How to Calculate Betting Edge

Your edge is the difference between your model's true probability and the sportsbook's implied probability. A positive edge means your model believes the outcome is more likely than the odds suggest.

Edge = Model Probability - Implied Probability Or expressed as percentage: Edge % = ((Decimal Odds × Model Probability) - 1) × 100 Example: Odds = 2.10, Model Probability = 52% Edge = ((2.10 × 0.52) - 1) × 100 = (1.092 - 1) × 100 = +9.2%

1. Get sportsbook odds (e.g., 2.10 for Team A win) 2. Calculate implied probability: 1/2.10 = 47.6% 3. Run your model, get true probability (e.g., 52%) 4. Subtract: 52% - 47.6% = +4.4% edge This is a +4.4% edge—worth betting if it meets your threshold.

These are different metrics: - Confidence: How sure your model is (probability itself) - Edge: The discrepancy between your probability and the odds A 80% favorite might have 0% edge if the odds are fair. A 52% underdog might have +5% edge if the market undervalues them. Bet the edge, not the confidence.

If you consistently bet with +2% edge, your expected ROI is +2% over time. It doesn't matter if you win or lose individual bets—what matters is accumulating positive edge bets. The law of large numbers ensures your results converge to your edge.

Different bettors use different minimum edge thresholds: - Conservative: Only bet edges of 8%+ - Moderate: Bet edges of 5%+ - Aggressive: Bet edges of 3%+ Higher thresholds mean fewer bets but more selective opportunities. Lower thresholds mean more volume but smaller edges.