If you're entering the betting world, whether it's a casino, sports betting or any other kind, it is crucial to understand the odds. Placing some good bets requires understanding all the main types of betting odds and the ability to interpret the different associated formats.

Betting Odds Explained

Knowing how betting odds work allows you to understand how an event is likely to happen and the winning potential behind it. It may seem unclear at first, but this guide will help you understand betting odds.

In betting, odds represent the ratio between how much you've staked to a bet. Therefore, odds of 3 to 1 mean that the bookmaker stakes three times the amount staked by the bettor.

What is Probability?

When you come across two numbers separated by a trailing slash, i.e. 3/1, this is fractional odds. This odd can calculate how likely an event is expected to happen with a calculation. To simplify the explanation, let's replace the numbers 4/1 with letters such as A/B with the math: Probability (%) = B / (A+B).

  • 4/1 can be calculated as 1 / (4+1) = 0.20. Meaning there's a 20% chance for the event to happen.
  • 9/1 can be calculated as 1 / (9+1) = 0.10. Meaning there's a 10% chance for the event to happen.
  • 1/4 can be calculated as 4 / (4+1) = 0.80. Meaning there's an 80% chance for the event to happen.

We can now determine how likely the event we're betting on will happen with fraction odds. Next, let's look at how much money can we earn when using betting odds.

Calculate Winnings with Betting Odds

Betting odds lets you calculate how much money you can win from betting—using an odds calculator and the same example as before, with the same replacement of numbers to letters like 3/1 into A/B. For every value of B that you bet on, you'll win A, along with the return of your stake.

  • 9/1 for every $1 you bet, you'll win $9.
  • 4/1 for every $1 you bet, you'll win $4.
  • 1/1 for every $1 you bet, you'll win $1.
  • 1/4 for every $4 you bet; you'll win $1.

Calculating Probabilities with Decimal Odds

Decimal odds are more common on betting exchanges like Betfair. However, all leading bookies offer you the option to view betting odds in this format. Decimals are an alternate option to looking at the odds in fraction format, and it's indeed easier to calculate. The calculation: winnings = (odds*stake) – stake. We'll look at them with some examples.

  • 9.0 is calculated as (9.0*$10 stake) - $10 stake = $80 winnings
  • 4.0 is calculated as (4.0*$10) - $10 stake = $30 winnings
  • 1.25 is calculated as (1.25*$10 stake) - $10 stake = $2.50 winnings
  • 2.5 us calculated as (2.5*$10 stake) - $10 stake = $15 winnings

Examples for Calculating Odds in Football Betting

To understand the information easier, let's look at a quick example of a bet in a football match,

If you're betting on Manchester City to beat Chelsea 2-0, you might look at the odds for that outcome at 3/1 (fractional) or 4.0 (decimal)

  • You can get straight into calculating your potential winnings if you take $10:
  • You can calculate 4.0 odds as 4.0*$10 stake - $10 = $30 winnings
  • 3/1 for every $1 you bet gets you $3 - $3 winnings
  • Keep in mind that you'll get your original stake back as well.

Should You Choose Decimal Odds or Fractional Odds?

One odd format isn't better than another, but there's an emerging trend where people are shifting towards decimal odds. Fractional odds have traditionally been used in the UK. There are two main differences between these odds.

Decimal odds are easier to understand. Due to this, there's been some movement to get more people into horse racing by making it easier for the average bettor. A few decades ago, bettors going to Cheltenham would only see fractional odds. Today, most of them are in decimals.

The second difference between the two odd types is that fractional odds only show winnings and don't include the returned stake compared to decimals which have these stakes. The shift from fractional odds to decimals is mainly started from the fast-growing popularity of betting exchanges like Betfair and Ladbrokes.

For odds to slightly change, it's challenging to increase or decrease the chances without making large fractions marginally. These are difficult to compute for the bettor and are not the best way to show the betting odds explained. We also have some tips on how to use trends to get the best betting odds.

Use the Betting Odds Conversion Tool to Choose Your Preferred Format

You may find that your chosen bookie presents the odds exactly how you want it to be. However, to understand them better, you might need to convert them.

Check out odds conversion tools like oddsshark that let you see odds in your preferred format. Besides that, the sites also show how likely the selection is to win.