1. Decimal Odds
Decimal odds are the most common format globally (outside of the US) and are arguably the easiest to understand and work with mathematically. They represent the total payout (including your original stake) for every $1 wagered.
Example:
Odds: 2.50
A $10 bet at 2.50 odds would pay out $10 * 2.50 = $25 total. Your profit is $25 - $10 stake = $15.
Calculation: Total Payout = Stake * Decimal Odds
Converting Decimal odds to implied probability is also straightforward: Implied Probability = (1 / Decimal Odds) * 100%.
Example (cont.):
Odds: 2.50
Implied Probability = (1 / 2.50) * 100% = 0.4 * 100% = 40%
2. Fractional Odds
Fractional odds are traditional in the UK and Ireland. They represent the profit you will receive relative to your stake.
Example:
Odds: 5/2 (read as "five-to-two")
This means for every $2 you wager, you will win $5 profit. Your original stake is returned on a winning bet.
A $10 bet at 5/2 odds would win ($10 / 2) * 5 = $25 profit. Total payout = $25 profit + $10 stake = $35.
Calculation: Profit = Stake * (Numerator / Denominator)
Total Payout = Stake + Profit
Converting Fractional odds to implied probability: Implied Probability = (Denominator / (Numerator + Denominator)) * 100%.
Example (cont.):
Odds: 5/2
Implied Probability = (2 / (5 + 2)) * 100% = (2 / 7) * 100% = ~0.2857 * 100% = ~28.57%
3. American (Moneyline) Odds
American odds are commonly used in the United States, particularly for Moneyline bets. They are displayed as either a positive (+) or negative (-) number.
Example:
- Positive Odds (Underdog): +150
This means a $100 bet will win $150 profit. Your total payout is $100 stake + $150 profit = $250.
Calculation: Profit = Stake * (Odds / 100)
- Negative Odds (Favorite): -200
This means you need to wager $200 to win $100 profit. Your total payout is $200 stake + $100 profit = $300.
Calculation: Profit = Stake / (Odds / 100)
Converting American odds to implied probability:
Example (cont.):
- Positive Odds (+150): Implied Probability = (100 / (Odds + 100)) * 100% = (100 / (150 + 100)) * 100% = (100 / 250) * 100% = 40%
- Negative Odds (-200): Implied Probability = (Odds / (Odds + 100)) * 100% = (200 / (200 + 100)) * 100% = (200 / 300) * 100% = ~66.67%
4. Why Implied Probability is Your Best Friend
While knowing the payout is important, the most valuable information in betting odds is the implied probability. It represents the bookmaker's assessment of the likelihood of an event. By comparing the implied probability to your own estimated probability (based on research or data), you can identify bets that offer value – where the odds are more favorable than the true likelihood suggests.
Understanding implied probability is also key to recognizing the bookmaker's built-in edge, or vig.
Conclusion: Master the Odds, Master Your Strategy
Don't let different odds formats intimidate you. Once you understand how to read them and, more importantly, how to convert them into implied probability, you gain a powerful tool for evaluating bets objectively. This skill is fundamental to identifying value and developing a truly data-driven betting strategy. Bet Better provides tools and insights that incorporate odds analysis to help you find the most profitable opportunities.
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