Value Betting

What Is Value Betting?

Value betting is one of the strongest betting strategies that you can apply. It’s based on finding odds that are too high for the outcome of the result and in turn, offering value. The same methods are applied extensively in finance when you’re essentially buying at a lower price for the price to then rise and lock in a profit.

For sports betting, we’re looking at opposing the odds set by the betting site to take advantage of odds that are greater than the probability of the event.

As a quick example, we’re going to look at a simple coin toss. We know that the outcome of heads to tails from the coin toss is 50/50 or in betting terms, this would be even money (+100) and an implied probability of 50% for both results.

So, if a bookmaker were offering “true odds,” they would have odds of +100 for heads and +100 for tails. However, let’s say, for example, the odds for heads were +110, which translates to an implied probability of 47.6%.

We know, for a fact, that the potential outcome is 50% for it to land on heads, so the betting site is giving it less chance (based on odds of +110) than its true probability. As a result, the price of +110 would offer us value as we’re getting higher odds than the probability of the result.

It’s not as straightforward for sports betting. There are many factors as to why odds are what they are, and to find value is a skill that uses data to back up theories about why the bet might offer value. We address this in-depth throughout our definition.

Table of Contents Table of Contents

1. What Is Value Betting?
2. Key Tips & Quick Wins
3. Understanding Probabilities in Relation to Value Betting
4. Value Betting Example
5. Value Betting Strategy
6. Finding Value
7. Value Betting Pros & Cons
8. The Bottom Line
9. FAQs
10. References

Show Full Guide

Table of Contents

1. What Is Value Betting?
2. Key Tips & Quick Wins
3. Understanding Probabilities in Relation to Value Betting
Show Full Guide
4. Value Betting Example
5. Value Betting Strategy
6. Finding Value
7. Value Betting Pros & Cons
8. The Bottom Line
9. FAQs
10. References

Understanding Probabilities in Relation to Value Betting

Understanding probabilities in relation to value betting is a key factor in successfully finding value. In betting, odds are merely reflective of the implied probability of that result or the likelihood of that result winning.

You can jump back to the section above to see the basic way in which it’s applied to a coin toss, but for this next part, we’re looking to apply that to sports betting.

The game below is from the NBA between the Miami Heat and the New York Knicks:

We’re going to take the moneyline odds to highlight the probability of each team winning:

As we can see, the bookmaker thinks that the Heat have a 41.7% chance of winning and the Knicks have a 62.3% chance of winning.

A keen eye will notice that this only adds up to 94% and that’s because vigorish is applied to the market, which is basically the bookmaker’s cut on all bets. We have a full article about how vigorish works if you want to learn more, but you don’t need to worry about it too much for the purpose of value betting.

To find value from this game, we need to oppose one or more of the probabilities. If we think that a team has a better chance of winning, then the bet offers value. If we think they have a lower chance of winning, then the bet does not offer value.

Let’s assume that our research shows that Miami has a 45% chance of winning and New York has a 60% chance of winning (taking vigorish into account). Our odds would look like this:

Based on our adjusted implied probabilities, we can see that betting on the Miami Heat to win at odds of +140 will offer value, whereas betting on the New York Knicks at -165 will not.

Value Betting Example

We’re going to include a couple of value betting examples to see if we can find any value from upcoming games across the US. We will apply some strategy to our picks, but there is more on this in the sections below.

The first game we will look at is an MLB matchup between the Colorado Rockies and the Pittsburgh Pirates:

This is an evenly matched game, but there are some key stats that highlight possible value within the over/under (totals) market:

As we can see, the trend here is that the game is going to finish under the total based on the previous matchups between the two teams. The under is priced at -105 with the bookmaker, which is an implied probability of 51.2%.

Based on the data, all the signs suggest that this is low, and there is a much closer 60% chance that the totals will fall under again. As a result, the under on the totals bet for this would offer value.

Our next example is going to jump back to the NBA game between Miami Heat and New York Knicks:

We’re going to move markets to the over/under bet and we’re thinking that the value lies within the over 209.5 for the following reasons:

It’s similar to the MLB example in that the bookmaker is pricing the over at -110, which is a 52.4% probability, but we think that this should be closer to 60% if both teams play to their ability. As a result, the over 209.5 points is going to be a value bet on this game.

Value Betting Strategy

To find value you need to have a solid strategy in place. In this section, we will look at methods you can apply to find value from your bets:

Finding Value

Finding value is not easy. Sportsbooks run a tight ship and they have big teams and computers that determine the likely outcome of an event. But there is still an opportunity to find value.

One of the best ways to do this is to follow the bet lines and determine why they are moving.

Ыeveral factors contribute to lines moving, but one of the most common is due to the volume of bets. When you have popular sports teams such as the LA Lakers in basketball or the New England Patriots in the NFL, it attracts a lot of money from casual punters backing their favorite team.

When this happens, the sportsbook reduces the odds from what they initially consider to be fair. Now the price no longer reflects the true probability of the result and instead is shortening because of the money.

Let’s run through a quick scenario of how this might work.

The odds below are taken from a game as soon as the book opens, and we deem them to be very close to “true” odds:

Let’s assume that an hour before kick-off a huge volume of bets has been placed on the Patriots to win and as a result, the line has shortened:

Now, we assume that nothing has changed in the build to the game in terms of starting rosters, injuries, etc. However, the bookmaker is now saying that the Patriots have gone from a 60% chance of winning to a 75% chance of winning with no external factors that would suggest a monumental change like this.

From this, we get a 15% boost on the Jets to win in terms of implied probability. The money has forced this line change with most people betting on the Patriots, but now, we get a boost on the Jets to win, which, even though they are underdogs, creates a ton of value.

This is how you find a value bet.

Value Betting Pros & Cons

In this section, we’ve covered the advantages and disadvantages of value betting:

The Bottom Line

Value betting is a strategy in which you find bets with odds higher than the actual probability of the outcome, unlocking profitable opportunities.

Calculating implied probability and comparing it to bookmaker odds allows you to identify value bets. Market inefficiencies, often caused by public betting trends, can shift odds and create value.

It’s important to note that strong strategy, research, and discipline are important to succeeding in long-term value betting.

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