Reading the Odds

A betting price does two jobs at once. It tells you how much you would get back if the bet wins, and, read the right way, it tells you how likely the bookmaker's price says that outcome is. The same price can be written in three different formats depending on where you are. Once you can translate between them, every price board becomes easier to read. All of the numbers below are invented examples, chosen to make the arithmetic easy.

Decimal odds

Common across Europe, Australia and much of the online world, decimal odds show the total return for every one unit staked, with the stake included. At a price of 2.50, a stake of 10 returns 25 if it wins: your 10 back plus 15 profit. A price of 2.00 doubles your stake, and anything below 2.00 returns less profit than you put in.

Fractional odds

Traditional in Britain and Ireland, fractional odds show profit relative to stake, without the stake itself. 3/2 means you win 3 for every 2 you risk, so a stake of 10 brings 15 profit — exactly the same bet as 2.50 in decimal. "Evens" (1/1) means profit equal to your stake. When the first number is smaller than the second, as in 1/4, the outcome is the favourite and the profit is less than the stake.

American odds

American, or moneyline, odds use 100 as an anchor. A plus sign shows the profit on a 100 stake: +150 means 100 wins 150. A minus sign shows how much you must stake to win 100: −400 means risking 400 to make 100 profit.

One price, three ways

To convert by hand: add 1 to a fraction to get decimal odds (3/2 becomes 1.5 + 1 = 2.50). For a plus American price, divide by 100 and add 1; for a minus price, divide 100 by the number and add 1.

Implied probability

Divide 1 by the decimal odds and you have the probability the price implies. A price of 4.00 implies 1 ÷ 4 = 25%. This is not a forecast of what will happen; it is simply the chance at which the bet would break even over many repetitions. If the true chance is lower than the implied one, the bet costs you money on average, however attractive the payout looks.

Where the margin hides

Add up the implied probabilities of every outcome in a market and the total will usually come to more than 100%. Imagine a tennis match where both players are offered at 1.90. Each price implies about 52.6%, so together they make roughly 105.3% — for an event that can only have one winner. The extra 5.3 points is the bookmaker's margin, sometimes called the overround.

A made-up three-way football market shows the same pattern:

• Home win at 2.20 — implied 45.5%
• Draw at 3.40 — implied 29.4%
• Away win at 3.50 — implied 28.6%

Total: about 103.4%. Dividing each figure by 1.034 strips the margin out and gives the bookmaker's underlying view, roughly 44%, 28% and 28%.

What odds cannot tell you

Understanding a price is not the same as beating it. Prices are set by people and models with far more data than any casual bettor, and the margin is there on every market. Treat bets as entertainment you pay for, set a budget first, and read our page on gambling responsibly. For a broader introduction to markets, see the easiest sports to bet on for beginners.