Anyone can visit a sports bookmaker like Ladbrokes Sports or Paddy Power Sports and put a bet down on their favourite football team; it takes very little thought, analysis or strategy. Indeed, the vast majority of football bets are made on the back of an individual’s loyalty to a particular team. However, over the course of a season, it doesn’t make any financial sense to blindly back your preferred team simply because they’re playing. Instead, before the English football leagues resume in August, try to get to grips with the premise of ‘value’.
Essentially, 'value' is determined by assessing what you think are the chances of a team’s victory against the prices that bookmakers are offering on that result. If you think a team has value, it is because you think the rewards of betting on them to win outweigh the risks.
You can work out a team’s value for any given match very easily, by following this method:
So, if we were to take an example of this, let’s look at the recent Euro 2012 competition and the semi-final between Italy and Germany. Bookmakers before the match believed there could only be one winner; Paddy Power Sports were offering Germany at 10/11 and Ladbrokes Sports at 8/10. They had Italy to win at 7/2 and 15/4 respectively.
A lot of inexperienced punters would have viewed these odds and immediately thought twice about backing Italy. However, others will have looked at those prices and immediately seen a window of opportunity.
If we take the best odds proffered for an Italy win, the 15/4 offered by Ladbrokes Sports converts to 4.75. At that price, you only had to estimate that Italy had a 22% chance of winning the game to find value: 0.22 x 4.75 = 1.05.
That’s the equivalent of Italy winning the game only once if it was played five times over. Some German fans may have agreed with this assessment; the Germans were the only side in the competition to win all three group matches, had dismissed Greece in the quarter-final in some style and had the most in-form striker of the tournament in the form of Mario Gomez. Indeed, Germany were joint favourites with Spain to lift the trophy.
However, Italian fans would have looked at their side’s well-earned point against Spain, their steady progression through the group stage and a dominant display against England in the quarters. Despite the naysayers, Italy were unbeaten and looked dangerous in attack, particularly with Andrea Pirlo on top form.
All of these things will have been assessed by seasoned punters, and the more insightful will have concluded that backing Italy had value in it every single time. In the event, Italy won 2-1 in a virtuoso performance that merited much more the long odds given by Ladbrokes Sports and Paddy Power Sports before the game.