How to Read Betting Oddsby Steven Hubbard
Betting Odds Explained
For anyone who is new to sports betting, understanding how betting odds work can be a headache.
After all, without a clear knowledge of how betting odds work, people can feel quite lost.
Our guide to understanding betting odds has all the information you need, so read on.
Different Types of Betting Odds
The first thing to note is that odds are usually shown in one of three main formats:
- Fractional: 3/1
- Decimal: 4.00
- American/moneyline: +300
All of the above numbers show the same betting odds. Most betting sites in the UK now allow their online customers to display their betting odds in whichever format they prefer to use.
Some people find it easier to work with fractional odds, which are the traditional method. However, some sports fans who are new to sports betting find decimal odds to be better.
When betting on US sports such as basketball or matches in the NFL, the moneyline or American odds may be more appropriate to use. It is basically a matter of personal preference.
Fractional Betting Odds Explained
Fractional betting odds are most common in the UK, but most UK bookies now offer several different formats. But if there are only fractional betting odds, it’s easy to understand.
The easiest way to learn is by looking at the odds like this: How much you will win/how much you stake (2/1)
So for every £1, you stake, you will win £2. Simple as that. (2/1)
8/1 = Every £1 you stake, you will win £8
1/10 = Every £10 you stake, you will win £1
1/3 = Every £3 you stake, you will win £1
1/1 = Every £1 you stake, you will £1
This is not including your stake though, just the profit from the bet. For the total amount add your stake.
Decimal Betting Odds Explained
Decimals betting odds are becoming a lot more popular, and almost all bookies now have them as an option. They are an alternative to fractions and can be easier to work out the overall return (including your stake) and easier to convert into a percentage.
Our free football betting tips are listed in decimal format as it is the easiest method of calculating returns. They represent the potential returns of the bet including the stake.
Simply multiply the amount you wish to bet by the decimal odds offered.
Calculation: (odds x stake = returns – stake = profit)
3.50 x £10 = £35 – £10 = £25 profit
2.00 x £10 = £20 – £10 = £10 profit
1.10 x £10 = £11 – £10 = £1 profit
American Betting Odds Explained
American odds, also known as Moneyline odds are shown in a positive or negative number. A positive number shows how much you might profit if you bet £100.
A negative number shows what you must bet to make £100 profit. The positive number shows the underdog and the negative shows the favourite.
This format will not be used by many UK punters but it is an option in many sportsbooks so it’s good to know.
Now it’s important to know that you do not need to bet £100, the odds work on whatever stake you place.
American Odds: Russia (-275) vs Saudi Arabia (+900) stake £100
To work out the favourite you can do 100 / 275 x 100 = £36.36 profit with your £100 stake
To work out the underdog you can do 900 x 100 / 100 = £900 profit with your £100 stake
What is Probability?
To gain a thorough understanding of how betting odds, it is important to consider probability.
Betting odds are designed to show the probability of a certain event happening in sports. The higher the betting odds, the less likely an event is deemed to happen. If the odds are low – which is sometimes also referred to as a short price – then the event is more likely to happen.
Let’s use the example of Manchester United taking on Tottenham in a Premier League game. According to the bookmakers, Spurs are the outsiders for the match, which is at Old Trafford.
Their odds are 3/1, which means bookies believe they will win the game one out of four times. There is more to it than that, of course, as betting sites also factor in what is called a betting margin.
Usually, between three and seven per cent, a betting margin is how betting sites ensure they can turn a profit. This is why even when there are only two potential outcomes in any one particular betting market, the odds will not add up to a total probability of exactly 100 per cent.
Using Betting Odds To Calculate Probability
Now we understand how probability works, we can use betting odds to work out the probability.
The key thing to remember here is that betting odds will only ever show implied probability.
This is due to various factors, including the betting margin we mentioned earlier in this guide.
Betting odds are also fluid and can be changed by betting sites if one option is proving popular.
For example in horse racing betting, a runner might become the favourite because there is a sudden influx of bets being placed on that horse coming out on top in the race.
To offer a clear way of how to use betting odds to calculate probability, let’s look at tennis.
Tennis is a useful sport for our example here as the match-winner market only has two options, unlike a lot of team sports where the possibility of a draw also has to be taken into account.
In our hypothetical example, let’s say that Roger Federer is playing Rafael Nadal at Wimbledon.
Federer is the favourite in the eyes of the bookies, who have his and Nadal’s odds as follows:
- Fractional odds: 1/5
- Decimal odds: 1.2
- American odds: -500
- Implied probability: 83.3%
- Fractional odds: 4/1
- Decimal odds: 5.0
- American odds: +400
- Implied probability: 20%
Converting Decimal Odds To Implied Probability
To calculate the implied probability from decimal odds the equation to work it out is:
(1/ decimal odds) * 100 = implied probability
So to find out the probability of a Federer win the calculations would be as follows:
(1 / 1.2) * 100 = 83.3 per cent
According to the decimal odds of 1.2, Federer had an 83.3% chance of winning.
But how can we use betting odds to calculate winnings? Let’s take a look.
Using Betting Odds To Calculate Winnings
Luckily, using betting odds to calculate winnings is easier than it is for probability.
It works in a slightly different method for each way that betting odds can be displayed, however.
For betting odds displayed as a fraction, the equation could hardly be more straightforward.
If the price shown is 3/1, it means £1 stake will result in £3 winnings, plus the initial stake. The number on the right side of the fraction is the stake needed to win the number on the left side.
For betting odds displayed as a decimal, calculating the winnings is a little bit different. It is still pretty simple, though, which is why so many people now prefer to use odds as decimals.
If the decimal odds are 11.0, this means a £1 stake results in returns of £11, including the stake.
This is a minor point of difference with calculating winnings from betting odds as fractions.
When using American odds to calculate winnings, the process is again a little bit different.
If the American or moneyline odds are shown as +130, this means the bettor gets £130 for every £100 that they opt to stake. As long as the bet turns out to be a winning wager, of course.
American odds can also be shown as a positive or negative figure, which adds complication.
If the number is negative, for example, -145 rather than +130, this means they are favourites and expected to win, with a smaller payout as a result.
At American odds of -145, bettors get back £100 for every £145 staked, with the calculation simply reversed from the process of calculating positive American odds into winnings.
All in all, calculating odds might seem difficult, but it is easy to get your head around.