Beginners and experienced bettors, in search of reliable methods to play against bookmakers, occasionally use overestimated odds. Betting using such odds is known as Value Betting.
The Essence of the Value Betting Strategy
The essence of “Value Betting” lies in placing wagers on outcomes where the bookmaker’s odds are lower than the team’s real chances of success. The real probability is determined by the player based on their own analysis of the teams’ performance and statistics.
“Value bets” appear for several reasons:
- due to a bookmaker’s error when compiling the betting line;
- as a result of an incorrect analysis of a sporting event by the bookmaker;
- because of odds drift (“market overload”) and delayed reaction by the bookmaker.
Pros and Cons of the Strategy
Value betting has both positive and negative sides.
The Cons of value betting include:
- the need to spend considerable time analyzing teams’ or athletes’ chances in upcoming events;
- the absence of a 100% guarantee of success for such bets.
Formula for Value Bets
Experienced bettors use the following formula when applying the Value Betting strategy: K × P > 1, where:
- K — the bookmaker’s odds;
- P — the bettor’s own assessment of the probability of the outcome.
Example of Calculating a Value Bet
A bookmaker assesses the chances of PSG and Juventus in a hypothetical Champions League playoff match as favoring the French team, offering odds of 1.50 (for the home win) and 2.10 (for the Italian win). The bettor estimates Juventus’s chances of winning at 50%. The calculation using the formula gives: 2.1 × 0.5 = 1.05. Since 1.05 > 1, the bet on Juventus’s victory is considered a value bet.
