How to beat the bookies – a value betting guide (inc. spreadsheet)

[Jenspm]

I know most of you are familiar with the concept of bet value, but I thought I’d make a short guide on exactly how you can find these value bets. First of all though, I must explain what value is and the importance of it.

As you can read in my signature, value is defined as “the amount that is considered to be a fair equivalent for something else”. In betting, a fair price is a price, or odd, that represents the correct percentage of the outcome that is bet upon. To find out what percentage the odds you take represent, simply divide 100 by the decimal odds. Odds of 2.0 imply a probability of 100/2 = 50%, while odds of 5.0 imply a probability of 100/5=20%. If the odds on a team are 5.0, but you think the chance of them winning is higher than 20%, then it’s a value bet, and always worth backing. If you think Barcelona has an 80% chance of beating Mallorca, but the odds are at 1.20, it is not a value bet, and never worth backing. Sure, there’s an 80% chance that you’ll profit on the match, but if you keep taking bets like this, you will ALWAYS lose money in the long run. As a matter of fact, value betting is the only way to ensure a long-term betting profit.

So, how do you figure out if a bet is value? Well, there’s only one way to do this correctly, and unfortunately, it’s quite a time-consuming procedure. But hey, we’re in it for the money aren’t we? Once you’ve gotten the hang of this technique, you’ll see your profits steadily rise, and you’ll become what one would call a “consistent punter”. What we’re going to do is compile our own odds, and try to beat the bookies (or other betters on an exchange), and therefore secure a long term profit. It’s hard to make accurate predictions – it’s impossible to get it perfect, what with all the factors that are in play. However, you can get pretty accurate in the end, and get an advantage over the bookie especially if you have knowledge of an obscure league, like a Romanian 3^rd division, or down into the Blue Squares in England. In any case, this process will force you to look more into your bets, and ensure that you have more quality bets.

Now, onto the actual odds compiling. First of all, you cannot do this accurately based on only statistics. With enough work and a good system you can get pretty damn close, but not close enough for our liking. You have to have good knowledge of the league in question, and should consider the following factors, in addition to home/away records and pure class:

· Form

· Motivation

· Injuries

· Recent events around a team (manager fired, etc)

· Other factors.

However, at least when starting compiling odds, I feel the home and away records of the two teams are a great starting point. Here you simply find the home team’s percentages of wins, draws and losses at home, and the away team’s percentage of wins draws and losses away. To find the percentage, you divide the amount of wins by the total number of games, for example. So, an example:

Home team at home: 6-2-3

Away team away: 2-4-5

That gives the home team percentages of: 55 – 18 – 27

And it gives the away team percentages of: 45 – 36 – 18

(Note that I turned the away teams record around, 45 represents the chance of the away team losing = 5/11)

You then find the average of those to percentages, by adding them up and dividing by two. That gives us the following percentages: 50 – 27 – 23

There we have it – a nice base. Now we must apply the points noted above – form, motivation, injuries, recent events, etc, and adjust those percentages. How much those factors play in is hard to decide, but it’s something you’ll have to experiment with. Once you’re finished, divide 100 by the numbers you have gotten to get your take on the decimal odds. The bookies do exactly this every time they put up odds, and your goal is to create odds more accurately than them. So basically, if your odds are lower than his, it’s worth a backing. Else, stay away.

Bet value can also be represented by a number. To find this number, simply multiply your percentage chance by the bookies odds. Anything over 100 = value. Example: Chance of 51%, odds of 2.0 => 51 x 2 = 102, the bet value is 102% and worth backing. When compiling your first odds, it’s important to remember: at this stage, the bookies are most likely better than you. So, if you differ too much from the bookies (value over 115% is usually wrong), adjust it. Anything over 110% and you need to double check everything. HOWEVER: you can be correct in your 115% bet value, so if you’re certain in your analysis, don’t change it just because the bookies are pricing it higher than you.

Staking

The most popular staking plan out there that works based on bet value is called the Kelly Criterion. I’m not going to go into detail about this system, but you can read more about it here: http://en.wikipedia.org/wiki/Kelly_criterion . Warning: it does recommend using a large portion of your bankroll, and you need to have pretty damn accurate percentages if you don’t want to go bankrupt. I personally use a staking plan based on Kelly, where I use a points system instead of percentage. Ie, if it recommends a 5% stake, I stake 5pts. Anything over 10% = 10pts.

I have attached an Excel sheet that I have created myself, and recommend the download (sorry it's a .zip, I don't think the forum allows .xlsx). Basically, you plot in your 1X2 percentages for up to 8 games at a time, as well as the bookie’s odds, and it automatically shows you “your odds”, bet value, and recommended stake according to the Kelly Criterion. It also does Asian Handicaps. If you want anything else added, feel free to ask.

The table on the Excel sheet’s first page can be copied into the forum to easily show fellow forum users your take on fair odds for the game. I hope this starts a trend of people actively seeking value on these forums, as that is, imo, the only way to bet for long term profit. Please, feel free to ask should there be any questions, or report any bugs or requests with the Excel sheet.

Happy Betting!

[Jase82]

Re: How to beat the bookies – a value betting guide (inc. spreadsheet) Great post Jens :ok I agree, you have to be searching always for that little bit of edge. I've always struggled with staking though, which is something I'm looking at in greater detail for next season.