Understanding Odds in Betting

August 7, 2010 - by mosesbet · Filed Under betting articles 2 Comments 

What are Odds?

In betting, odds are used to determine how much you will get paid for each £1 you wager on an event.  True odds reflect the probability of an event happening in reality, where as the bookies odds include the true odds plus a small premium (called the “juice” or “house edge”).

If players bet on a coinflip for example, the probability of an outcome is 50%.  This will be interpreted into odds by the bookie for you to bet on.  The true odds will be 2.0 (decimal system) or 1/1 (fractional system) for both heads and tails.  This might be interpreted into 2.1 to give the bookie a small house edge.

In online betting, the odds for individually matches will vary across the board and it up to you to find the best deals.  Betfair is the world’s largest betting exchange and claims to have odds 20% better than average.  In either case, the job of the bookies will be to weigh up the probability of an event happening and offer it as odds for punters like you or myself to wager on.  For example, the probability of Rooney scoring in a Man Utd game could be 33%, which means the bookies would promote odds of at least 3.0.

Different Odds Formats

There are 3 main odds formats in online betting however UK punters only really need to be aware of the first two.

Decimal Odds: The most common format that odds are displayed in the UK is decimal odds.  This is a number which you can multiple by your stake to give your expected winnings.  It is very simple once you get used to it and is the most convenient methods for punters in my opinion.

For example: You want to be £5 on an event which has decimal odds of 2.3.  If you win, you multiple the stake with the odds: 5 x 2.3 = £11.50p.

Fractional Odds: Fractional odds are similar to decimal odds and show you how much you win on each staked unit. For example, if you the fractional odds are 5/1, then if you bet £5 you will receive 5 x 5 = £25.

This was a simple example; however fractional odds become more difficult to interpret when there is a bigger denominator.  For example 5/2 is a lot harder to interpret into real winning figures and it can become very messy when using random amounts of units to wager (this is why a “bet calculator” can be very useful in online betting).

If you bet £5 on fractional odds of 5/2,then you need to divide the first number by the second to give you your decimal odds, then multiple this by the amount you wager.  i.e. 5/2 = 2.5.  2.5 x 5 = £12.5.

Lines Betting/Spread Odds: For some bizarre reason, US and Canadian betting uses an entirely different odds system known as the Points Spread (or betting lines) – you can practise this measure at Bodog if you want to experience it for real.

A typical US points spread will look like this: +120 or -140. All you need to remember is that any positive numbers indicate the underdog.  With a handicap of +120 you will receive $120 for betting $100.  Negative numbers indicate the favourite, you’ll need to wager $140 to win $100.

In conclusion, the main 3 betting odds systems are outlined above.  Every betting site allows you to change to an odds system you are comfortable with, which means in reality nowadays you only need to understand the popular decimal system.