Expected Value (EV) Calculator

How expected value works

On a prediction market the price is the market’s probability. You only have an edge when your own estimate q differs from the price p. For a $1 contract, the expected profit per contract is simply q − p — buy at 55¢ when you believe the true chance is 65% and your edge is 10¢ per contract, on average. The calculator scales that across the contracts your stake buys to give the total expected value and ROI.

Reading the result

A positive expected value means the trade is favourable over the long run; a negative one means you should pass, however tempting the market looks. Remember the average hides the variance: a +EV trade can — and often will — lose outright on any single occasion, which is exactly why bankroll management and sensible position sizing matter. For where genuine edges come from, see how to find value.

Once a trade clears the EV test, size it with the Kelly calculator and check the payoff with the profit calculator.

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Frequently asked questions

What is expected value in trading?

Expected value (EV) is the average profit you would expect across many similar trades. For a $1 contract bought at price p with true probability q, the EV per contract is q - p. A positive EV means the trade is favourable on average.

What does a negative EV mean?

It means the price is higher than your estimated probability, so the trade loses money on average over the long run. However tempting the market looks, a negative-EV trade is one to pass on.

Does positive EV guarantee a profit?

No. EV is a long-run average, not a prediction of any single result — a positive-EV trade can and often will lose outright on any one occasion. That is why bankroll management and position sizing matter.