1. ## Expected Value

I've just finished my maths A-Level (I'm British) and one of the topics we covered was the Expected Value of a random variable. I was wondering if this was applicable to sports betting. For example:

Odds my sports team will win are 4:1 against.

Probability will win: 1/5, return of a £1 bet is 5

Probability will lose: 4/5, return of a £1 bet is -1

Expected value is: 0.2

Is this approch applicable?

2. Originally Posted by Killswitch
I've just finished my maths A-Level (I'm British) and one of the topics we covered was the Expected Value of a random variable. I was wondering if this was applicable to sports betting. For example:

Odds my sports team will win are 4:1 against.

Probability will win: 1/5, return of a £1 bet is 5

Probability will lose: 4/5, return of a £1 bet is -1

Expected value is: 0.2

Is this approch applicable?
The expected value is 0. When you win, the return is -1 + (1+4) = 4. That is, you first give them 1, then they return the 1 plus 4 more.

3. Ah, you're right about that, my original question stills stands - can you apply expected values to sports betting?

4. Originally Posted by Killswitch
Ah, you're right about that, my original question stills stands - can you apply expected values to sports betting?
Yes, the outcome of a wager is a random variable which is bounded and which therefore has an expected value.