What is Expected Value (EV)?
Expected Value is a fundamental concept in gambling that tells you the average amount you can expect to win or lose per bet in the long run. The calculation weighs all possible outcomes by their probability of occurring.
The Basic Formula
Note: the loss amount is a negative number (e.g., -$100 for a $100 bet).
Simple Example:
You bet $100 on a coin flip at +100 odds (even money):
- Probability of winning: 50% (0.5)
- Potential Win Amount: $100
- Probability of losing: 50% (0.5)
- Potential Loss Amount: -$100
Result: This is a fair bet with zero expected value.
Why Expected Value Matters for Karma Betting
On the Real app, you want to find situations where Real offers better odds than fair value as determined from sportsbooks odds, giving you a positive EV bet.
Key Insight
Sportsbooks are generally more accurate at setting odds because they have more sophisticated models and pay for the absolute highest-frequency data. By using sportsbook odds to estimate true probabilities, we can identify when Real is offering favorable bets.
What are "No-Vig" Probabilities?
Sportsbooks build in a profit margin called "vig" or "juice." For example, both sides of a bet might have -110 odds. This would imply a 52.4% win probability for each side, totaling 104.8%. The extra 4.8% is the vig.
To get fair value probabilities, we remove this vig by normalizing the implied probabilities so they add up to 100%. The calculator does this for you; this is simply for informational purposes.
No-Vig Example:
Sportsbook odds: Over -110, Under -110
- Implied probability Over: 52.4%
- Implied probability Under: 52.4%
- Total: 104.8% (4.8% vig)
No-vig probabilities:
- Over: 52.4% ÷ 104.8% = 50%
- Under: 52.4% ÷ 104.8% = 50%
How to Use the Karma Betting Calculator
Choose 50, 100, 200, or 300 karma, depending on the maximum bet allowed by Real.
Input the odds offered by Real for both Over/Home Team and Under/Away Team. These are in American format (like +150 or -120). When no odds are displayed on Real, it is an even money wager (+100 for each side).
- Use the +/- buttons to quickly add signs
- Press Enter to move between fields
- Default values are +100 (even money)
Find the same bet on a major sportsbook (DraftKings, FanDuel, etc.) and enter those odds.
- Choose between American (+150, -120) or Decimal (2.50, 1.83) format
- Make sure you're comparing the exact same bet (same totals, sides, teams, etc.)
The calculator shows four different expected values:
- Max Bet EV: Expected value of betting your maximum karma amount
- Zero Bet EV: Expected value of making a zero bet.
The recommendation section highlights the best bet based on highest expected value.