Betting Information
How Do Betting Odds Work?
What are Betting Odds?
Betting odds are the ‘beating heart’ of sports betting, or any betting for that matter. If you’re going to have a bet, then you need to understand them. Sportsbooks or bookmakers, where most people bet, offer up odds on betting markets to help the bettor work out their liabilities and profit on any given event.
Odds are a numerical representation of the probability of a specific outcome in a sporting or other betting market. They tell us the likelihood of a particular outcome occurring in a betting market.
The History of Betting Odds
The concept of betting odds dates back centuries, with evidence of its existence in ancient civilizations. The Greeks, for instance, engaged in sports betting and developed a basic system of odds. Over time, the concept evolved and became more structured.
Useful Points
- Betting odds are primarily based on probability calculations and statistical analysis.
- The odds are influenced by various factors, including historical data, team performance, player injuries, and public perception.
- Bookmakers adjust odds in real-time to account for betting patterns to maintain a balanced book.
- Different regions have adopted distinct odds formats, each with its unique way of representing probabilities and payouts.
Betting Odds Formats
There are three main types of betting odds formats used worldwide: fractional odds, decimal odds, and moneyline odds. There are also some other formats that you should know about. Each format presents odds in a different way, but they all convey the same underlying information.
Fractional Betting Odds
Fractional odds or ‘traditional’ odds are mainly used in the UK, I like them the best, even if they might not be the simplest to understand. They are expressed as fractions and represent the ratio of the potential profit to the stake.
Examples:
A football team has odds of 5/1. If you place £10 on the team and they win, you will get paid out your profit of £50 and get your stake of £10. A total payout / return of £60. If the team lost you would simply lose your stake of £10.
A hockey team has odds of 6/4. If you place £4 on the team and they win, you will get paid out your profit of £6 and get your stake back of £4. A total payout / return of £10. If the team lost, you would simply lose your stake of £4.
Of course you don’t have to bet £4, it’s just an easy way to explain the bet / profit. Odds of 6/4 are effectively saying you will win 1.5 times your stake (6 divided by 4 = 1.5). If your stake was £10 for instance and your bet won, your profit would be £15. With your stake back, your overall payout / return would be £25.
In the above examples, the odds are ‘odds against’. All this means, is that the outcome is less likely to occur, than occur.
In the next example the odds are ‘odds on’ (the opposite of odds against) this means that the outcome is more likely to occur, than not occur.
A tennis player has odds of 1/2. If you place £2 on the player and they win, you will get paid out your profit of £1 and your stake back of £2. A total payout / return of £3. These odds should look familiar, they basically express a 1/2 (or a ‘half’). You will win half your stake in terms of profit. So if you’d placed £15 on the player, your profit would be £7.50. With your stake back, your overall payout / return would be £22.50
Interpreting Fractional Odds
To interpret fractional odds, it is important to understand the relationship between the numerator (top number) and the denominator (bottom number).
In the case of the football team’s odds of 5/1, the numerator is quite a lot bigger than the denominator. This suggests that the bookmaker considers the football team less likely to win the match. Therefore, the potential profit is higher because the risk is greater.
On the other hand, the hockey team’s odds of 6/4, have a smaller difference between the numerator and the denominator. This implies that the bookmaker considers the hockey team likely to win. As a result, the potential profit is lower because the risk is lower.
In our examples above, if a football team’s odds are 5/1, it means that in total there are 6 possible outcomes to this event. If the match were to be played 6 times (under the same / similar conditions) your selected team should win on one occasion, and lose on the other five occasions. The hockey team, over 10 outcomes, would lose 6 times and win 4.
There are some quirks surrounding fractional odds. Why, for instance, is 100/30 not simply expressed as 10/3? Why is 6/4 (as with our hockey example) not expressed 3/2. I don’t think anyone really knows, but it could be an ‘age thing’. Fractional odds came in to existence many hundreds of years ago.
Decimal Betting Odds
Decimal odds, widely used in Europe, Canada, Australia and New Zealand, express the potential payout as a decimal value. For instance, consider the decimal odds for a tennis match:
- Player A: 2.50
- Player B: 1.60
Example:
A £10 bet on Player A would yield a £15 profit. With the original stake back of £10, the total payout / return would be £25
A £10 bet on Player B would Yield an £6 profit. With the original stake back of £10, the total payout / return would be £16
The decimal format shows your total payout / return from the outset.
So, for player A: Odds = 2.5. Total potential payout / returns, £10 x 2.5 = £25.
This is different to fractional odds which are geared towards showing you your potential profit.
Converting Fractional Odd to Decimal Odds
We can easily convert fractional to decimal odds by using the following formula:
Numerator / denominator + 1 = Decimal odds
To convert odds of 2/1 to decimal odds: 2 ÷ 1 + 1 = 3.0
To convert odds of 7/2 to decimal odds: 7 ÷ 2 + 1 = 4.5
..and Back Again..
If you prefer Fractional odds, you can convert Decimal odds by reversing the formula above:
The long way, but it’s clearer, using our 7/2 example:
To remove the decimal point, we multiply 3.5 by 10 and divide 3.5 by 10.
= (3.5 x 10)÷10 = 35÷10.
This can further be reduced to 7/2, as both numerator and denominator are divisible by 5.
You can play around with this simple fractional / decimal odds calculator.
Saying Betting Odds ‘Out Loud’
The UK traditionally uses fractional odds, but today, with the rise of the betting exchanges, the two main odds formats used are fractional and decimal. If you are a UK punter, these are the only two odds formats that you’ll need to know.
It’s always good to know how to ‘say odds out loud’. Below are just a few sample odds I’ve picked (there is a very comprehensive odds conversion table later in this article). So if you are ever in a high street bookmaker you can say, “I’ll take those odds of nine to four guv.” 😉
| Odds | Out Loud | Stake | Profit | Total Return |
|---|---|---|---|---|
| 1/2 | “one to two” | £1 | £0.50 (50p) | £1.50 |
| 1/1 | “evens” or “even money” | £1 | £1.00 | £2.00 |
| 2/1 | “two to one” | £1 | £2.00 | £3.00 |
| 9/4 | “nine to four” | £1 | £2.25 | £3.25 |
| 7/2 | “seven to two” | £1 | £3.50 | £4.50 |
| 9/2 | “nine to two” | £1 | £4.50 | £5.50 |
| 10/1 | “ten to one” | £1 | £10.00 | £11.0 |
You probably get the idea and can work out how to say the rest. How would you say 3/1 (4.0 decimal)? That’s easy enough: “three to one” and to a £1.00 stake that would be a £3.00 profit.
What about something more obscure like 3/5? That’s easy enough too:
Out loud, you would say this as “three to five”.
3/5 (3 divided by 5 = 0.6). To a £1.00 stake your profit would be £0.60 or 60p (£1.00 x 0.6).
US Betting Odds
The United States predominantly uses the moneyline or American odds format. This format represents the amount that needs to be wagered to win $100, or the amount won for a $100 bet. Of course it is just ‘representative’, you can bet as much as you like / as will be accepted by the sportsbook. For instance, consider the following US odds for a basketball game:
- Team A: -150
- Team B: +120
A negative number (-150) for Team A indicates that a $150 bet is required to win $100. On the other hand, a positive number (+120) for Team B signifies a $100 bet would result in a $120 profit. In both cases your original $100 stake would be returned.
To convert US odds to fractional odds:
Formula for positive US odds = US Odds÷100
For example, +300
+300/100 = 3/1
Formula for negative US odds = 100÷US Odds
For example, -200
100/-200 = 1/2
To convert US odds to decimal odds
Formula for positive US odds = (US Odds÷100) +1
For example, +300
(+300÷100) + 1 = 4.00
Formula for negative US odds = (100÷US Odds) +1
For example, -200
(100 ÷ -200) + 1 = 0.5 + 1 = 1.50
Hong Kong Betting Odds
Hong Kong employs a unique odds format known as Hong Kong odds. This format is similar to decimal odds, but it is geared towards showing you your profit not your total return as with decimal odds.
For example:
- Team A: 0.50
- Team B: 1.80
In this format, a £10 bet on Team A, would yield a £5 profit, plus the original £10 stake returned, totalling £15.
A £10 bet on Team B, would result in a £18 profit, plus the original £10 stake returned, totalling £28.
A £10 bet at 1.0 would be ‘even money’ or a 50/50 chance. Your profit would be £10 (return with stake, £20).
Malay / Malaysian Betting Odds
Malaysia uses Malay odds, which are expressed in positive or negative digits. These odds represent the potential winnings per 1 unit bet. Pay attention because Malay odds can be counter-intuitive to some people as they feel kind of ‘inverted’, except probably to the people of Malaysia 🙂
Positive and Negative
Any negative numbers have a probability of less than 50% and show which team is the underdog, while positive numbers have a probability of more than 50% and show which team is favourite.
Malay odds can never exceed 1.00. Also note that Malay odds of 0.00 represent even money or a 50/50 chance.
Example:
- Team A: -0.8
- Team B: +0.7
If your stake is £10 at odds of -0.8 (underdog) your potential profit would be £12.50. We get this by dividing 1 by 0.8 = 1.25. Then we multiply the 1.25 by our £10 stake = £12.50 profit. We also get our stake back.
If your stake is £10 at odds of +0.7 (favourite) your potential profit would be £7. We get this by multiplying 1 by 0.7 = 0.7. Then we multiply the 0.7 by our £10 stake = £7 profit. We also get our stake back.
Indonesian or ‘Indo’ Betting Odds Format
Indonesian odds are relatively easy to understand. They are probably most similar to US odds / Moneyline, except that they are based on 1 unit bet, not 100.
- Team A: -2.00
- Team B: +1.5
Team A’s odds of -2.00, means that you’ll need to risk 2.00 units to win 1.00 unit. A £10 bet will win you £5, a total return of £15 with your stake back.
Team B’s odds of +1.5, means that you’ll need to risk 1.00 unit to win 1.50 units. A £10 bet will win you £15, a total return of £25 with your stake back.
Summary Betting Odds Tables
Odds Table Showing ‘Odds Against’ Example.
| Odds Format | Odds |
|---|---|
| Fractional | 2/1 |
| Decimal | 3.00 |
| US / Moneyline | +200 |
| Hong Kong | 2.00 |
| Malaysian | -0.50 |
| Indonesian | 2.00 |
Odds Table Showing ‘Odds On’ Example.
| Odds Format | Fractional Odds |
|---|---|
| Fractional | 1/4 |
| Decimal | 1.25 |
| US Moneyline | -400 |
| Hong Kong | 0.25 |
| Malaysian | 0.25 |
| Indonesian | -4.00 |
Betting Odds and Implied Probability
Betting odds represent the likelihood of a specific outcome happening in a betting market. Implied probability, on the other hand, is a conversion of those odds into a percentage value, which reflects the perceived probability of the event occurring. Understanding implied probability allows bettors to assess the value of a bet and make informed decisions.
The implied odds at a bookmaker might be 4/1 for a team to win, an implied probability of 20%. You might feel, however, that the team has a 25% chance of winning, or odds of 3/1. You snap up the 4/1 price because, if your judgement is right, you will be getting great value.
Implied Probability from Fractional Odds
To calculate the implied probability from fractional odds, use the following formula:
Implied Probability = (Denominator / (Denominator + Numerator)) * 100
For odds on a football team to win at 4/1:
(1 / (1 + 4)) * 100 = 20%
The team has a 20% chance of winning, based on the odds.
Implied Probability from Decimal Odds
Implied Probability = (1 / Decimal Odds) * 100
For odds on a hockey team to win at 3.00:
(1 / 3.00) * 100 = 33.33%
The team has a 33.33% chance of winning, based on the odds.
Betting Odds and Bookmakers
Bookmakers present their odds to the betting public. From the odds, the bookmakers will know how much they potentially need to pay out on an event and the betting public will know how much they stand to win on event.
However, the odds are also the means by which the bookmaker makes his profit, in terms of ‘overround’. This is effectively the margin percentage that the bookmaker builds in to the market so as to make his profit.
Check out the table below of a horse race showing the odds and implied probability. The figures are taken from an actual race.
| Horse | Odds | Implied Probability % |
|---|---|---|
| Horse 1 | 11/10 | 47.6 |
| Horse 2 | 10/3 | 23.1 |
| Horse 3 | 4/1 | 20.0 |
| Horse 4 | 7/1 | 12.5 |
| Horse 5 | 25/1 | 3.80 |
| Total | = | 107% |
In this case, the bookmaker’s margin or overround, is 7%. So, out of all the money that the bookmaker collects on this race, he will make a profit of 7%, regardless of which horse wins.
Is it that simple?
No, actually it’s not. You will see that in the lead up to sports events, the prices in the market almost always change. Some odds get shorter, some odds get longer, as the bookmakers continually try to balance the money / bets coming in from customers.
Sometimes, they are caught out and left in a situation where they are effectively betting too, but at least in this rare scenario, they probably have some value.
Odds are not Only for Betting
Odds can be produced for anything, e.g. odds of being hit by a car crossing the street or being struck by lightening. You can even get odds (actually seen at a bookmaker) for being abducted by aliens.
Check out this infographic for some more quirky odds / probabilities, other than sports.
One event that is left off the above image, is the odds of being born! This is estimated to be in the region of… well… a very big number: 400,000,000,000,000,000/1 (400 quadrillion to one) which is basically zero. This takes in to account; our place in the universe, your mum meeting your dad, the chances of conception and so on.
Just so clarify, a billion is followed by a trillion, which is followed by a quadrillion.
Conclusion
Betting odds reflect the probability of an outcome occurring and provide information about the potential payout for a successful bet. The odds are determined by bookmakers based on various factors, including historical data, team performance, and public perception.
Bettors who understand the various odds formats, can then choose the most favorable style for their betting.
With a good understanding of how betting odds and their implied probabilities work, bettors can make informed decisions and enhance their chances of success in the betting world.
Below you will find a useful table for converting the most popular odds formats. Good luck!
Betting Odds Conversion Table
The table below shows a comprehensive list of odds formats and implied probability.
| Fractional (UK) | Decimal (European) | Moneyline (USA) | Implied Probability |
|---|---|---|---|
| 1/5 | 1.20 | -500 | 83.3% |
| 2/9 | 1.22 | -450 | 81.8% |
| 1/4 | 1.25 | -400 | 80% |
| 2/7 | 1.29 | -350 | 77.8% |
| 3/10 | 1.30 | -333.3 | 76.9% |
| 1/3 | 1.33 | -300 | 75% |
| 4/11 | 1.36 | -275 | 73.3% |
| 2/5 | 1.40 | -250 | 71.40% |
| 4/9 | 1.44 | -225 | 69.2% |
| 1/2 | 1.5 | -200 | 66.7% |
| 8/15 | 1.53 | -188 | 65.2% |
| 4/7 | 1.57 | -175 | 63.6% |
| 8/13 | 1.62 | -162 | 61.9% |
| 4/6 | 1.67 | -150 | 60% |
| 8/11 | 1.73 | -137 | 57.9% |
| 4/5 | 1.80 | -125 | 55.6% |
| 5/6 | 1.83 | -120 | 54.5% |
| 10/11 | 1.45 | -220 | 68.8% |
| Evens | 2.00 | +100 | 50% |
| 11/10 | 2.10 | +110 | 47.6% |
| 6/5 | 2.20 | +120 | 45.5% |
| 5/4 | 2.25 | +125 | 44.4% |
| 11/8 | 2.38 | +138 | 42.1% |
| 7/5 | 2.40 | +140 | 41.7% |
| 6/4 | 2.50 | +150 | 40% |
| 8/5 | 2.60 | +160 | 38.5% |
| 13/8 | 2.63 | +163 | 38.1% |
| 7/4 | 2.75 | +175 | 36.4% |
| 9/5 | 2.80 | +180 | 35.7% |
| 15/8 | 2.88 | +188 | 34.8% |
| 2/1 | 3.00 | +200 | 33.3% |
| 11/5 | 3.20 | +220 | 31.3% |
| 9/4 | 3.25 | +225 | 30.8% |
| 12/5 | 3.40 | +240 | 29.4% |
| 5/2 | 3.50 | +250 | 28.6% |
| 13/5 | 3.50 | +250 | 28.6% |
| 11/4 | 3.75 | +275 | 26.7% |
| 3/1 | 4.00 | +300 | 25% |
| 10/3 | 4.33 | +333 | 23.1% |
| 7/2 | 4.50 | +350 | 22.2% |
| 4/1 | 5.00 | +400 | 20% |
| 9/2 | 5.50 | +450 | 18.2% |
| 5/1 | 6.00 | +500 | 16.7% |
| 11/2 | 6.50 | +550 | 15.4% |
| 6/1 | 7.00 | +600 | 14.3% |
| 13/2 | 7.50 | +650 | 13.3% |
| 7/1 | 8.00 | +700 | 12.5% |
| 15/2 | 8.50 | +750 | 11.8% |
| 8/1 | 9.00 | +800 | 11.1% |
| 17/2 | 9.50 | +850 | 10.5% |
| 9/1 | 10.00 | +900 | 10% |
| 10/1 | 11.00 | +1000 | 9.1% |
| 11/1 | 12.00 | +1100 | 8.3% |
| 12/1 | 13.00 | +1200 | 7.7% |
| 13/1 | 14.00 | +1300 | 7.1% |
| 14/1 | 15.00 | +1400 | 6.7% |
| 15/1 | 16.00 | +1500 | 6.3% |
| 16/1 | 17.00 | +1600 | 5.9% |
| 18/1 | 19.00 | +1800 | 5.3% |
| 20/1 | 21.00 | +2000 | 4.8% |
| 25/1 | 26.00 | +2500 | 3.8% |
| 33/1 | 34.00 | +3300 | 2.9% |
| 100/1 | 101.00 | +10000 | 1% |
| 1000/1 | 1001.00 | +100000 | 0.1% |
