Betting is incredibly entertaining, but also somewhat difficult to understand. This holds true especially if you are a beginner. With all the different types of betting odds and markets, odds and probabilities and strategies, it is natural to feel a little overwhelmed at first glance.
But with a little practice and some help from us, you will be an expert in no time. Let’s start with the most basic, but sometimes confusing part of betting – odds. In this article, we break down what they are, what they mean, the different types of betting odds and how to read them.
What Are Betting Odds?
In order to be a successful punter, you would need to understand how odds work. Without being able to read betting odds, you’ll have no way of knowing which team has the highest probability of winning, or how much your payout will be based on the amount of money you stake.
In betting, odds represent the probability of an event occurring. They let you know how much money you would get if your wager wins. So you could see why understanding them would be important. They’re expressed in numbers and are of a few types – decimal, fractional and American odds.
While all of these reflect probabilities, they are slightly different from each other. We’ll take a look at each of them.
1. Decimal odds or European Odds
Like the name would indicate, these odds are expressed in the form of decimal numbers (1.50, 3.62…). They are also known as European odds and are used by most bookmakers around the world.
One thing you should know about this type of odds is that the smaller the number, the higher the possibility of that even occurring.
If an outcome’s odds are 1.20 for example, it has a higher chance of occurring when compared to an outcome that has been assigned odds of 2.50. Calculating your potential winnings is easy, just follow this simple formula.
Your stake x Decimal odds = Total winnings.
So if you bet $100 on an event that has odds of 1.50, you total play out would be $150. To calculate your profits, you need to subtract your stake from your total winnings, which in this case would be $50.
Like we mentioned before, you can also calculate probability, which is expressed in a percentage, with the odds. To do so, you need to divide 100 by the odds. Using the above example, the probability would be 66%. (100/1.50)
2. Fractional odds
Fractional odds are represented by a fraction, or by two numbers separated by a slash – 7/1, 3/2, 1/3 and so on. Similar to decimal odds, you can calculate your winnings as well as the probability.
The numerator or the number on the left side of the slash represents the number of times by which your stake will be multiplied by if you bet the same amount of money as the denominator or the number on the right side of the slash. Here’s how you calculate profits for 3/2 odds if you bet $10.
(Stake x fraction odds) + stake = total payout.
($10 x 3/2) + 10 = $15.
This means that your profit would be $15.
Here’s how you would calculate probability. You divide the sum total of the numerator and denominator and numerator by the denominator. Multiply the total into 100.
3/2 would be 2 ÷ (3+2) x 100, which would be 40%
3. American odds
American odds, also known as Moneyline odds are predominantly used in the United States. The odds are usually a whole number accompanied by a + or – sign (+200, – 360….).
The teams or outcomes with the negative value are the favorites and indicated the amount of money you would need to stake in order to win a $100. While the teams or outcomes with a positive value are the underdogs, which is representative of the amount won for every $100 staked. Here’s an example to illustrate.
Team A: +250
Team B: -170
For team A, the underdogs, you would need to stake $100 in order to make a profit of $250.
Foe team B, the favourites, you would need to bet $170 in order to win $100
Here’s how you can calculate probability for the favourites to win. (Feel free to use a calculator)
( – (-odds) ) ÷ ( ( – (-odds) ) + 100)
( – (-170) ) ÷ ( (- (-170) ) + 100 ) = 0.62 or 62%
Here’s the formula for the underdog odds
100 ÷ (+odds +100)
100 ÷ (+250 +100) = 0.28 or 28%.
There you have it, all you need to know about reading odds.