What are the odds?
Let’s use a coin toss as an example of calculating expected value. Assuming the coin and the toss are fair, each outcome (heads or tails) has an equal probability of 50% - therefore the odds offered on a fair market would be 2.0 or even money.
This would result in an EV of 0 and a return of 100 (stake) for either a Head or Tail - because the probability of the two outcomes is the same, so if you tossed a coin infinitely it would theoretically end up all square so you would return 100% of your stake but no profit.
If for the same coin toss I offered you odds of 2-1 you would expect to double your money so you would have an expected value return of 200% including your stake.
Identifying value does not guarantee a profit short term, a fair coin toss could land on heads 20 plus times in a row although this is very unlikely. What it does mean is, if calculated correctly, the odds would be in your favour but patience is required.
The most common positive expected value is used within arbitrage (back to lay) , free bets and bookmaker offers.
The arbitrage strategy exploits odds from separate bookmakers and exchanges to form a positive EV which in most cases generates a small profit of around 5% or 105% including your stake.
The system we use calculates the expected value and ensures that at the time of the alert all tips are 105% or greater if they were used for arbitrage but using the other filters we have formulated we are able to increase that figure for outright betting to proven value ratings of 120% average across all services. A proven value rating of 120% for example would give you a return of 20% on your investment plus 100% stake returned.
If you placed 50 x £10 stake bets you would have staked £500
If the average rating for these bets was 120% PV you would make £100 profit with a total return including your stake of £600.