# Value Betting

Every Betfair Exchange punter who wins in the long-run shares a common characteristic: their challenge is to identify value bets at the Back & Lay odds.

They may bet on different sports and have different methods of identifying value, but they all know that, if they consistently find value and stake their wagers correctly, they’ll find success in the end.

### What is a Value Bet?

Value is one of the most misunderstood terms in betting. For many punters, it’s about Backing things at big odds. If your average punter talks about something “being a value bet”, it generally means they are Backing an outsider. Just because an outcome is 34.0 (2.94% Probability), doesn’t make it value. Not if it should be 150.0 (0.67% Probability) in the market.

For the record, value means Backing something that has a better chance than its odds imply, or Laying something that has less of a chance than its odds imply. It is Backing a coin toss at 2.5 when the correct price is 2.0. Or Laying at 1.67. You won’t win every toss – you’ll lose one in two – but if the return you get back when you do win is big enough, your long-term profit will be secured.

It is of course, not as easy to work out the odds an outcome should be when you’re talking about sporting events: deciding what odds Adam Scott should be in his next golf tournament is not as statistically straightforward as a coin toss.  Nonetheless, it dominates how Betfair winners think about punting.

This price-centric approach is different to the outcome-centric approach taken by most losing punters. How many times have you looked at a sporting event, decided who will win, then Backed that outcome no matter what the price? If the answer is, “every time I bet”, then you should reconsider your approach.

This might sound counter-intuitive, but a price-centric Betfair punter is not concerned primarily with finding a winner. Different to the method outlined above, they analyse an event and create odds they believe each outcome “should” be.

They then compare these expected odds with what is available in the Exchange market. If the price of an outcome is significantly larger than the price assessment when Backing, then that is the likely best bet in the race or event.

That word “significantly” is important. Recognising that sporting events are less concrete than a coin toss, even the best punter is going to have a margin for error in the odds they create.

For that reason it may not be good Backing a runner at Flemington at 3.20 (32.15% probability), just because you think they should be 3.18 (31.45% probability). Wait for the occasions where that same runner is 4.30 in the market, then you’ll have a value bet you can be more confident in.

*Remember you can place your own odds in on the Back and Lay side on the Exchange. If you want some added value in the odds, place the odds you desire for a high value bet on the Lay or Back side and they may get matched.

### Margin in Value Betting

Working out exactly what margin you are looking for comes with experience, as you refine your betting strategy by analysing winning and losing bets, you will become more certain of what represents a value bet for you.

Often, punters struggle at first to create their own prices. A helpful tip when you start is to ignore the odds, but to simply put the various outcomes in order, from most likely to least likely. If you can then work out what you think the odds of one of those outcomes should be, the rest will start to fall in to place.

So, before your next bet, create your own list of prices first. What odds should these outcomes be?  When you have your answer, only then should you look at the market. Resist betting unless the odds are in your favour. Be okay if you “miss” a winning bet when the odds weren’t right. Make this mental shift in how you punt and you will be taking a giant leap towards becoming a successful punter.

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