Interested in sports betting but unsure how to understand the odds? Fear not, our complete guide to understanding betting odds below will tell you all you need to know about how to read betting odds.
Welcome to the only place you’ll ever have to visit to learn how to read betting odds. If you’re new to the world of sports betting sites, it may look a bit daunting at first but we’re here to shed some light on how it works and hopefully turn you into a pro in a matter of minutes. There are hundreds of sportsbooks available online and while their offers and promotions differ, how to read odds will always be the same.
This doesn’t mean that real money sportsbooks will offer the same odds on the same events, and we’ll explain why further down, but they will display odds exactly the same. You will come to learn that there are three different ways odds can be presented: American, fractional, and decimal. There’s no difference in how they pay out on winning bets. They’re merely different ways of presenting odds.
We’ll walk you through how to read betting odds on all three types and how to swiftly calculate your potential winnings on single-event bets. If you’re planning to rack up winnings from parlay bets, then it’ll be a little more complicated, and knowing how to read betting odds will not be enough. But don’t worry. There are betting calculators out there to help you along and we’ll go through the ones you’ll need.
Now that you know what to expect from this guide on how to read betting odds. Let’s get started by explaining what betting odds are and how they are determined.
Essentially, betting odds are a representation of what you need to wager or what you could win (or both wager and win) depending on how they are expressed. Sportsbooks use complex algorithms to determine their odds, and odds can change at any given moment depending on external factors.
It’s easy to understand that the Los Angeles Lakers would be heavy favorites to win against Sacramento Kings. But if LeBron James and Anthony Davis are both unavailable to play for whatever reason, the Kings’ chances of winning would definitely be improved. Which would move the odds to show the level playing field.
This is only one way how to read betting odds. Without any knowledge of LeBron and Davis not playing, you’d still be able to figure out that something’s up because the odds are closer than they normally would be. Now, let’s go into the three different ways odds are presented in sportsbooks.
How to read betting odds in the American format is easy to understand as long as we’re talking about betting on a single outcome. But as soon as we get into calculating odds for parlay bets or potential winnings or risks for smaller amounts, American odds quickly becomes harder to calculate than cracking the DaVinci code. The system is based on asking two questions:
- How much must I bet to win $100?
- How much do I win if I bet $100?
Here’s how it works. American odds are presented as a number with a plus sign (+) or minus sign (-) in front to indicate which outcome is the favorite and which is the underdog. The favorite is the one with a minus sign.
If you want to bet on the favorite to win on the moneyline and the odds are -250, then you would have to bet $250 to win $100. Conversely, if the odds are +250, then you would win $250 with a $100 wager. It’s all well and good as long as you’re willing to bet with hundreds. To bet smaller or bigger you will have to do some maths to figure out the risk/reward potentials.
First, you need to convert American odds into decimal numbers:
- Negative odds formula using the above examples
1 minus (100 divided by odds) e.g. 1 – (100/-250) = 1.4
- Positive odds – same numbers
1 plus (odds divided by 100) e.g. 1 + (250/100) = 3.5
Now that you have the decimal numbers, you simply multiply them with your stake to get your potential payout if you win. If you wager $25 on odds of -250, your potential winnings are $25 x 1.4 = $35. Your stake is always a part of the payout which makes the true earnings in this case $10 (35 – 25).
Parlay Betting With American Odds
Knowing how to read betting odds and converting them into decimals is half the battle. It gets easier from here on. Simply take each decimal number and multiply them all up to the final factor. Using the conversions above a parlay bet with the two outcomes at -250 and +250 (1.4 and 3.5) is simply 1.4 x 3.4 = 4.76. Multiply 4.76 with your stake and you have your winnings.
Adding more bets (legs) to your parlay means that you have more numbers to multiply this way. This is why parlay betting is so popular. With just a handful of bets on a single bet slip, you can reach a very high potential payout even when you’re only betting on massive favorites to win.
And this is how to read betting odds in the American format. Now we’ll take a look at how they do it overseas.
Most people will shy away from calculating fractions, but not in the United Kingdom. They’ve embraced it and now this is how they express odds for sports betting. Fractional odds aren’t that complicated for single outcomes because the formula is straightforward.
- How much do I win/If I bet
It’s self-explanatory when you look at how fractional odds are displayed. It’s also embedded in how we speak when we talk about probability. Fractional odds look like 8/1 or 7/2 and so on, and are spoken as eight to one and seven to two.
In these two examples, you would have to bet $8 to win $1 or $7 to win $2. Calculating bet sizes and winnings get a little tricky but don’t worry, we’re here to show you how to read betting odds also when they’re expressed as fractions. This is how it breaks down for a $10 bet on an outcome with odds of 7/2.
First, we have to assign some terminology to the different numbers to make the formula understandable. The 7/2 is numerator/denominator and the stake is 10. We’ll do this in three easy steps:
- stake/denominator (10/2 = 5)
- result x numerator (5 x 7 = 35)
- result + stake (35 + 10 = 45)
There you have it. A $10 bet on odds of 7/2 pays out $45.
Parlay Betting With Fractional Odds
Let’s see what happens when you bet on a parlay with two events priced at 8/1 and 7/2. Again, we start by converting the fractions which is easy. All you have to do is divide the fractions and then add 1 to get to the decimal number.
- (8/1) + 1 = 9.00
- (7/2) + 1 = 4.50
Then we multiply the decimal numbers and get 9 x 4.5 = 40.5. A $10 bet on this would net you $405. Finally, we’ll look at how to read betting odds with decimal numbers.
By a landslide, this is the easiest way to calculate odds and possible winnings which is why most professional bettors prefer to use decimal odds. You will probably still need a calculator, but at least you can skip straight to the good stuff and skip all those pesky conversion formulas.
Rather than asking yourself how much you have to stake to win or wrap your head around how to read betting odds with complicated conversions, understanding decimal odds is a walk in the park.
There are two things you need to know and neither requires maths. The lower decimal number is the favorite, and the wider the gap to the opposite outcome the more favored the other outcome is to win. In other words, odds of 1.10 vs 9.90 is a massive favorite to win.
To calculate your winnings potential, just multiply your stake by the decimal number.
Parlay Betting With Fractional Odds
With all the conversions already done for you, adding legs to your parlay and figuring out the possible gain is simple. Add as many legs as you want and then multiply them all together and then multiply the answer with your stake. We probably don’t need to give you an example of how to read betting odds here.
Let’s kick it up a notch and discuss the implied probability of your bet slip bearing fruit once you’ve settled in with your selection(s). We use implied probabilities in everyday language without paying attention to how we get to the chance of something happening because most of the time we simply pull numbers out of thin air.
Next time you listen to the weatherman and he talks about the chance of precipitation, you’ll hear him say it as a percentage. “Tomorrow there’s a 75% chance of precipitation,” for example. But how did he arrive at that number? By calculating the implied probability.
Here we’re going to show you how to calculate the probability, as a percentage, of any bet winning using all three types of odds. Obviously, decimal odds are the easiest – again.
- American Odds
Positive odds – We are going to stick with an easy number (+100) for the sake of maths here. Start by adding 100 to the odds (200 in total), then divide 100 with the total (100/200), and finally you multiple with 100 to get the percentage. In this case, it would be 0.5 x 100 = 50%.
Negative odds – Start by removing the minus sign in front of the odds (-400) and then add 100 (500). Now, divide the odds (400) with the result (500) and you get 0.83. Multiply by 100 and you get to 83%. That’s a decent percent chance of winning.
- Fractional Odds
Let’s use a number from earlier (7/2) to see what the implied probability is of this happening. Begin by calculating the fraction 7 divided by 2 and then add 1 (4.5). Divide 1 by 4.5 (0.22) and multiply by 100. This gives a 22% chance for this to happen.
Easy! Take 1 and divide it by the decimal odds and then multiply by 100. We won’t provide you with an example here. It’s too easy.
To apply the implied probability is more of a gut feeling. If you are XX% confident that an outcome will happen. Then go ahead and place your bet.
Betting Calculators To Use
All of the things you’ve learned so far can be done in a matter of seconds when you use betting calculators. The best sportsbooks usually have them at the ready on their sites. Simply fill out the fields and click the button to get the answers you’re looking for.
Still, understanding the computations for how to read betting odds is incredibly important. What if you lose your internet connection or your smartphone runs out of battery? Then you have the advantage of going old school and using a pen and paper.
The betting calculators you want to be on the lookout for are the parlay and odds calculators. These will handle all the computations in any odds format.
Bet Like A Pro On Any Sport
We’ve shown you numerous examples of how to read betting odds in different formats and how to convert them into implied probabilities. Armed with this new knowledge you can bet like a pro on any sport by doing some quick calculations.
Sportsbooks don’t always offer the same exact odds on the same outcomes because they have to be competitive against each other. And they use implied probabilities to move the line to give themselves an edge. You can easily get the upper hand by signing up with several sportsbooks so you can compare odds between them and make sure you’re always getting the best price for your money. There is also the opportunity to place a wide variety of bets such as parlays, hedge betting, spread betting, futures betting, moneyline betting, over/under betting and more.
Apply what you’ve learned here today to improve your betting strategies by taking calculated risks that’ll see your winnings increase over time. Remember, you can always come back here if you need to jog your memory.