Regardless of the level of expertise and betting experience, we are all aware of the fact of how important the odds are. Particularly, we are all aware that understanding odds and the way they are operated can be crucial to making profits by betting. Betting forum members might have witnessed so much talk about the odds as the crucial component that leads to smarter betting which brings higher winnings.
The numbers are there for a reason, and with this article, we are going to help you with the most important segment of betting, which is understanding how sports betting odds work. Particularly, we are going to discuss the odds by defining them and providing you with a framework to understand the odds. The focus is on the most popular odds format, decimal, as well as the means to calculate the probabilities of certain outcomes. For that reason, this text will cover the aspect of probabilities which are closely tied to the odds.
What Are the Odds?
The numbers you see a match in the sportsbook are called odds, and they are meant to indicate how likely is something to happen during a certain sports event, from soccer to dog racing, or else. Generally, the odds represent the probability of certain happening during the match from the betting market perspective. Meanwhile, they can appear in different formats, such as decimals or fractions. Each of these is used in different parts of the world. As the system of decimals is the one used in Europe, this article aims to teach you everything you need about decimal odds and how to operate with them. Keep in mind that there is always a value tied to the odd equivalent in terms of winnings
Understanding the Odds
However, the odds are not easy to understand, especially as they come in different formats that are used in different regions and countries. For that reason, this article will explain the meaning behind the odds and the way you can check the probability value tied to it. In other words, all you need to know about the odds, including the interpretation of probabilities of the odd format used in Europe will be discussed below.
Decimal Odds
Using decimals as the odds format is widely spread outside the US, and is the most popular format in Europe. They are displayed in the form of decimal numbers that imply the likelihood of an event happening during the match. For example, if we got an English League Cup match between Southampton and Newcastle, where the home team is Southampton, the odds might look like something like this:
Home – win 3.90
Draw 3.20
Away – win 1.96.
When it comes down to the calculation of potential winnings, decimal odds make it very easy. Placing a bet on the home-team win, which is Southampton in our example, you will get $3.90 for every dollar invested. Equivalently, placing a bet on a draw will result in $3.20 if it was a $1 bet. For $10 invested on the away team’s win will potentially bring you $19.60.
To calculate the profit, all a player needs to do is deduct the amount of the initial investment. If we have placed $10 on a draw, the calculation of profit goes like this:
Profit = ($10 x 3.20) – $10 =
= $32 – $10 =
= $22
As you can see from the example above, a draw will give you $22 profit on every $10 invested. A win by Southampton would in another case, make you $29 of profit on the same investment, and the probability of 25%. Note that the same formula was used to make the calculation of profit. To remind you, the probability of Southampton’s win was calculated in the following manner:
P = ( 1 / odds ) * 100
P= (1 / 3.90) * 100
P= 0.25 * 100
P= 25 %
Probability in betting
When the odds are created, bookmakers rely on the probability of certain things happening. Lower probability in that context means that there will be fewer chances for some event to occur. In the same manner, higher probability shown in lower odds means that the bookmaker views an event to be more likely to happen. To understand the concept it is always good to remember the old-school method – a coin toss. Heads and tails have a 50% chance to happen each.
Calculating probabilities with decimal odds
Implying probabilities with the use of decimal odds is also not hard with this format. A central part of betting is the calculation of probabilities. Now let’s look at how to calculate the probability of the outcome with decimal odds. Let’s stick to our League Cup example and the match between Southampton and Newcastle. To calculate the probability, we will use the following formula to calculate the probability of a draw:
Probability = ( 1 / decimal odds ) x 100 =
= ( 1 / 3.2 ) x 100 =
= 0.31 x 100 = 31
This implies a 31% of chance of a draw. The same formula applies to the other outcomes, and that will help you determine the value of your bet. A good understanding of the way betting odds work will help you find the value in the bets you plan to place.
What Is to Bet On?
Betting is widely spread around the globe and is banned in only a few spots in the world. Nowadays there are so many things people can place their money on, from sports to social and public activities. However, sport is the most popular, so today there is so much to bet on such to bet on, and each bet has its odds that reflect the likelihood. Some from the top of the shelf include betting on the team’s victory, the number of goals or points, the number of cards shown, and much more. From a bookmaker’s point of view, odds represent the probability of such an outcome. Note that as soon as you get a profound understanding of different odds and the way they interplay you will increase your chances of making a profit.
Conclusion
Knowing how to read the odds is a crucial step to the successful betting that you dream about – the one yielding profits. Although they might appear in a few different formats, the logic and purpose behind them do not change. The odds are there to imply whether a certain outcome is more likely to occur than the other. Betters utilize the odds for further calculations of the probability of an event happening. The key to the being successful in the game is to find the bet’s value, and it all starts with understanding how betting odds work. It is an inevitable step to becoming a successful sports better or tipster. Understanding odds are a part of the process that will help you bet better, from a decision regarding the amount to be placed on the bet to finding what is the most valuable.