If you’re new to betting, then a quick betting odds explanation will probably come in handy. There’s a whole range of different numbers that can look intimidating when you first log on to a betting website. But, using some simple maths, they’re pretty easy to understand.
Read this article for a betting odds explanation that will have you understanding odds with more confidence in no time.
A betting odds explanation:
What are betting odds?
Betting odds are a way of telling you the probability of a specified event. In other words, how likely the event is to happen.
A betting market provides you with numerous different outcomes to bet on. Take the ‘Match Odds’ market in football as an example, where the three options are:
1. Home Team Win
2. Away Team Win
Each of these has a different chance of occurring, and the odds reflect the chance of each one happening.
How do betting odds work?
As I mentioned briefly at the start of this betting odds explanation, odds represent the probability of an event occurring. The best way to understand how probability works is to imagine you’re betting on the outcome of the roll of a dice.
There are 6 different outcomes when you roll the dice: 1, 2, 3, 4, 5 or 6. And they all have an equal chance of happening. If your number of choice in the market was 3, then there’s a 16.66% probability of that event happening.
What betting odds do is display that probability in a fractional or decimal format to show you how likely that event is to happen.
So in a fractional format, the true odds of you rolling a 3 will be 6.0 or 5/1. To calculate the implied probability of an event occurring you need to divide 100% by the decimal odds of a selection.
E.G. 100 divided by 6 = 16.66%
How to read odds
The next confusing thing people face when looking for a betting odds explanation is that there are different types of odds.
Fractional odds are attributed to traditional betting on race courses and in brick and mortar betting shops. However, with the introduction of the internet, there’s been a bit of a shift towards betting in decimals. This has led to less need for a betting odds explanation, as decimal odds are easier to understand.
However, to save you hopping onto Google for a quick “what are odds?” search, I’ll give you a full explanation.
Bookies display fractional odds like 5/1 or 2/5 (odds on). The way of understanding this is pretty simple. You need to think of it as Winners/Stake.
For example, if the odds were 10/1 and you bet £1, then you would win £10. Your total return from this would be £11 (winnings+stake).
Here are some further examples to help:
● 5/1 – For every £1 you bet you win £5
● 1/2 – For every £2 you bet you win £1
● 7/2 – For every £2 you bet you win £7
You will have seen us mention ‘odds on’, and if you don’t know what that is, it just means the total stake will be greater than the winnings. Anything below evens is an odds-on shot and means the probability of that selection winning is greater than 50%.
Luckily for you, if you don’t understand fractional odds, the bookmakers provide a solution. You can change fractional to decimal odds in the account settings of your online bookmaker.
Decimal odds are a lot easier to understand. They’re also quicker to work with and can provide a more accurate level of probability.
For example, which price is bigger, 3/1 or 16/5? That might take you a few moments to work out.
But if I said, which price is bigger 4.0 or 4.20? It’s immediately obvious.
For a beginner, it’s also a lot easier to work out what your winnings will be for each selection in decimal odds.
The sum is Stake x Odds. For example, if the selection you wish to bet on is 3.0 and you have £10 to stake on it, the sum is:
10 x 3.0 = £30 return.
The main thing to remember is that with decimal odds, your stake is included in the returns. So you must deduct the stake to work out your profit.
Here are some more examples:
● 6.0 x £10 = £60 return (£50 profit)
● 3.5 x £10 = £35 return (£25 profit)
● 1.8 x £10 = £18 return (£8 profit)
As we want to give you a comprehensive betting odds explanation, we’ll touch on American odds. But we won’t go too in-depth on this aspect as for many it will be irrelevant. But it’s always handy to have an understanding if you do run into them.
American odds use a baseline value of $100 to represent how much you must put on to win a set amount. $100 is the evens line, with the + symbol used to show the odds are above the line (for outsiders) and the – symbol to show that the odds are below the line (for favourites).
As an example, if the odds of a selection are -$150, that means you must place $150 to win $100.
If the odds are +$150, if you place $100 then you will win $150.
Converting Fractional to Decimal Odds
If for any reason you have fractional odds and need to convert them to decimal odds, then it’s very easy to do. All you need to do is divide the first number in the fraction by the second number. Then add 1.
So for 7/4 it would be 7/4 = 1.75 + 1 = 2.75
Most of the time, though, this isn’t necessary. Like I said earlier, you can change the odds from fractional to decimal in ‘settings’. This helps you spot the best odds straight away.
Using odds to find value
Hopefully, this betting odds explanation will be a useful tool for you when battling the bookmakers. Now I’ve answered your ‘what are “odds”?’ question, it’ll be useful for you to know how you can apply this knowledge. Well, the best and only way to beat the bookmaker is to find an edge. The game is all about finding value.
Now that you can convert odds into the perceived value, it means that you can work out whether you think the bookmakers implied probability of an event occurring differs from your own.
For example, if you notice that Team A has scored a first half goal in 75% of their home games this season, but the bookmaker has the market priced at 2.0 (50% implied probability) then you have just found some value.
The problem with this method though is that you need to be better than the bookmaker at calculating probability. This is a difficult task considering the huge teams of mathematicians that they employ.
Probably the best way to increase value is by using the bookmaker’s free bet offers against them. But more on that at the end of this article.
The key thing when it comes to finding value is to look for the best odds on your chosen selection.
It’s quite surprising how much odds can change from bookmaker to bookmaker. This is why it makes sense to shop around. Plus, that gives you the opportunity to take advantage of the bookmakers bonuses and earn free cash.
There are numerous sites on the internet for you to find best odds. The best free one is oddschecker. Here, you can look at your chosen market and compare prices from every bookmaker.
There are also other paid services which have tools that allow you to find all the latest odds. OddsMonkey’s tool is OddsMatcher which finds and analyses odds and then compares bookie against betting exchange. By backing and laying the same selection, you can extract value from bookmakers’ free bets and turn them into real money!
…This is called matched betting.
To find out more, please download our free Introduction to Matched Betting.