The first thing to understand in sports betting is the odds, which usually indicate the multiplier factor (potential payout) and the winning chances.
The stack of these odds scrambled in a sportsbook can be quite confusing, but it’s really simple to understand. This write-up is a guide to understanding the implications of betting odds.
What Are Betting Odds?
Betting odds represent the ratio of the amount risked by the bookmaker to the bettor’s wager. For instance, odds of 3.00 indicate that the sportsbook stakes 3 times as much as the amount by the bettor.
Now the question is that what informs the prescribed odds? This can be narrowed down to probability. When it comes to predicting the result of a certain event, the probability is a predominant factor.
For example, there are six possible outcomes in rolling a die, and each of them comes with a chance of 16.67% of happening. However, with betting in sports events, the probability depends on several other factors.
Using Betting Odds to Calculate Probability
In some cases, the odds are represented by a fraction, e.g. 4/10. With fractional odds, bettors can determine how likely a given event is.
Let’s take the fractional odd as 9/1. The probability of this happening can also be represented by 1/(9 + 1) = 0.10. In other words, there is a 10% chance that this outcome will happen.
This probability in percentage only represents a theoretical assertion to the chances. Most online bookmakers offer the odds in decimal or fractional format. In the decimal format, the odd can easily be converted into probability.
For instance, the probability of winning a game of 9 odds is 1/9 * 100 = 11.11%
Using Betting Odds to Calculate Winnings
Betting odds also depict how much bettors stand to win from a bet. Let’s take a fractional odd of 9/1, for example. Here the winning becomes €9 for every €1 you stake. 1/4 means you will win €1 for every €4 you bet.
As far as decimal odds are concerned, the formula to calculate your wins is = odds * stake – stake.
So if the odd is 1.25 and the stake is €10, the profit is 1.25 x €10 – €10 = €2.50
Decimal Odds vs Fractional Odds
The Decimal and Fractional format both have their pros and cons. But generally, there is a shift towards the decimal odds. For one, the decimal counterparts are easier to understand.
Also, the decimal odds provide more information. The decimal odds represent the win and the returned stake. Also, the decimal format makes it easier for odd fluidity in cases where the bookmaker has to change the odds of a game.
With decimal odds, it is easy to effect changes as opposed to in the fractional format, which would lead to the creation of large fractions. They are usually too cumbersome for easy understanding and computing.
Fractional odds are still common at UK online sportsbooks, but now there is a greater preference for decimal odds.
Another format of displaying odds is the Moneyline price, but it is mainly popular in America.
Betting odds show the probability of winning a bet and help bettors to figure out the potential win or payout. Hence, these odds have to be as simple as possible so that punters can read and understand it at a glance. Fortunately, most betting platforms will allow different betting odds formats.