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Understanding sports betting odds is one of the most important skills for bettors who want to maximize their potential winnings. Whether you are betting on a football match, basketball game, or another sporting event, knowing how to calculate sports betting odds gives you a clearer view of the probability of an event and the total win you can expect.
Bookmakers use odds to represent the likelihood of an event happening in a game and to determine how much money you can win.
How Do Bookmakers Set Betting Odds?
A bookmaker sets betting odds by analyzing statistics, team performance, injuries, and historical data. The odds are the bookmaker’s estimate of the probability of an outcome, but they also include a margin to ensure income for the house.
Sports bettors who understand how bookmakers set odds can make better decisions about when the odds offered truly reflect the event occurring.
How Odds Represent the Probability of an Event Occurring
Betting odds are more than just numbers; they show the likelihood of an event occurring in a game. For example, lower odds often mean the bookmaker expects a higher probability of an outcome, such as one of two teams being favored in a football match.
Understanding how odds represent an event occurring in a game helps bettors calculate the actual probability and decide whether it’s a winning bet.
What is the Formula for Calculating Betting Odds?
At its core, the formula to calculate odds in sports betting depends on the format you are using. The general formula is:
- Decimal odds: Total Win = Odds × Stake
- Fractional odds: Total Win = (Numerator ÷ Denominator × Stake) + Original Stake
- Moneyline odds:
- Positive odds: Potential Profit = (Odds ÷ 100) × Stake
- Negative odds: Potential Profit = (100 ÷ Odds) × Stake
This shows the link between the odds offered by the bookmaker and the possible outcomes of your bet.
Fractional Odds
Fractional odds, also known as traditional odds or British odds, are commonly seen in horse racing and older sports betting markets.
For example, odds of 5/1 mean that for every unit of money you bet, you can win five plus your original stake. A 5/1 bet with a bet of 100 would give you a win of 500 plus your initial wager of 100, for a total of 600.
Fractional odds are straightforward but can be harder for new bettors to convert into probability.
Decimal Odds
Decimal odds, also called European odds or continental odds, are the standard in digital odds platforms. They represent the total money payout per unit wagered, including the original wager.
For example, if the decimal odds are 2.50 and you place a bet of 100, your total payout is 250, which means a profit of 150.
Decimal odds make it easy to calculate the odds quickly, and sports betting fans looking for a win often prefer this format when comparing the best odds and identifying value bets across different bookmakers.
Moneyline Odds
Moneyline odds, also known as American odds, are popular in US sports betting. These odds numbers are either positive odds or negative odds.
Positive moneyline odds show how much money a 100 bet wins. For example, +200 odds mean you win 200 on a 100 wager, plus your initial bet of 100 for a total win of 300.
Negative odds show how much you need to wager to win 100. For example, -150 odds mean you must bet 150 to win 100, giving a total payout of 250.
What does a +200 odds mean?
If a football game has +200 odds, a 100 bet results in a win of 200, with a total payout of 300.
What does +3000 odds mean?
With +3000 odds, a 100 bet wins 3000 in profit, giving a total payout of 3100. These odds represent a lower probability of an event occurring but a much higher profit.
What does +5000 odds mean?
At +5000 odds, your 100 bet turns into 5000 in profit, plus your original bet. This usually reflects a long-shot outcome with a big difference in true probability compared to the bookmaker’s odds.
American Odds in Sports Betting
American odds are the most widely used in US sports betting. Bettors can use them to calculate the odds for point spread bets, parlay bets, or moneyline wagers.
A parlay bet combines multiple outcomes, and calculating the potential winnings requires multiplying each event’s decimal odds together before applying your stake. However, not every parlay represents a value bet, since combining low-probability outcomes can reduce your chances of winning money on a bet.
Betting Odds and Implied Probability
Implied probability is how the odds represent the probability of an outcome. It allows you to see the true probability behind the odds offered by the bookmaker.
If decimal odds are 2.00, it means there’s a 50 percent chance of that event occurring. By comparing implied probability to your own analysis, you can spot when the odds offered are higher or lower than the actual probability of an event occurring, which can lead to identifying a value bet.
- Decimal odds formula: Implied Probability = (1 ÷ Decimal Odds) × 100
- Fractional odds formula: Implied Probability = (Denominator ÷ (Numerator + Denominator)) × 100
- Moneyline odds formula:
- Positive moneyline odds = 100 ÷ (Odds + 100) × 100
- Negative odds = -Odds ÷ (-Odds + 100) × 100
Understanding implied probability is key to identifying a value bet, where the actual probability is higher than what the bookmaker’s odds suggest. Recognizing a value bet helps bettors win money and maximize their profit.
How to Calculate Odds and Potential Winnings
To calculate the odds, identify value bets, and work out your wins, start by identifying your stake, then follow these steps:
- Identify the odds format (fractional, decimal, or moneyline).
- Apply the formula for total payout.
- Subtract your initial bet to find your net profit.
- Compare the implied probability to the true probability of the event happening in the game to determine whether your bet qualifies as a value bet.
Example:
- Decimal odds 2.20, 100 bet → 220 total win → 120 net profit.
- American odds +150, 100 bet → 150 profit + 100 stake = 250 total payout.
This helps you decide whether the bet represents win value and whether you should place your wager.
Best Odds and Why They Matter
Always shop for the best odds across bookmakers. Even a small change in odds offered can mean more wins in your pocket. For example, getting 2.10 instead of 2.00 decimal odds on a game gives you a higher probability of finding a value bet and earning greater returns.
Bettors who consistently identify a value bet when shopping for the best odds gain a long-term edge over the bookmaker. Over time, consistently placing bets at the best odds makes a huge difference in your profit margin.
By learning how to calculate the odds and recognizing a value bet when it appears, bettors can make smarter decisions and improve their wins across every game.
