First, the Value Bet is independent and thus not related to the Predictions. While the Predictions evaluates the probabilities of game events, the Value Bet is processing thousands of historical odds data and market trends to find Value opportunities, compared against bookmakers odds. Once the opening odds are available, the value detection algorithm is running every 10 minutes up to the beginning of the match. Each value detected by the model is coming with a set of features I will describe below.
The stake feature
Each of the Value Bet detected by the model has a stake. The stake is helping to manage the risk that the model would take in the bet. It is somewhere between the Kelly (1) bet and the Markowitz (2) theory. The risk is measured with the volatility of the profit and loss of the Value Bet Strategy. The stake is calculated in order to have an average risk of one unit (it could be one euro, one dollar…) In order to illustrate this, let’s assume one always bets on an event which has 20% of success. The fair odd in this case is 5. If your stake is 3 units, this is mean that in 20% of the time your profit is 12 units and in 80% of the time your loss is -3 units. The volatility and thus the risk of the profit and loss is 6 units in this case. The Value Bet gives for each value detected the stake that will give you a volatility of 1 unit if the match was played multiple times. This way you own the same risk for every Value found. The maximum allowed stake is 5 units. But it is important to keep this scale the same. If you want to take a risk of 2 (or any number) units in average, you just have to multiply all the stakes by 2 (or any number). In this case the maximum stake will be 10 units.
Introducing the fair odd feature
Our algorithm allows you to find the fair odd of a value. The fair odd is useful to play against bookmakers that are not listed in 1×2.Expert. Any odd above the fair odd can be considered as Value. In the previous example (fair odd = 5), any odd offered by a random bookmaker above 5 should be taken for a bet.