Betting Odds Explained

Author: Yan Zhylinski

Betting odds are numbers used by bookies to show the likelihood or probability of an outcome occurring. They indicate how much money you can expect to get on a winning bet. This guide introduces you to the world of odds, including their types and how they work.

Betting Odds Explained

Types of odds

There are three main types of odds used by online bookmakers

  • Fractional
  • Decimal
  • American

We will look at each one of them in detail and learn how they work.

How Betting Odds Work

Understanding betting odds can be confusing in the beginning, but it becomes clear once you grasp their concept. In essence, they are expressed as either decimal odds (e.g. 4.0) or fractional odds (e.g. 3/1). When you understand the difference between them, it becomes easy to read betting odds. Traditionally, fractions were used in horse racing betting before the advent of online gambling. Decimal odds have become more popular with the growth of an online gaming market. You may also find American odds in the US bookmakers, usually expressed as negative and positive values (e.g. -400, +250).

Understanding Fractional Odds

If a bookmaker offers odds of 3/1 for a certain match result, it means you stand a chance to earn £3 for every £1 you bet. In case the bookmaker offers 10/2 odds, you win £10 for every £2 you bet. Some fractional odds may also be expressed with a smaller first number e.g. 2/7 or 1/2, also known as ‘odds-on selections’. They are used when the likelihood of an outcome is higher than not. Such odds mean that you earn less than your stake. For instance, in 2/7 odds, you win £2 for every £10 you wager. In some cases, the numbers on both sides of the slash are equal e.g. 2/2 or 1/1. They are known as evens meaning that you win an amount equal to your stake.

Understanding Decimal Odds

The decimal odds are easier to understand. To calculate your potential winnings, you just need to multiply your stake with odds. For instance, if a bookmaker offers 5.0 odds for an event and you place a bet worth £10, your winnings will be £50. Comparing decimal and fractional odds, it is hassle-free to tell that 4.2 odds give you higher winnings than 4.0 by just a glance. Fractional odds, on the other hand, can be confusing. For instance, given 10/5 and 3/1, it is difficult to tell which one gives higher winnings, especially for beginners. We, therefore, recommend decimal odds to novice players. Here is an example of decimal odds from a top bookmaker.

Understanding Decimal Odds

American Odds (Moneyline Odds)

American odds are more common in American websites, especially those offering martial arts and boxing. These odds use £100 as their evens line with negative and positive outcomes. If the betting odds are above the money line, it shows how much profit you expect to win from a £100 bet. For example, if you bet on +150 odds, it means you stand a chance to make a profit of £150 if your bet wins. Moneyline odds that have negative odds indicate how much stake you need to place to win £100. For instance, if the odd is -150, it means you need to wager £150 in order to win £100. These odds are easy to interpret as long you understand what the positive and negative signs mean.

How to Convert Fractional Odds to Decimal and Vice Versa

When converting odds from decimal to fractional format, you need to subtract 1 from the decimal and convert it to the nearest whole number. For instance, if you have 4.5, in the fractional form it will be 3.5/1. You can multiply both sides by 2 to get 7/2. 

If you want to convert fractional odds to decimal, you need to divide the first number by the second and then add 1. For instance, if you have 7/2 odds, you will divide 7 by 2, which is 3.5, and then add 1 to give you 4.5. The same case applies to 3.5/1, which is 3.5+1 to give you 4.5. The table below illustrates several odds values in decimal and fractional formats.

Fractional

Decimal

 

100/1

101.00

1/100

1.01

1/10

1.10

½

1.50

2/5

1.40

1/1

2.0

2/1

3.00

4/1

5.00

9/1

10.00

What is Probability?

In betting, players have a chance to predict the outcome of a competition whereby they win if their prediction favors them. There are several outcomes for any given event. Take an example of a dice. If you roll it, there are six possible outcomes. The probability of getting one is 16.66%. Betting odds usually present the likelihood of an outcome in an event. 

This is what is called probability. Now that we have learned how betting odds work, let us find out how they relate to probability.

Calculating Probability Using Betting Odds

Given a fractional odd of 4/1 (A/B), it is easy to calculate the probability of the outcome.  

Probability (%) = B / (A+B)

  • 4/1 can be calculated as 1/ (4+1) =0.20 meaning the probability of the outcome is 20%
  • Same case if you take 2/2, the probability can be calculated as 2/ (2+2) = 0.50 which is 50%

For decimal odds, you divide 1 by the odd.

  • Given 2.0 odds, the probability will be 1 divide by 2.0, which is 0.5. The probability is therefore 50%
  • In the case of 1.5 odds, the probability will be 1 divide by 1.5, which is 0.66. It gives us a 66% probability.

Published: 06/22/2021

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