Elo is a rating system first made for chess, and it works just as well for ranking hockey teams. Every team starts the season with a rating of 1500. After each game, the winner's rating goes up and the loser's rating goes down. The size of the change depends on how surprising the result was. Beating a much stronger team gains more points than beating a weaker one, and losing to a weaker team costs more points than losing to a stronger one.

Here's how AIHL Forecaster calculates its ratings. The home team gets a +35 point bonus before each game, since playing at home is a real advantage in hockey. A win in regular time earns extra points if the margin was large, up to a cap, so a blowout moves the rating more than a one-goal win. Overtime and shootout results only shift the rating a small amount, since both teams were still tied when regular time ended. Ratings are recalculated after every single game, so a team's Elo rating always reflects its most recent form, not just its overall record.