss wager, you can know the probability of a particular side winning, but, betting wise, it tells you nothing without on offered money line, or price to determine whether the bet is profitable.

And profit is what counts.

While you can know your edge over the long term, however, it is difficult to be 100% certain of your edge for a given bet. This is where I have an issue with Kelly betting and such systems and recommend keeping those bets flat.

Understanding the difference between your, better number, and the offered lines is important. The differences can help determine your edge or probability of winning your bet, but likely won’t vary enough to bet multiple units. But that’s a money management issue.

[rm18]

I just guess you cant really know your exact edge, but I have a clue. Although sometimes if you are a decent size bettor it is not really important to know your exact edge as long as you know you have an edge you just bet the max for a lot of things like props with a limit of 1k or less or bubble gum bookies that do not take big bets are regular games.

Like last night I bet the Royals to win the division +800 for the max at intertops. So I just need them to win a little over 11% to be profitable. I have no idea what the exact chance is but I am sure it is over 15%.

[BigDeem5]

Sounds EV

[MoneyLineDawg]

99.9% of people who talk about EV have zero idea of what it actually pertains too.

There's a few guys on here with great info but most of the people mentioning EV are lost

[ChiLLx]

EV = p*(O-1)*X - (1-p)*X = (pO - 1)*X

[magyarsvensk]

But you can’t know the probability of winning a point spread or total bet without knowing the offered point spread or total.

This
Makes
No
Sense

If you truly believe that the casino odds are a necessary component of the actual true-to-life probability of one team winning over the other, then you are by your own definition ****** and should never bet. You are postulating that the sports books can without exception predict the future. If the books are always right, then you would always lose.

[magyarsvensk]

I just guess you cant really know your exact edge, but I have a clue.

Most guys on here place like 3-4 bets per day which would not generate a decent sports betting sample size over an entire season. This is not to mention that measuring an "edge" would mean you are trying one system over the whole season and not jumping from one to the other like most people do.

[magyarsvensk]

The only way to decide if a pick is EV+ or not, is to compare line you got with Pinnacle's line. If your line is better then Pinnacle, your bet is EV+.

Wrong in the same way. If the books are always right, then you are always wrong. Period, end of story, may as well throw in the towel.

People here need to take math classes. It is possible for the books to have a system that works for them that still has holes in it that can be exploited. But if they are right about every single line that that post (like you claim above) then no edge can be gained.

[KVB]

This
Makes
No
Sense

If you truly believe that the casino odds are a necessary component of the actual true-to-life probability of one team winning over the other, then you are by your own definition ****** and should never bet. You are postulating that the sports books can without exception predict the future. If the books are always right, then you would always lose.

You misread the statement. I do not believe the casino odds are a necessary component of the actual probability of an event. I am not postulating what you say...I am saying the opposite.

I am actually saying, if you come up with a team to win a game by X points you must compare that line with the line offered. It is in that difference that you obtain your probability of winning the bet. I am saying the bookmakers are forced to a mediocre line that can be exploited.

In other words, you don't know if you have a bet until you see the line offered. Specific example...you make a valid line that has a team to win by 50 points. If that team is offered as a 50 point favorite, you have no bet.

Read my post again.

[tony_come]

It's all about numbers

[KVB]

Most guys on here place like 3-4 bets per day which would not generate a decent sports betting sample size over an entire season. This is not to mention that measuring an "edge" would mean you are trying one system over the whole season and not jumping from one to the other like most people do.

Agreed...finding and maintaining an edge takes much, much more than one season's worth of betting. I've had a NFL losing season that, when combined with the season before, OR after, resulted in over 400 bets with over 58% winners. Volatility isn't just week to week.

[Sawyer]

It's all about numbers

it's all about pinnacle.

Wrong in the same way. If the books are always right, then you are always wrong. Period, end of story, may as well throw in the towel.

People here need to take math classes. It is possible for the books to have a system that works for them that still has holes in it that can be exploited. But if they are right about every single line that that post (like you claim above) then no edge can be gained.

LoL. No book on earth can be right all the time but "some" books (asians and pinny) are "right" over long haul while some books (soft bookies) are wrong. You can't understand it unless you don't experience it. Do you make 800k € monthly turnover to make this observation? For how long, you're tracking/observing Pinnacle?

Well, I like to share my experiences. I'm a arbitrage trader, my monthy average volume is 800k € and I lost 286k € in pinnacle & asians last year.

If you're making a comment about a subject, then you must have some arguments. Numbers don't lie. I can see clearly what is EV when I look my records..

Ask any arbitrage trader and you will get the same answer.

[The Kraken]

So is $800k per month the cutoff to have a valid opinion on this matter? And does it count against me if I won $286k instead of losting it?

Seems a bit arbitrary to me.

[Sawyer]

So is $800k per month the cutoff to have a valid opinion on this matter? And does it count against me if I won $286k instead of losting it?
Seems a bit arbitrary to me.

Not arbitrary, i'm talking about arbitrage, hehe.

You win in softbook side while you lost in pinnacle side, when making arbitrage. Yes, I lost approximately 285k in pinnacle/asian side last year and won 564k on softbook side. Ask any arbitrage trader and you won't get a different answer. Softbook side always winning, sharp book side always negative. Because the wager you bet on softbook side is "value". When you cover it at Pinnacle, you're betting something non-value. If you could pick that bet in Pinnacle before odds drop, that would be super value.

If one side keeps winning over long haul, then isn't it best, real definition of value?

You can beat softbooks but beating Pinnacle not easy. Most bettors and "all" arbitrage traders are negative in Pinnacle, over long haul. Yes, all. It's impossible for an arbitrage trader to be plus in Pinnacle, over long haul. (You may have wild periods when you win a lot in pinnacle side but over long haul, you're doomed to lose there)

Not only turnover, some years are also required. Money flows from softbooks to sharp book. You realize it with time. Pinnnacle Lean is the exact, best definition of EV+ Bet. If somebody disagree with it, I won't even discuss it.

[Optional]

it's all about pinnacle.



LoL. No book on earth can be right all the time but "some" books (asians and pinny) are "right" over long haul while some books (soft bookies) are wrong. You can't understand it unless you don't experience it. Do you make 800k € monthly turnover to make this observation? For how long, you're tracking/observing Pinnacle?

Well, I like to share my experiences. I'm a arbitrage trader, my monthy average volume is 800k € and I lost 286k € in pinnacle & asians last year.

If you're making a comment about a subject, then you must have some arguments. Numbers don't lie. I can see clearly what is EV when I look my records..

Ask any arbitrage trader and you will get the same answer.

You're just saying that beating Pinny lines works. It's definitely not "all about Pinnacle".

That may work but it's the easy and less profitable way. Developing a system to calculate your own probability and bet against that will be more profitable than simply beating the pinny closer. Even if your system is only half as efficient as it could be it will be better than blindly imagining Pinny lines represent true odds.

[Optional]

Not arbitrary, i'm talking about arbitrage, hehe.

You win in softbook side while you lost in pinnacle side, when making arbitrage. Yes, I lost approximately 285k in pinnacle/asian side last year and won 564k on softbook side. Ask any arbitrage trader and you won't get a different answer. Softbook side always winning, sharp book side always negative. Because the wager you bet on softbook side is "value". When you cover it at Pinnacle, you're betting something non-value. If you could pick that bet in Pinnacle before odds drop, that would be super value.

If one side keeps winning over long haul, then isn't it best, real definition of value?

You can beat softbooks but beating Pinnacle not easy. Most bettors and "all" arbitrage traders are negative in Pinnacle, over long haul. Yes, all. It's impossible for an arbitrage trader to be plus in Pinnacle, over long haul. (You may have wild periods when you win a lot in pinnacle side but over long haul, you're doomed to lose there)

Not only turnover, some years are also required. Money flows from softbooks to sharp book. You realize it with time. Pinnnacle Lean is the exact, best definition of EV+ Bet. If somebody disagree with it, I won't even discuss it.

You might be successful but it sounds like you really have little clue about calculating EV.

NONE of what you say is proof that Pinnacle's odds represent true odds, or a +EV line.

All your proof says is that Pinnacle is sharper and moves it's lines faster than the other books. It says zero about the EV of the underlying bets at all.

[magyarsvensk]

it's all about pinnacle.



LoL. No book on earth can be right all the time but "some" books (asians and pinny) are "right" over long haul while some books (soft bookies) are wrong. You can't understand it unless you don't experience it.

I understand what you are saying, and I agree with the premise. Sportsbooks are good at picking lines that make money over hundreds of thousands of games. Their job is to make money off of the average gambler.

So if you can average ~2% better odds than the closing lines over hundreds of thousands of bets, then congratulations, you are breaking even.

Just because the books make money over hundreds of thousands of games doesn't mean that all of their lines are perfect. Some favor the home team, some favor the away team, some favor the favorite, some favor the dog. It is only when you average them over the very long haul that they make money for the books. Your premise that "the only way to have a positive expected value is to compare your line to the closing lines" would be a much stronger statement than mine -- namely that every single closing line has a negative expected value.

First of all, it's idiotic to think that. No one -- not even the books -- can predict with 100% certainty the actual probability of sporting events.

Secondly, you need to take more math classes if you have deduced that. There are an infinite number of possible systems that can beat the books.

And what do I care if you are an arbitrage trader? The vig in sports betting is constant -- a much bigger hurdle than in trading.

[MoneyLineDawg]

Not arbitrary, i'm talking about arbitrage, hehe.

You win in softbook side while you lost in pinnacle side, when making arbitrage. Yes, I lost approximately 285k in pinnacle/asian side last year and won 564k on softbook side. Ask any arbitrage trader and you won't get a different answer. Softbook side always winning, sharp book side always negative. Because the wager you bet on softbook side is "value". When you cover it at Pinnacle, you're betting something non-value. If you could pick that bet in Pinnacle before odds drop, that would be super value.

If one side keeps winning over long haul, then isn't it best, real definition of value?

You can beat softbooks but beating Pinnacle not easy. Most bettors and "all" arbitrage traders are negative in Pinnacle, over long haul. Yes, all. It's impossible for an arbitrage trader to be plus in Pinnacle, over long haul. (You may have wild periods when you win a lot in pinnacle side but over long haul, you're doomed to lose there)

Not only turnover, some years are also required. Money flows from softbooks to sharp book. You realize it with time. Pinnnacle Lean is the exact, best definition of EV+ Bet. If somebody disagree with it, I won't even discuss it.

Why not just pound the soft books and lay off the Pinny arbs? Sounds like you would have made 564k last year....

[Sawyer]

Why not just pound the soft books and lay off the Pinny arbs? Sounds like you would have made 564k last year....

If I attempted that, I would be bankrupt! You're not prone to losing streaks. You may be betting value but still, you will experience disastrous losing streaks. So i'm laying off pinny arbs only in some niche markets, US Sports mostly. (My "You're wasting money if you're covering other side in Pinnacle" thread is about it. You can find it in SBR Forum Handicapper Think Tank Archieves)

First of all, it's idiotic to think that. No one -- not even the books -- can predict with 100% certainty the actual probability of sporting events.

%100 certainity? Are you crazy? Who can hit %100? And why you think %100 certainity is necessary? There isn't anything such as %100. Remember, even %55 (-110) works for pro handicappers to make money. Even Pinnacle Lean is prone to losing streaks but still, they're usually right.

You're just saying that beating Pinny lines works. It's definitely not "all about Pinnacle".

That may work but it's the easy and less profitable way. Developing a system to calculate your own probability and bet against that will be more profitable than simply beating the pinny closer. Even if your system is only half as efficient as it could be it will be better than blindly imagining Pinny lines represent true odds.

Sure, it works. You can try to develop a system to calculate our own probability but to do it, you must be good as pinny linesmakers and their sharp clients (people who shape their lines such as betting syndicates and sharp handicappers)

Let me give you a better way to test the efficiency of your system. Let's say you come up with a play, like Miami-Lakers Over 202. You picked Over 202 at -105. Now observe line movement and track the pinny closer. If Pinny closer is Over 204 -110, Well done! You picked a great bet and your system picked a great pick. If Pinny closer is Over 200 +100, then your system sucks, lol.

[ace888]

There may be infinite ways to beat books but finding one of them may take years thus pinny is the most reliable source without much work

[MoneyLineDawg]

Because you're not prone to losing streaks. You may be betting value but still, you will experience disastrous losing streaks. So i'm laying off pinny arbs only in some niche markets, US Sports mostly.

Still makes no sense if what you're saying is year after year for your arb account you show a losing Pinny side and a winning soft book side

Why not just cut out the side that brings you down overall and take the steady stream of profits?

Losing streaks or not, you are saying that in the long run you will constantly show a profit betting the other side so I still don't understand why you would hedge your maximum profits betting into a near-certain loss side, Pinny

[Sawyer]

You might be successful but it sounds like you really have little clue about calculating EV.

NONE of what you say is proof that Pinnacle's odds represent true odds, or a +EV line.

All your proof says is that Pinnacle is sharper and moves it's lines faster than the other books. It says zero about the EV of the underlying bets at all.

Opti, I suggest you to read again.
Let me give an example.

Barcelona is playing versus Valencia

You will pick Barcelona -1,5 or Valencia +1,5. Which one is value? How you can know?

Barcelona -1,5 is 2,20 (+120) in Xbet.
Barcelona -1,5 is 1,909 (-110) in Pinnacle.

Barcelona is a EV+ bet here.

Pinnacle is the exact definition of value betting.

[ace888]

Still makes no sense if what you're saying is year after year for your arb account you show a losing Pinny side and a winning soft book side

Why not just cut out the side that brings you down overall and take the steady stream of profits?

Losing streaks or not, you are saying that in the long run you will constantly show a profit betting the other side so I still don't understand why you would hedge your maximum profits betting into a near-certain loss side, Pinny

Even though losing in the pinny side in the long run is 100%, you don't know when you will lose in the softbook or in the pinny. what if 180 of first 250 bets win in pinny side and then your bankroll is gone ? I dont know if this is the case or not but pinny side should be insurance for his money. A bettor always has to keep in mind that he doesnt have infinite amount of money. Otherwise, martingale would be a great strategy.

[Sawyer]

Still makes no sense if what you're saying is year after year for your arb account you show a losing Pinny side and a winning soft book side

Why not just cut out the side that brings you down overall and take the steady stream of profits?

Losing streaks or not, you are saying that in the long run you will constantly show a profit betting the other side so I still don't understand why you would hedge your maximum profits betting into a near-certain loss side, Pinny

MonelineDawg,

Let me add something. It's not just me, it's EVERYONE! Every arber..

Well, reason is simple. To maximize profit!

If you're not arbing, just picking the value bets, then you won't be able to bet much as you did in arbing since you have to stick with a money management plan. But when arbing, you can bet much as you can! It lets you maximize your profit.

Why take risk when you can make profit regardless of result? And why take risk of wiping your whole bankroll? I had times when I cleared my softbook accounts and all money accumulated in Pinnacle, rare but it happens sometimes. And why not miss middle bet opportunities? When you hit a middle bet, you win both bets! If you don't cover your bet in sharp book side, you will hit only 1 bet.

Oh btw, in some "niche markets", I'm doing what you said. I don't cover pinny side or leaving the profit in soft book side.

[MoneyLineDawg]

MonelineDawg,

Let me add something. It's not just me, it's EVERYONE! Every arber..

Well, reason is simple. To maximize profit!

If you're not arbing, just picking the value bets, then you won't be able to bet much as you did in arbing since you have to stick with a money management plan. But when arbing, you can bet much as you can! It lets you maximize your profit.

Why take risk when you can make profit regardless of result? And why take risk of wiping your whole bankroll? I had times when I cleared my softbook accounts and all money accumulated in Pinnacle, rare but it happens sometimes. And why not miss middle bet opportunities? When you hit a middle bet, you win both bets! If you don't cover your bet in sharp book side, you will hit only 1 bet.

I know how it all works and I guess it comes down to money management/lack of funds

So theoretically if you could never go broke with an unlimited bankroll and could max bet, it would be better to just value bet the soft books? But being that they do exist in the real world, it's better to arb and middle like you do?

[Optional]

Opti, I suggest you to read again.
Let me give an example.

Barcelona is playing versus Valencia

You will pick Barcelona -1,5 or Valencia +1,5. Which one is value? How you can know?

Barcelona -1,5 is 2,20 (+120) in Xbet.
Barcelona -1,5 is 1,909 (-110) in Pinnacle.

Barcelona is a EV+ bet here.

Pinnacle is the exact definition of value betting.

Sure, the Xbet odds are more likely to represent 'value' knowing they are out of line with Pinnacle but there is no way to know if that particular bet is really +EV without capping the match.

+EV of an individual bet is not something an arber is concerned with anyway is it? You only care about the differential between the books odds not how likely either team is to win?

I agree Pinny can be a good guide, but I think you are confusing Pinny beating up the other books you arb against them with, with Pinny odds giving away 1 sided bet winners.

[Sawyer]

Sure, the Xbet odds are more likely to represent 'value' knowing they are out of line with Pinnacle but there is no way to know if that particular bet is really +EV without capping the match.

Capping the match? Man, match is already capped! Let's take Houston-Arizona game for example. Pinnacle Houston -125, Arizona +113. I got Houston +100 in offsidebet/admiralbet/wsbets/hiperbet.

Houston +100 Softbook
Houston -125 Pinny

The "value side" is Houston here. I don't care if they win or not. You're making a "correct", a "right" bet by picking Houston here. The game is already capped. Ah, if you think you can handicap this game better then pinnacle, then be my guest!

[KVB]

I think we've broken away from calculating actual EV to just whether it is positive or not but this has been a good review and a fine read. Nice discussion posters.