Betting odds are the foundation of sports betting, casino games, and various gambling activities. They tell you how much you can win and how likely an event is to happen. Understanding betting odds is crucial for anyone looking to participate in betting. Thus, in this guide, we’ll break down the different types of odds. Also we will explain how to decipher them effectively.
Let’s get in.
Learning betting odds is definitely important. But, before diving into how to understand betting odds, it’s essential to know that there are three main types of odds formats. Such as moneyline odds, decimal odds, and fractional odds. Thus, let’s explore each of them:
Fractional betting odds are quite a common form of betting odds that are used in the UK. As the name suggests those are represented as fractions, such as 5/1, 2/7, or 7/2. The numerator of the fraction represents the potential profit, and the denominator tells that how much money is on the stake. For example:
a. If you bet 500 on 4/1 odds, you can win 2000 (500 x 4) in profit. Also, the initial stake of 500 excludes that.
b. In another example, if you bet 500 on 1/7 odds, you can win 71.42 (500 ÷ 7) in profit. And of course an additional amount of 500, which you put in the initial stake.
Decimal odds is another betting type that is famous in Europe. It is represented as decimal numbers, such as 4.00, 1.70, or 6.75. Also, when you are trying to calculate the decimal odds, you must know your total payout, which includes both profit as well as the original stake. Thus, multiplying your stake by the decimal odds gets the right answer. For example:
a. If you bet 500 on 4.00 odds, your total payout will be 2000 (500 x 4.00). Also, it includes your initial 5100 stake.
b. If you bet 100 on 1.50 odds, your total payout will be 150 (100 x 1.50). And of course that includes your initial 100 stake.
Here is the third type of betting odds. Moneyline betting odds are commonly used in the United States. Those are basically represented as positive (+) or negative (-) numbers. Thus, positive numbers indicate potential profit on a 100 stake. On the other hand, negative numbers indicate how much you need to bet to win 100. Such as:
a. If you see odds of +300, a 100 bet can win you 300 in profit. ANd there will be an additional 100 that you bet at the beginning.
B. Here is an example for negative odds. If you see odds of -150, you need to bet 150 to win 100 in profit, plus your initial 150 stake.
Understanding the difference in Probability and Implied Probability
Betting odds not only tell you how much you can win but also provide insights into the probability of an event occurring. The implied probability is a way to calculate how likely an event is based on the odds.
For precise calculation of implied probability from fractional odds, you can use the formula:
Implied Probability (%) = (Denominator / (Numerator + Denominator)) x 100
For example, with 5/1 odds:
Implied Probability (%) = (1 / (5 + 1)) x 100 = (1/6) x 100 ≈ 16.67%
To calculate implied probability from decimal odds, use the formula:
Implied Probability (in %) = (1 / Decimal Odds) x 100
For example, with 2.00 odds:
Implied Probability (%) = (1 / 2.00) x 100 = 50%
Positive moneyline betting odds indicate an underdog, and the higher the positive number, the less likely the event is to occur. For example, +500 means the event is less likely to happen than +300.
Negative moneyline betting odds indicate a favourite, and the smaller the negative number, the more likely the event is to occur. Let’s use an example to make it crystal clear. If you see a -150 under money line odds. Then it means the event is more likely to happen than -200.
Understanding betting odds is quite important if you are in the betting world. Using that you can make informed betting decisions. Bow, you can use any of the three available types of betting odds. That’s your choice. But remember, each has one sole motive. And that is to bring enough valuable information to the table, so that the players can make profit. As it will help you make a guess about the happening of certain events. Thus, after mastering the different types of odds formats and calculating implied probabilities, you can become a more knowledgeable as well as successful bettor in the world of sports betting and gambling.