What is value betting?

Imagine you were to bet on the toss of a coin. Assuming the coin can’t land on its rim, there is a 50 % chance of heads, and 50 % chance of tails. Now, imagine you were to bet on the outcome, and had two people offering you the following odds: 2.10 Heads & 1.80 Tails.

This article explains what expected value is. Obviously, you choose the bet with the highest odds, since the probability of each outcome is the same. Now, let’s see what happens if you place a bet on heads at 2.10. Half of the time, you’ll lose your $10 bet, and half of the time you’ll earn $11. From
this, we can calculate the expected value of your bet to be $0.5.

Read more here.