What is a Value Bet?

Value betting is the key to long-term success in sports betting. This guide explains what a value bet is, how to calculate expected value, and why consistently betting with an edge leads to profit. With clear examples and simple math, you'll understand how to bet smarter.

Value betting is the foundation of profitable sports betting. Unlike guessing or relying on luck, value betting uses mathematics to identify bets that offer long-term profitability.

This guide will walk you through what a value bet is, how to calculate expected value, and why this approach works over time.

What is a Value Bet?

A value bet is a mathematically profitable bet. A value bet occurs when the odds taken imply a lower probability than the real probability of an outcome.

It's a mathematically profitable spot, commonly referred to as a positive expected value (+EV) bet.

Here's why value betting works:

• The goal isn't to win every time, it's to beat the odds consistently
• It relies on long-term results, not short-term luck
• You're exploiting market inefficiencies before they correct

Unlike an arbitrage bet, you are not guaranteed to make money on any one value bet. But over a statistically significant sample size, you are almost guaranteed to profit from consistently placing value bets.

For more information on the difference between value betting and arbitrage, see our arbitrage betting guide.

Value Bet: Coin Flip Example

We all know a fair coin has a 50% chance of landing on heads and a 50% chance of landing on tails when flipped.

This simple example helps illustrate how value betting works with clear probabilities.

Calculating Expected Value: First Attempt

Now let's imagine your friend has offered you odds of -120 (1.83 in decimal format) for the coin landing on heads. What we need to do is figure out whether this is a value bet or not.

If it is a value bet, then we should accept his offer. If it isn't, then we shouldn't.

A value bet will have what we call in mathematics positive expected value. A non-value bet will have neutral or negative expected value.

Here is the formula for expected value:

Expected Value = (Probability Of Winning × Profit) - (Probability Of Losing × Stake)

So, let's imagine for a second that we accepted our friend's offer and placed a $10 bet on the odds of -120 (1.83). What is the expected value of the bet?

We know the probability of the bet winning (landing on heads) is 50% because the coin is fair, so we would input:

(0.50 × profit) - (Probability Of Losing × Stake)

Calculating the Profit of the Bet

The next step, which is calculating the profit of the bet, can be a bit confusing when using American odds. The formula is slightly different depending on whether the pick is a favorite (-) or an underdog (+).

Here's how you go about each:

For an underdog (+):

• Divide the stake by 100
• Multiply the result by the odds to calculate the profit

For a favorite (-):

• Divide 100 by the odds
• Multiply the result by the stake — that's the profit

So let's get back to our bet and calculate the profit using what we've learned above. Remember we've been offered favorite odds (-120), so we need to divide 100 by the odds and then multiply the result by the stake:

(100 ÷ 120) × $10 = $8.33

Now we know the profit, we can input it into our expected value formula:

(0.50 × $8.33) - (Probability Of Losing × Stake)

Calculating the Probability of Losing

The next input to calculate is the probability of losing. Again, we know that the coin is fair, so the probability of it landing on tails and therefore us losing the bet is 50%.

So we can go ahead and input that:

(0.50 × $8.33) - (0.50 × Stake)

The last input is our stake. If you remember, we staked $10, so let's finish off the calculation with that input:

(0.50 × $8.33) - (0.50 × $10)

= -$0.84

Oh no! This bet has a negative expected value of -$0.84, meaning we would expect to lose that much per bet if we placed it over and over again.

Luckily we took the time to calculate the expected value before placing the bet for real.

Counter Offer: What if the Odds Were +120?

Now we know not to accept the bet at odds of -120 (1.83). Let's imagine we counter offer our friend with odds of +120 (2.20 in decimal format) and he accepts. Would this be a value bet for us?

For an underdog bet at +120, the profit calculation is different. We divide the stake by 100 and multiply by the odds:

($10 ÷ 100) × 120 = $12

Now let's calculate the expected value:

(0.50 × $12) - (0.50 × $10)

= +$1.00

Yay! The expected value is +$1.00, meaning we would expect to profit $1.00 off each bet if we placed it over and over again.

Unfortunately, the reality is you won't be able to find any value bets on coin flips because that would be too easy! You can, however, find plenty of value bets on sports.

Popular sportsbooks often accidentally offer bets that have positive expected value for the player. The math is exactly the same; it's just the context is different.

Let's now look at an example of a value sports bet.

Value Bet: Sports Bet Example

As we already know, we need to know the probability of the bet winning in order to calculate expected value. As a reminder, here is the expected value formula:

(Probability Of Winning × Profit) - (Probability Of Losing × Stake)

Calculating probabilities was very simple for our coin flip example because we know that a fair coin lands on heads 50% of the time and tails 50% of the time.

It is not so easy when it comes to sports bets because the true probability of an event occurring, like a team winning, is much harder to calculate.

For the sake of staying on track, let's just assume we know for sure that the probability of Team A beating Team B is 55%.

Below you will see that a sportsbook is offering us odds of -105 (1.95 in decimal format), which have an implied probability of 51.20%.

Let's calculate the expected value of a $10 bet at odds of -105 (1.95) using our assumption that Team A has a 55% chance of winning:

First, calculate the profit: (100 ÷ 105) × $10 = $9.52

Now calculate expected value:

(0.55 × $9.52) - (0.45 × $10)

= +$0.74

The sportsbook is unknowingly offering us a value bet, so we should take them up on the offer by placing a bet!

Why This is a Value Bet

You might be thinking that "that's all well and good, but how am I supposed to calculate the true probability of Team A beating Team B? Doesn't that require a bunch of data and complex calculations?"

You might also be thinking "no bookmaker is ever going to be dumb enough to offer me value bets!"

You would be wrong in both instances. You don't need to do any data crunching yourself, and you would be surprised how often bookmakers get things wrong.

Tools like FairOdds Terminal can help you identify value bets by comparing odds across multiple bookmakers and calculating expected value automatically.

You can also use our expected value calculator to quickly determine if a bet has positive expected value.

Why Value Bets Matter in the Long Run

Value betting is not about winning every bet. In fact, even profitable bettors can lose several bets in a row.

What makes value betting effective is consistency and volume over time.

In the short term, results are influenced by variance. You might win or lose due to luck. But over the long run, if your bets have positive expected value (+EV), the math will work in your favor.

Here's why long-term thinking matters:

• Short-term losses are normal and expected
• Profitability comes from placing many +EV bets, not just a few
• You can lose more bets than you win and still make money
• Long-term results reflect the quality of your edge, not streaks

Think of it like a casino. Each game has a small edge, and over time, the house always wins. With value betting, you become the house.

Track your bets, stay consistent, and let the edge do the work.

For more information on managing variance and understanding long-term results, check out our variance in sports betting guide.

Putting Value Betting into Action

So far, we've explained what value betting is alongside real-world examples to help you understand how it works.

Value betting is not about luck or gut feelings. It is about math. It is a numbers game built on long-term discipline and consistent decision-making.

You will not win every bet, and that is okay. What matters is betting when the odds are in your favor and the expected value is positive.

The more positive EV bets you place, the more your edge shows over time.

Ready to start finding real value bets? Check out our complete value betting guide for more advanced strategies and techniques.

You'll learn exactly how to find value bets without having to do any complex math yourself, using proven strategies and tools.

Ready to find value bets automatically? Use FairOdds Terminal to scan hundreds of bookmakers and identify value betting opportunities with positive expected value in real-time.

FAQs about Value Betting