EVER had a hunch on an upcoming match, but missed out on a potential profit because you didn’t know how to read betting odds?
While they might look confusing, betting odds are simply the language bookmakers use to communicate probability.
Knowing how to translate this language can elevate casual gambling to calculated strategy. This article will help you take your first steps into market analysis and teach you how to walk the line between risk and return.
What are betting odds?
Betting odds are the bookmaker’s assessment of the probability that an event will occur.
The number represents the ratio between your stake and your potential winnings, which means that reading betting odds reveal two things:
- The chance of a specific result happening (or at least how the bookmakers see it)
- Potential profit if the event occurs
Accurate odds are integral to the bookmaker’s business model – meaning any errors are a golden opportunity for punters.
How do betting odds work?
Bookmakers calculate odds to make sure books are balanced, then adjust the numbers to guarantee profit regardless of an event’s outcome. This is known as the house edge.
Once published, odds can move for a number of reasons. The amount of money wagered can shift odds to encourage the market to balance. Information (such as player news, scheduling changes or scandals) being released before the event will also affect the odds.
If the bookies fail to factor something into their odds, this could be a good opportunity to place a bet. This won’t be visible from the odds alone, so you’ll need to analyse the data first.
📖 How to read betting odds
So, that’s odds explained – but what do you do with them?
Here’s a breakdown of the three main types of odds formats you’re likely to encounter, plus a couple of examples of how to calculate your potential winnings:
Fractional odds
In the past, UK bookmakers only displayed odds as fractions. This tradition still features in betting markets, particularly around sports such as horse racing.
The fraction shows the ratio of profit to stake. For example, let’s say you bet £1 on a horse to win at 5/1. If they win, you’d receive a total payout of £6: a £5 profit, plus your £1 stake returned.
When the first number in the fraction is larger than the other (as in our 5/1 example), this is known as an odds-against bet. These are given to outcomes the bookmaker deems as less likely. Odds where the first number is smaller than the second (e.g. 6/7) indicate that the bookie thinks the event is likely – these are known as odds-on bets.
Decimal odds
Punters are likely to encounter decimal odds on most UK betting sites. Luckily, they’re the format that makes it easiest to work out exactly how much money you’ll get back.
To calculate your potential payout, simply multiply your stake by the decimal. For example, if you put £10 on Manchester City at 3.00 and they won, your total return would be £30 (£10 x 3.00). Your payout will include your £10 initial stake.
American odds
Also known as moneyline odds, American odds are displayed as a single whole number.
This number will be positive or negative depending on whether you’re betting on a favourite (the likely winner) or an underdog.
If you win, your stake will be returned alongside your winnings – regardless of whether you bet on an underdog or a favourite.
Favourite odds are written with a minus (-) sign. This is the price of how much you’d have to stake to win £100. For example, you’d need to wager £300 on -300 odds to win £100.
Underdog odds have a plus (+) sign and represent how much you’d win on a £100 stake. If you correctly bet £100 on Chelsea to win at +100, you’d secure a payout of £200.
Here’s a conversion chart to help you understand match odds and their meaning in other markets:
| Fractional (UK) | Decimal (EU) | American (US) | Implied Probability |
|---|---|---|---|
| 4/1 | 5.00 | +400 | 20% |
| 2/1 | 3.00 | +200 | 33.3% |
| 1/1 | 2.00 | +100 / -100 | 50% (Evens) |
| 1/2 | 1.50 | -200 | 66.6% |
| 1/4 | 1.25 | -400 | 80% |
🧮 The value calculator: How to calculate probability from odds
So now you can read odds – but can you spot the value?
Every number on a betting site represents the bookmaker’s view on the likelihood of an outcome. To find value in the market, punters must turn these numbers into percentages and see if the bookies have made an error.
Implied probability is the likelihood of an event based on the odds. Comparing this to your own predictions can help you spot value betting opportunities.
Calculating implied probability from decimals
Most football punters use decimals to calculate the chance of an outcome. The formula to deduce implied probability from decimal odds is simple:
| Implied probability = (1/decimal odds) x 100 |
Let’s say a bookmaker offers Manchester City to win at odds of 2.50:
Implied probability = (1 / 2.50) x100
= 0.4 x 100
= 40%
So in this case, there’s a 40% likelihood of Manchester City winning
Calculating implied probability from fractions
Since fractions represent a ratio, the formula is slightly different. Each part performs a different function in the equation:
| Implied probability = denominator / (denominator + numerator) x 100 |
Let’s use horse racing as an example, since a typical UK racecourse will only offer fractional odds. If a horse is given odds of 4/1, here’s what you’d do:
Implied probability = 1 / (1 + 4) x 100
= 1 / 5 x 100
= 0.2 x 100
= 20%
It’s always worth calculating implied probability when placing single bets. If you’re planning a more complex wager, there are a couple more things to consider.
🔎 Common bet types and how odds apply
Generally speaking, lower odds offer higher payout potential, but come with greater risk. Here’s a breakdown of the main bet types you’re likely to encounter:
Singles vs accumulators (parlays)
A single is a wager on one outcome, whereas an accumulator is a combination of bets on multiple occurrences.
To find the odds for an accumulator, multiply the decimal odds for each selection together. If you’re working with fractional odds, convert them into decimals first using this formula:
| Decimal odds = (numerator / denominator) + 1 |
Accumulators carry higher potential total returns since they’re higher risk bets than singles. The catch? Mathematically speaking, you’ve got a lower chance of success.
Each-way bets
An each-way bet is a two-part wager. Your stake is split equally between both outcomes: half on your selection to win, half on your selection to place.
If your selection wins, both halves of your bet will pay out. If they place, your payout will be calculated as a fraction (e.g. a quarter) of the odds of them winning. The amount of places will depend on the number of participants in the event.
Each-way betting is a popular option in markets with multiple contestants like horse racing. There’s a host of events (such as the Grand National) with a large number of participants, which increases the number of places on offer.
The spread and handicap
Some competitions have very clear outcomes. Instead of offering short odds-on favourites that aren’t worth the risk, bookmakers will create a handicap (also known as a spread).
Handicaps effectively bring the probability of either side winning closer to 50%. This is done by adjusting the line to make the price of both teams closer to evens.
If Manchester City were predicted to beat Chelsea in a Premier League game by a landslide. If you bet on ‘Chelsea +2’, you would approach the game as if Chelsea had started two goals up.
🎛️ Choosing the right bet type for the odds
Sometimes, the odds on a favourite are so low that you’d have to risk an inordinate amount to get a significant return.
In this case, a smart punter would look to options like a handicap, or betting on the order of finishers (in horse racing). These bet types can offer opportunities for higher payouts with lower stakes.
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❓ FAQ
1. How do football odds work?
Football odds are the prices to wager on teams. They also indicate the likelihood of different outcomes. Odds of 4/5 on Manchester City to beat Chelsea in the Premier League tells you that the bookies think City have a good chance of winning the game, and helps you calculate the amount of money you could get for your stake.
2. What are good odds in betting?
Good odds carry high profit potential with low levels of risk. A smart punter will use their knowledge of a competition to ascertain the true probability of a result, then use a bookie’s odds to compare this to its implied probability.
If the former is considerably higher than the latter, this could be a value betting opportunity.
3. What does odds-on mean?
If a bookmaker thinks an event is more likely to happen than not (the probability is over 50%), this is known as an odds-on bet. This could be displayed as a fraction where the numerator is less than the denominator, or a decimal number between 1.0 and 2.0.
It’s harder to make significant profit on your stake when betting on a favourite, so keep this in mind when formulating your strategy.
About the author
Craig Mahood
Craig Mahood is an expert in sports betting and online casinos and has worked with the company since 2020. He joined the Betting & Gaming team at The Sun in June 2022 and works closely with the leading bookmakers and online gaming companies to provide content on all areas of sports betting and gaming. He previously worked as a Digital Sports Reporter at the Scottish Sun, covering Scottish football with particular focus on Celtic and Rangers, As well as football, he has covered horse racing, boxing, darts, the Olympics and tennis for the Sun.
Remember to gamble responsibly
A responsible gambler is someone who:
- Establishes time and monetary limits before playing
- Only gambles with money they can afford to lose
- Never chase their losses
- Doesn’t gamble if they’re upset, angry or depressed
- Gamcare – gamcare.org.uk
- GambleAware – GambleAware.org
Read our guide on responsible gambling practices.
For help with a gambling problem, call the National Gambling Helpline on 0808 8020 133 or go to gamstop.co.uk to be excluded from all UK-regulated gambling websites.