Lesson description
Experienced blackjack and poker players mention expected value (EV) often, but what does it mean? Mr Blackjack shows how EV can be crucial towards measuring your long-term performance.
We hear expected value, or EV, mentioned a lot in poker, but it also appears in blackjack. All players should be aware of EV, as it helps you measure your winnings over time.
What is expected value (EV)? It is the long-term result of a decision based on a particular situation. In simple terms, it is the expected total you will win or lose when you play. The key thing to remember is that this is the long-term result.
For instance, expected value says if you played a hand 100 times and you made a specific decision, the odds state you would expect to win 40% of the time.
You should always decide with the highest EV, even if your gut tells you otherwise. Your decision should always be based on basic strategy in blackjack.
The math has already been calculated for you and will tell you exactly which decision will give you a positive expected value.
So, in practice: say you have 13 against a dealer 10. You have two choices: hit the 13 or stay on the 13. If you stay (we call this 'stay and pray' by the way), your expected odds of winning, or EV, is 32%.
If you hit, your chances of winning the hand go up to 36%.
Granted, this is not an excellent situation for you. However, you must make the proper decision based on the expected outcome of not only this hand but the next 100 hands like this.
And if you play consistently using basic strategy, the math will even out and make you a winning player.
To put this into perspective: if across 100 hands you are betting $20 per hand and you are making choices that reduce your EV, it can change your odds by 7.5% on average, depending on the situation.
Over the 100 hands played, you will win some because you got lucky, and you will lose hands for the same reason. But the math always evens out in the long run, and those bad decisions you make will cost you $150 more on average than if you would have played correctly.
You're probably wondering why we should care about expected value. Casinos do because it is how they make their money.
If you don't use any basic strategy or card counting, the casino's advantage is just over 50% in blackjack. So, if you go to the casino and get lucky at the tables at first, the casino won't mind.
They know you'll keep playing in hopes of winning more, and eventually, they will win back any money they initially lost in the long run.
If you're using basic strategy and card counting, you can reverse the casino's edge in your favor. Expected value will tell you how much you can win in the long run, depending on your skill. This is why all skilled blackjack players need expected value.
