Two picks, ten dollars, thirty back if both hit. Is that a good deal? Pick'em expected value answers it by weighing every possible net result by how likely it is. The lesson walks through the break-even math, which for that simple entry lands at one chance in three, then shows how small changes in your probability estimate flip a positive number to a negative one. You will build a payout tree that lists each settled outcome, attaches its return and sums it up. Along the way it flags the quiet mistake of treating picks as independent. Estimating the probabilities well is the hard part, and this lesson makes you test how fragile your answer is.
Learning objectives
- Understand and reconstruct the technique.
- Complete a numerical example and explain assumptions.
- Evaluate common failure modes without overclaiming outcomes.
