Win Expectancy (WE), otherwise known as Win Probability, indicates the chance a team has to win a particular game at a specific point in that game.
Expressed as a percentage, Win Expectancy is calculated by comparing the current game situation -- with the score, inning, number of outs, men on base and run environment all considered -- to similar historical situations. More specifically, the percentage is derived from the number of teams that faced a comparable situation in the past and went on to win the game.
Win Expectancy is the basis for Win Probability Added (WPA), which quantifies the percent change in a team's chances of winning from one event to the next. For example, if a team's Win Expectancy jumps from 30 percent before a home run to 70 percent after, the player who hit the homer would have a WPA of 0.40 for increasing his team's chances of winning by 40 percent.
Why it's useful
Win Expectancy is a "story stat" -- meaning it provides historical context to specific in-game situations.