In the realm of sports betting, gaining a competitive edge is all about understanding odds, pricing and recognizing value. One crucial concept that sharp bettors must grasp is "de-vigging." This process removes the bookmaker's margin (known as vig or juice) to reveal the true probabilities of events. By calculating true odds, bettors can make informed decisions and spot lucrative betting opportunities. In this guide, we will outline three effective methods to de-vig and calculate expected values (EV) in sports betting.
TrueOdds Pro does this for you, but it's good to understand the basics as a sharp.
What is Vig?
To be a sports betting sharp, it's essential to know what vig is. The vig, vigorish, or juice, is the commission that bookmakers charge on bets. It ensures that they make a profit regardless of the game's outcome.
For instance, when a bookmaker sets odds of -110 on both sides of a bet, a wager of £110 is required to win £100. In this scenario, the extra £10 is the vig. By learning how to eliminate this from calculations, bettors can uncover true odds and refine their betting strategies.
Method 1: The Simple Odds Conversion
The first method for de-vigging is both simple and powerful. By converting American odds into implied probabilities, bettors can quickly strip away the vig. Here’s a step-by-step guide:
Convert American odds to implied probability:
For positive odds: Implied Probability = 100 / (Odds + 100).
For negative odds: Implied Probability = -1 * (Odds / (Odds - 100)).
Sum the implied probabilities of all possible outcomes.
Adjust the probabilities by dividing each individual implied probability by the total sum from Step 2.
Calculate the true odds from the adjusted probabilities.
For example, if you see odds of -120 for Team A and +100 for Team B, converting these gives you:
Team A: 54.55% implied probability (1 / (1 - 0.54))
Team B: 50% implied probability.
If the total implied probabilities sum to 104.55%, you would divide each by 1.0455 to find the true probabilities, giving better insight into which team offers value.
Method 2: The Percentage Method
This second method is effective, especially when analyzing events with multiple outcomes, like horse races or tournaments. Here’s how to utilize it:
Convert odds to implied probabilities as outlined in Method 1.
Calculate the total implied probability of all outcomes.
Divide each implied probability by the total to find the percentage for each outcome.
Remove the vig by subtracting the total implied probability from 100%. This gives you the effective vig.
Re-calculate true odds by converting adjusted percentages back into decimal odds.
For instance, in a race with three horses, if the total implied probability is 130%:
You divide each individual probability by 1.3 to find adjusted probabilities.
If Horse A started at 60%, it would adjust to approximately 46.15%, reflecting true value.
This method helps you understand the distribution in events with various possible outcomes.
Method 3: The Line Movement Analysis
The third method focuses on analyzing line movements, offering a deeper look into betting behavior. Changes in line can signal shifts in public perception and can reveal where the true value lies. Here’s how to apply it:
Monitor initial lines released by bookmakers and track changes over time.
Observe public betting trends; significant line shifts often reflect where most people are betting.
Analyze line movements based on relevant factors, like injuries or weather changes.
Assess whether a movement is driven by public sentiment or actual underlying probabilities.
Recalculate true odds based on adjusted lines.
For example, if a team's line moves drastically after a star player is ruled out, this information can shift your perception of that team’s true chances, allowing for informed betting.
Calculating Expected Value (EV)
Once you’ve de-vigged and calculated the true odds, the next crucial step is finding the expected value (EV) of your bets. EV estimates what you can expect to win or lose over time per bet. Here's how:
Use the formula:
EV = (Probability of Winning Amount Won per Bet) - (Probability of Losing Amount Lost per Bet).
Substitute the true probabilities you derived from previous methods.
Evaluate the EV for different betting opportunities, choosing those with a positive EV as your targets.
For example, if your analysis shows a 60% probability of winning a bet to win £100, with a 40% chance of losing £100:
EV = (0.60 100) - (0.40 100) = £20.
Understanding EV is vital for becoming a successful sports bettor. It provides a framework for evaluating different betting options based on calculated risks.
Maximizing Your Betting Strategy
Mastering the art of de-vigging and true odds calculation is a game-changer for serious sports bettors. By leveraging the simple odds conversion, percentage method, and line movement analysis, you can eliminate the bookmaker's margin and uncover true value in potential bets. TrueOdds takes this a step further and uses a proprietary method to de-vig based on the market under analysis.
Moreover, knowing how to calculate expected value allows you to make informed wagering decisions. This combination of techniques elevates your betting approach from mere luck to strategic planning.
Take out the guesswork and calculations. Get the edge today with TrueOdds Pro.