What does EV mean in betting? Complete EV Betting Guide 2023

If you’re curious about EV in betting but are unsure what it means, this article will explain everything there is to know and how you can use it to become a profitable bettor. We’ve left no stone unturned so you will no longer be asking yourself what does EV mean in betting, and can deploy tips and strategies to suit your budget and betting style to maximize returns.

Not only will you discover how to find value bets, but also learn the differences between positive and negative EV to create a strategy for long-term successful ROI. Our experts also reveal the top sportsbooks on the market to make the most of EV, as well as detailing top sign-up bonuses to get you started. Read on to learn more as we uncover the basics and importance of EV.

What is EV and what does it stand for?

EV is an abbreviation of Expected Value and is a method you can use to work out the amount of money you can win or lose when placing a bet, based on a gap in the probability of an outcome. In simple terms, you can use it to calculate the difference between a bookmakers’ predictions and your own. If you think that one team has a better chance of winning than what the sportsbook is suggesting, you have found a value bet and would assign a positive EV. If you believe that the team has a lesser chance of winning, you would assign a negative EV.

Ultimately, betting outcomes are based on probability and the odds shown on a sportsbook site represents how likely an outcome is to happen, such as one team winning a basketball game. Through betting lines, sportsbooks set their probability, creating a favorite and an underdog. You can use these odds to identify betting value where one team may be undervalued.

Why is EV important for Bettors

Identifying expected value bets consistently will allow you to become a profitable bettor long-term. With a more savvy outlook compared with other bettors, you can identify gaps in probability outcomes for all bet types, including moneyline, point spread and totals markets. Knowing exactly what EV means in betting and how to use it allows you to bet smarter through careful planning, to give yourself the edge over a sportsbook. Let’s take a look at a couple of examples below.

In an NBA game between the Boston Celtics and Philadelphia 76ers, the Celtics may be priced at moneyline odds of +120, giving them an implied probability of 45.45%. However, if you believe that the Celtics have a greater chance of winning than 45.45%, you have identified positive EV and can bet accordingly.

Similarly, in a NHL game between the Pittsburgh Penguins and New Jersey Devils, the Penguins may be priced at moneyline odds of +300, giving them an implied probability of 25% to win. If you think they’re less likely to win than this because their star player has suffered a last minute injury, you have identified negative EV.

How to Calculate EV

To calculate EV, you need to work out the probability of the outcome occurring. You can do this by adding the sportsbook’s positive moneyline odds to 100 then divide the number by 100. You can use an odds comparison table to view the likeliness of the result as a percentage as suggested by the sportsbook. The formula is as follows:

100 / (Odds + 100)

Therefore, if the odds on offer are +150 (underdog), the calculation is:

100 / (150 + 100) = 40%.

If the odds are negative (favorite), you need to divide by the line number instead of 100, as follows:

Odds / (Odds + 100)

In the event of odds being -200, the calculation is:

200 / (-200 + 100) = 66.67%.

You can also use the probability from your own predictions or from another sportsbook site, and divide it by the sportsbook to get the value bet margin.

If we take the above probability example of 40% from the sportsbook, and use our own prediction of 45% (where we think a team has a 5% greater chance of winning), we can do the following calculation:

45%/40% = 1.13.

You can use the above calculation to utilize value betting and consistently return profit, regardless of the sport you are wagering on. The key to calculating EV is to give yourself plenty of time to find value bets, with earlier markets proving more beneficial. We’ll cover more on this and other tips further into this guide. In the meantime, keep reading as we discuss the key differences between positive EV and negative EV.

Positive EV vs Negative EV

Positive expected value is when you believe that the odds from a sportsbook or odds-maker are undervalued. Negative expected value is when they are overvalued. The fundamental difference between positive EV and negative EV is the suggestion of making a profit or loss over time.

For example, if you believe a favorite or underdog in any NFL match-up has a greater chance of winning the game than what the operator is suggesting, then you have found a positive EV opportunity.

To break this down in a real world scenario, in a NFL playoff game between Kansas City Chiefs vs Philadelphia Eagles, you may think that the Eagles have a better chance of beating the Chiefs because the Chiefs’ star player Patrick Mahomes has suffered an injury. You have identified a value bet and lock-in your wager before the line is adjusted or the odds are updated.

It’s worth bearing in mind that negative EV does not always mean you are going to lose money or the betting opportunity is not profitable. Betting odds are subjective, so you can still make a correct prediction about the outcome of an event or game compared to the sportsbook or betting-exchange user.

What is Vig?

Vig stands for Vigorish and is a fee charged by almost every sportsbook online and land-based. Also known as a cut, or house edge, the vig is considered a levy on all bets placed at the sportsbook regardless of whether you win or lose and is built into the odds. It is a way for the operator to take a cut and earn guaranteed money. If you wager at a betting exchange instead of a sportsbook, the operator takes a commission instead as a means of making money no matter the outcome.

To put vig into perspective, let’s look at an example scenario whereby you bet on an event with a 50/50 chance, such as a coin toss or rolling an even or odd number on a standard dice. The probability is 50% and the odds should be +/-100 for either outcome. However, in the betting world they are more likely to be -110. This means that you are paying around a 5% fee on all bets. Therefore, you need to win 52.36% of your bets to break even.

How to Calculate Vig

The vig is not published by the sportsbook, so it is up to you to calculate it yourself. You can calculate vig on all bets by converting the odds into implied probability then doing the simple equation below:

Favorite odds + Underdog odds – 100(%) = Vig.

When you add the two probabilities together and subtract 100, the difference you see between the two is the vig.

For example, in a MLB game between the San Francisco Giants vs Chicago White Sox, where the implied probability is 46% and 57% respectively, the equation looks like this:

57% + 46% – 100% = 3%.

Therefore the vig is 3%.

It’s worth noting that this calculation works only where there are two possible outcomes, such as point spread or totals markets.

However, the principle of the equation is the same, where more than two outcomes exist, such as NHL or soccer games. The outcome here can be a home win, away win or tie (draw). Therefore the equation is as follows.

Favorite odds + Underdog odds + Tie odds – 100(%) = Vig.

For example, in a NHL game between Tampa Bay Lightning and the New York Rangers, where the implied probability is 40% and 43% respectively and 23% to tie, the equation looks like this:

43% + 40% + 23% – 100% = 6%.

Therefore the vig is 6%.

EV vs Arbitrage Betting

Arbitrage betting is a strategy that has been inherited from trading markets such as finance, and allows you to benefit from discrepancies in odds and implied probability from two different sportsbooks. It is particularly effective in sports markets where there can only be two outcomes, such as point spread, run line, puck line and total points. However, it can also be deployed for moneyline bets on multiple sportsbook sites or betting exchanges. The principle of arbitrage betting is that you are essentially backing both teams to win and earning a profit from either outcome.

Let’s draw an example from a real-world NBA game between the New York Knicks vs Indiana Pacers. You can essentially place a wager on each team to win with different sportsbook operators and make a profit regardless of which team is victorious. Of course one wager will lose, but the profit from the other will outstrip the loss. In its simplest form, you may need to wager $300 on the Knicks for a $500 return ($200 profit) at sportsbook A, and $100 on the Pacers for a $600 return ($500 profit) at sportsbook B. Overall you have staked $400 in total, but will return either $500 or $600 depending on the outcome.

Earlier in our guide to what EV means in betting, we touched on the possibility of comparing odds from two different sportsbooks to form a positive EV. This is similar to the arbitrage strategy, whereby you can exploit discrepancies in implied probability on both outcomes to make a profit.

When comparing the two systems side-by-side, we can make a judgment on which strategy is more profitable and right for us as individuals. In this case, EV is more commonly used with your own probability versus the sportsbooks’ probability. If you have the time on your hands to research and analyze statistics in order to identify a value bet, EV may be your preferred choice. It also requires you to bet only on one single outcome. If you prefer a less-intensive approach but don’t mind browsing multiple sportsbooks for arbitrage opportunities, this strategy can be key to long-term ROI. However, it does require you to wager on all outcomes of the game at the right odds and also requires a larger bankroll.

Tips to Identify Value in Betting

As we look to wrap up our guide to EV betting, you should no longer be asking yourself the question what does EV mean in betting, but instead looking to make a decision on whether it is right for you and how to use it successfully. Ultimately, if you want to make a profit from sports wagering consistently, you can examine and study expected value as part of a long-term ROI strategy using the tips below.

Look For Early Lines

As soon as a sportsbook operator releases its betting lines, you can capitalize on potential value bets before the average bettor influx begins. It is common for opening lines to fluctuate before a game kicks off, particularly if they have been released a few days in advance.

Avoid Betting on Your Favorite Team

Avoid betting with your heart and bet with your head by avoiding your favorite team. EV betting allows you to separate business from pleasure and make informed decisions that aren’t skewed by passion or adrenalin.

Be Wary of Public Betting

The general public often bet on popular or favorite teams from within a particular sport, such as the Los Angeles Lakers in the NBA, or New England Patriots in the NFL. However, these teams get the most attention from the media and sports fans, which can distort the lines and potential value in a bet.

Use Market Makers

Using the market makers in a particular sport to view odds and lines will allow you to be ahead of the game before the rest of the market follows. If you can identify who the market makers are, you can see the market move before other sportsbook betting lines are updated.

Use Multiple Sportsbooks

Various sportsbooks have specialties when it comes to setting odds and lines. By using two or more sportsbook sites, you have multiple tools in your arsenal for spotting a value bet.

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