Finding value in sports betting is the key to turn betting into a profitable investment. In this betting guide, we will learn you how to become a profitable bettor.
The main goal of bookmakers is to make a profit. This is accomplished by the creation and manipulation of odds. To create odds for a certain event, the bookmakers use several mathematical and statistical methods.
Next, punters can bet on different betting types in the form of odds. During the creation of the odds, various factors are taken into account like quality of the teams, tradition, form, injuries and suspensions and the importance of a game.
How to find value in sports betting
Value mainly depends on a punter´s capability to realistically evaluate the situation related to a sports betting event.
Betting at odds that are rated too ‘high’
If you want to become a profitable sports bettor, keep the 5 golden rules of betting in mind. Each odd has its own implied probability with an odd of 2.00 implying a probability of 50%, an odd of 4.00 meaning a probability of 25%, and so on. Not every odd is a correct representation of the probabilities of the corresponding outcome, however. Bookies (or rather, the bettors who help shaping the odds at bookies) can be wrong. The idea of finding value is to find exactly those odds where the implied probability of the odd is actually incorrect.
Finding value is about having an edge over the bookmakers
If we, at Transparent Bets, consider a certain odd to contain value, we think that we have an advantage over the bookmakers. Put it another way: we think certain odds or margins are too high or too low.
For example, an odd of 2.00 will not have an implied probability of 50%, but rather 60% or even higher. An odd of 4.00 will have a probability of more than 25%, say 30% or higher. In these cases, the bookmaker doesn’t have an edge on you, it’s exactly the other way around. This is what we are looking for at Transparent Bets.
By playing enough of these bets where you have the edge, you will surely make a profit. Just like the bookmaker does. We’ll refer to the law of large numbers of probability theory again, which confirms this.
The profit margin of the bookmaker
In order to find value in sports betting, we have to take into account the profit margin of the bookmakers. We will show you an example how bookmakers almost always manage to end up in profit, regardless of the outcome of a certain event. This is due to the fact that they always try and almost always manage to have a profit margin (also called over round or ‘vig’) on a certain game.
For example: Barcelona and Celtic are meeting within the group stage of the Champions League at the Camp Nou in Spain. The bookmakers put their odds for a home win at 1.10, a tie at 9.10 and a win for Celtic at 31.00. That means the rounded probability for the home team to win is 90.1%, for the tie 11% and for the away team to win is 3.2%. The total sum of these percentages should always be equal to a whole. In this case 100% when the odds are entirely fair (so without any margins).
By adding up these probabilities, we actually get 104.3%. A difference of 4.3% in total. The 4.3% difference represents the aforementioned profit margin: the bookmaker earns a profit of 4.3% on every 100% (in units) being staked by the bettors.