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How to identify value in your bets? That is the big question. My friend, Alex Napier who operates the top Bet Soccer website, has asked me to write this article to explain how bookmakers’ percentages are calculated and just how they supply a guide to assessment of value in the odds on offer. He has asked me to look at soccer betting, where, as a result of the few possible outcomes (three choices – win, lose or draw) the odds offered are short in any event.
A perfectly “balanced book” where the odds offered exactly reflect the possibility of each team winning or the draw would produce an overall of 100.00%. Theoretically the bookmaker will profit by the total percentage on the match less 100.00%. In the above table bookmaker 1 should profit by 11.89% of turnover on the match and bookmaker 2 by 11.23%. At first sight there does not seem to be much between them but as we compare the theoretical profit of each the margin on visit the following website page bookmaker 1 odds (i.e. 111.89 – 100.00 = 11.89%) is 5.84% higher than the 11.23% margin on the bookmaker 2 odds! Where the odds on offer produce a theoretical profit for the bookmaker the book is said to be “over round”. The bookmaker 1 book is over round by 11.89% and also the bookmaker 2 book by 11.23%.
Where the odds on offer total less than 100.00%, which never actually occurs with the odds provided by anyone bookmaker as they would in theory be certain to lose on the event, they can be “under round” . The losing percentage will be 100.00% less the total odds percentage. Not surprisingly this will not happen. Individual bookmakers do not offer odds on the possible outcomes that might give them a loss. What does happen, although very infrequently, is that the odds offered by a selection of bookmakers can vary to the extent that one can locate a combination where those for the three possible outcomes are under round. This means that you can bet on all three possibilities – win, lose and draw – and provided you allocate your total stake in the correct proportion you is likely to make a profit of the percentage by that you just can bet at under round odds.
Identifying value
From the above mentioned data it’s fairly obvious that the 4 – 1 offered by bookmaker 1 in respect of the home team winning is the greatest price, there isn’t any difference in the odds offered for the draw but bookmaker 2 offers the most effective odds for the away win. The question then arises, which is the best value? Obviously the 20.00% provided by bookmaker 1 on the home win will be the lowest percentage so may very well be the very best value, but this really is too simplistic. There has to be a yardstick to measure the odds against. That’s your own assessment or your advised assessment of the possibility of each outcome. If you give each possibility your own percentage rating you can compare this with the bookmaker odds percentage to establish where the value lies. How you study the probability of each outcome is not for this article. It deserves more in depth treatment than can be given here where we are addressing bookmakers’ margins and value bets.
Assuming that the true reflection of the chances on the above match were home win 20% (bookmaker 1 had that about right and bookmaker 2 was under priced), a 20% chance of a draw (although these were the bookmakers offering the top odds on the draw they were still under priced) and a 60% chance of an away win (where bookmaker 2 quotes a price that gives a lower percentage chance so offers value) consideration should be given to an away win bet with bookmaker 2.
Stake allocation
There may be occasions when it truly is necessary to allocate your stake between different outcomes. This could be the situation where a selection of bookmakers odds produce an under round opportunity or where there is a strong reason to include 2 of the three possible outcomes so it’s necessary to allocate the stake between them. In the illustration below the odds happen to be exaggerated. It is rather seldom in reality that an under round opportunity arises although the illustration is the best one to show how exactly to use percentages.
It is generally obvious which bookmaker is or bookmakers are offering the most effective odds. All you need do is compare them. Identifying value is another matter. Because of this you need to calculate the odds percentages to compare with your own, or your advised, perception or assessment of the probability of each outcome. By comparing the available percentages with your assessment you can identify where the value lies and make your selections accordingly – and perhaps now and again identify a no lose position where a selection of the odds provided by the different bookmakers produce an under round position! Disciplined utilization of percentages should form a major part of your strategy in identifying value within the odds offered and contributing to your betting profits.
