Increased Profits for Online Sportsbook Gambling – Having the hope and desire to be able to win and benefit from playing sportsbok is certainly the desire of all players.
The concept of “Expected Value” is a key concept for market traders and more specifically for this article and our expertise, Sports Investing – exploitation of the sports investment market for profit opportunities.
Expected value is what keeps professional black jack players playing when they are in the 200,000 “hole”. This expected value is what makes professional judi bola gila sports bettors bet when they are 2-8 in their last 10 positions. The expected value is how hedge funds create algorithms to take advantage of price movements in the stock and futures markets.
So, in layman’s terms, what is Expected Value?
EV is the money you expect to statistically win (or lose) by participating in any “event” – whether a hand of poker, a spin of the roulette wheel, or betting on a sporting event. This is your mathematical advantage (or disadvantage) in a game of chance and skill. This is an advantage that casinos take advantage of to gradually take money from you while playing games such as roulette, craps, slot machines, and continuous multi-shuffle blackjack.
Let’s take a simple example using dice – something that everyone is familiar with.
Obviously the dice has 6 numbers printed on it, in statistical events this is called the “result”. 1, 2, 3, 4, 5, & 6. So we have six possible outcomes. Each roll of the dice gives us an outcome with a “one in six” chance because they are all the same.
To calculate the expected value, we need probability, so let’s calculate the probability of a single number appearing. 1/6 = 0.166
We can multiply each outcome on the dice (1 to 6) by its probability to get the expected value.
1 x 0.1667 + 2 x 0.1667 + 3 x 0.1667 + 4 x 0.1667 + 5 x 0.1667 + 6 x 0.1667 = 3.5
This number can then be used in a game of chance to calculate who has the advantage in the dice gambling game.
Suppose the casino is willing to pay us an amount that matches the numbers on the dice (like you roll 2, you win $2 and so on) – with two caveats:
1) our bet must be $3 and 2) if we roll a 6 we lose our bet. Is this an interesting game for us to bet on?
In this game we have 5 favorable outcomes with equal probabilities, but with unequal outcomes.
To get the expected value, we calculate the game’s return by calculating the expected value – which is basically the average return. We use probability multiplied by return.
So we have 5 options that give us financial returns:
0.1667 x 1 + 0.1667 x 2 + 0.1667 x 3 + 0.1667 x 4 + 0.1667 x 5 = 2.5
and one pay loss for rolling 6 (zero returns): 0.1667 x 0 = 0
Together we have:
0.1667 x 1 + 0.1667 x 2 + 0.1667 x 3 + 0.1667 x 4 + 0.1667 x 5 + 0 = 2.5
Since the cost of playing the game is $3, we have a 100% probability (probability 1) of paying $3 to play, represented by -3 x 1 = -3
adding this to the equation yields: -3 + 2.5 = – 0.5.
So for every game played with a spend of 3, we can expect to lose 50c as the Expected Value. Of course when playing we will win some games by rolling 4 or 5, and some games we lose a dollar or two, but with negative expectations of profit this is a typical casino game – a “negative expectation” game.