Before you start betting, whether it be sports betting, casino gambling or other forms of wagering, it’s important to fully understand the betting odds. Understanding how to read odds and how they work can make a significant difference in a player’s potential wins.
What are betting odds? Essentially, betting odds are your chances of an outcome occurring. The odds determine how much you stand to win after wagering a certain amount. The more that you stand to win, the odds of winning are less likely.
There are three main types of odds:
- Fractional odds
- Decimal odds
- Moneyline odds
While these types of odds are formatted differently, the odds of winning remain the same with each.
Fractional odds, also known as “British odds”, “UK odds: or “traditional odds”, are popular with British or Irish bookies and are typically written with a slash or hyphen. For example, 6/1 or 6-1 would mean that you could win $6 for every $1 you wager as well as get the amount you wagered back. In other words, 6/1 is the ratio of the potential profit to the initial bet. Therefore, if you stake $10 at 6/1 and win, you’ll get a total payout of $70 ($60 profit + $10 stake).
Decimal odds are popular with online gaming sites in Europe, Australia, Canada and New Zealand. They are easy to understand and calculate the favourites and underdogs. Total payout equals a decimal odd number multiplied by a stake. For example, a betting website has listed the odds for two baseball teams:
- Blue Jays: 3.00
- Cardinals: 1.40
The numbers indicate what you can win for each dollar you stake. Thus, if you bet $10 on the Blue Jays, you can win $10 multiplied by 3, which is $30. The amount has included your $10 stake, and your profit will be $20.
If you decided to place a wager for the Cardinals to win, the payout would be 1.4 X $10 if you staked $10. The return would be $14. Minus the money you staked, your profit would be $4.
The probability of the Cardinals winning was higher. The higher the decimal odds, the lesser the chance of winning.
Moneyline odds are also known as “American odds” and are accompanied by a plus (+) or a minus (-) sign. A negative sign indicates the team favoured to win and a positive sign indicates the underdog.
For example, the team likely to win (negative odds) may have odds shown as -150 which indicates the amount that would have to be wagered to win $100. The team less likely to win (positive odds) would have odds show as +150 which means if you wagered $100 you would win that amount in profit.
To better understand how to calculate American odds, let’s use an example. For instance, there is a basketball game that has the following odds:
- Duke: +585
- Syracuse: -760
The bookmaker has placed odds of +585 for Duke, indicating that the bookmaker has set a lower probability of at least 15% for Duke winning the match. If you place a stake of $100, you can win $585 if Duke wins the game.
When you bet on Syracuse to win, and they are showing as the favourite, you will win $100 when you wager $760. The total payout will be $860. There is a huge difference between the odds, and there is a high probability that Syracuse will win and advance to the next level of the tournament.
Being able to read odds and convert them to your probability of winning is key to help you in determining if it is worth the wager. To convert odds to implied probability, use the following formula:
Implied Probability = [Denominator / (Denominator + Numerator) ] x100%.
This determines the chances of an event happening. So, odds of 2/1 will equate to 3.00 in decimal odds, which in turn, yield a 33.3% chance of an outcome happening.
Odds and Slots
When gambling with slots, the odds of winning are fixed. No matter how you play, the odds remain the same, however payout odds for slot machines vary by machine.
For example, visualize a cookie jar with 20 cookies in it – nineteen are chocolate chip and one is oatmeal. Your chances of pulling out an oatmeal cookie when you reach in is 1 in 20. Each time you reach in for a cookie, your odds remain 1 in 20 because the cookie is replaced each time. It doesn’t matter how you pull it out or when you pull it out, the odds remain the same 1 in 20.
Whether you win on a slot machine depends entirely on randomly drawn numbers generated by the machine’s computers. These numbers determine the game’s outcome before the reels stop.
