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Betting Odds Explained If you have only ever bet with UK bookies then the only odds format you might be familiar with are fractional odds. Modern betting, especially online, is however now a global. All of those who want to remain on top of things and always make sure they get the best odds possible need to make sure they understand how betting margins work.

Arguably, one of the most important things you need to understand in online betting is the value of odds. You can not underestimate the importance of knowing how to use odds correctly. We guide you through what odds are, what they mean and how to find and use the best odds.

Betting odds are there to tell you the likelihood of an event happening; they tell you how much you stand to win. They may seem confusing at first but once you get to know them, it will make your betting life much easier – and much more profitable. Here, at BettingOnline.co.uk we will go into some depth about how to best use betting odds to bring value to your bets.

How Does Probability Affect Betting Odds?

Betting, at the very basic level, is all about your ability to predict what is going to happen in a certain sporting event. If you can correctly predict the outcome, then you will win your money. Any sporting event has a number of possible outcomes. If you roll a die, then there are six outcomes possible. As such, if you bet on one specific number being rolled, then there is a 16.66% chance of winning (100 / 6). Betting odds are designed to represent the likelihood of the event happening. Generally, in the UK, they are represented as fractions, although you can access them as decimals.

Calculating Probability Using Betting Odds

When you see fractional odds, you can use these numbers to calculate the probability of an event happening according to the bookmaker. To explain the calculation, we’ll use the letters A and B for A/B. The probability is calculated with the following formula: Probability (%) = B/(A+B).

Examples:

8/1 works out to be 1/(8+1) = 0.11 – which means that there is an 11% chance that it will happen.

4/1 works out to be 1/(4+1) = 0.20 – which means that there is a 20% chance that it will happen.

1/1 works out to be 1/(1+1) = 0.50 – which means that there is a 50% chance that it will happen.

1/9 works out to be 9/(1+9) = 0.90 – which means that there is a 90% chance that it will happen.

However, the more you know the sports you are betting on, the more you will understand whether the odds offered by the bookmaker represent what you think the probability is.

Value Bets

If you think a football team has a 50% chance of winning but is given odds of 2/3, then the bookie is stating that they are paying out for the probability of 3/(2+3): 60%, which means it is not a value bet. However, if the bookie is offering odds of 2/3, then they are paying out for the probability of 2/(3+2): 40%, which makes it a value bet, that you should snap up.

Calculating Winnings Using Betting Odds Explained

Once you have established whether the odds on offer represent a value bet, you can then establish what you will win if you take up the bet. This really is very simple to work out and you don’t need to be a maths genius to work out your potential winnings. Let’s again use A/B to represent odds. The way to work it out is that for every B you bet, you stand to win A, as well as getting your original stake back.

Examples:

8/1 – every £1 you bet means you will get £8 plus your original stake

4/1 – every £1 you bet means you will get £4 plus your original stake

1/1 – every £1 you bet means you will get £1 plus your original stake.

1/4 – every £4 you bet means you will get £1 plus your original stake

Understanding Decimal Odds

If you want to bet on exchanges or more European betting sites, then you may find that the odds are generally represented by decimals. Some people prefer decimal odds, and as such, many sites give you the option to view all odds in decimals if that is your preference. Many people actually find these easier to work out than fractional. As such, they are also very important to understand. The calculation is as follows: winnings = (odds x stake) – stake. Here are some examples of how decimal odds work.

Betting Odds Explained Negative

8.0 works out to be (8.0 x £10 stake) – £10 stake = £80 – £10 = £70

4.0 works out to be (4.0 x £10 stake) – £10 stake = £40 – £10 = £30

2.5 works out to be (2.5 x £10 stake) – £10 stake = £25 – £10 = £15

1.25 works out to be (1.25 x £10 stake) – £10 stake = £12.50 – £10 = £2.50

What Works Better, Decimal or Fractional Odds

What is better very much depends on what you are used to – and one really isn’t better than the other. Fractional odds are more traditional than decimal odds, but decimal odds are coming more into fashion. Fractional odds were originally used in the UK, most predominantly at the race tracks and in high street bookmakers. There are a couple of differences between them. Most beginners and people new to betting find decimal odds easier to understand. Because of this more UK high street bookies have made them more available to their punters to attract more punters. They are also widely available on online betting sites. When you go to any major horse racing event, including Cheltenham, in the past, you would only be able to access odds in fractions. Now, you can generally see them available in fractions.

Another difference is that fractional odds represent the winnings only, whereas decimal odds represent the winnings plus the stake you get on return. Because of these differences, we’re generally finding that more sites and bookies are transitioning to decimals. Decimals are generally used in betting exchanges also, which are becoming more popular with punters. Also, when odds decrease or increase slightly, this is easier to represent in decimals as fractional odds tend to have very high number fractions involved, which make calculations harder for the punter.

Making the Most of Odds Comparison

When you understand odds, you need to make sure that you get the best odds available for your particular bet. The odds offered at different bookies represent what is going on in their market for that event. As such, these can vary from bookie to bookie. If there are too many people making a bet on one outcome, then bookmakers will change odds to lure punters to bet on a different outcome. As such, this could lead to a skew of good value and bad value odds. Therefore, you can either look through all different online bookmakers to check out where the best odds lie, or you can use our odds comparison site to help you. Taking time to compare odds yourself can be very time consuming, so getting a helping hand makes it much easier. You can find the best tips and the best odds for your bets here on our site.

To Sum It Up

Betting odds are the most important thing you need to understand when it comes to online betting so you can understand values and winnings. As soon as you get the hang of the odds, you can understand the likelihood of an event happening – and how much you stand to win if it does happen. Getting good value odds and the best odds is a major part of successful betting.

If you have only ever bet with UK bookies then the only odds format you might be familiar with are fractional odds. Modern betting, especially online, is however now a global affair and depending on who you bet with it is now common to see other odds formats including decimal odds, percentage odds, proportional odds and American Odds (referred to as moneyline).

Betting companies based in Europe in particular will generally provide odds in decimal format by default, and this can make calculating fixed odds prices a little difficult to the uninitiated. Even with UK bookmakers many bets are represented as decimals, such as most handicap markets. Not to worry, in this article we explain the difference between odds systems and how to calculate, compare and convert fixed odds winnings using any format.

• Odds:

Odds Format Comparison and Conversion Table

Types Of Fixed Odds Formats

Quick Reference

By treating the amount you can win as 'Z' we can easily summarise different odds types.

• Fractional Odds - the number on the left displays the amount you can win from a given stake (Z).
• Decimal Odds - display the amount you can win from a stake of one unit stake, plus your stake (Z + 1).
• American Odds - positive odds are simply multiples of 100 (Z x 100), negative odds are division of 100 (100 / Z).

Fractional Odds

This format is most familiar in the UK and Ireland and continues represents the most common format. At the end of the day if we haven't given up miles, yards, feet and inches yet in the UK so it will be a long time until we switch to decimal odds as default. Think of a betting shop window, have you ever seen anything but fractions?

The fraction is a mathematical representation of the amount a punter can win (first number) versus the amount they need to stake to win that amount (second number). Therefore 4/1 means you for every £4 you want to win you need to stake £1. The first number represents what you will win excluding your stake, so if you were to place a £1 bet at 4/1 you would win £5 but also get your £1 stake back giving you total returns of £5 if the bet win (£4 winnings + £1 stake).

Fractional odds must always be whole numbers. If potential winning are not divisible by 1 as a whole number then the stake unit increases to the closest whole number representation. If you had a price of 3.5/1 it cannot be written this way so in this instance it becomes 7/2, this is the closest whole number derivative of that price. In the case of a price that was say 3.3333/1 this would be represented as 10/3 and so on, see odds table above.

If something is odds-on it means for each unit you stake you will receive less than one unit back in winnings. In the instance of 1/4 for example for each £1 you want to win you need to stake £4. If your winnings are equal to your stake then the odds are 1/1 but this is commonly referred to as Evens.

When betting on an each-way price for example you will often need to work out your own each way odds. If you back a horse at 12/1 each-way at one quarter of the total odds and the horse were to place the place part of the bet would be paid out at 12/4 or 3/1.

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I like to think of fractional odds like bet you would place with your mate where you don't actually part with your stake. For 4/1, you say if you win I will give you £1 but if I win you give me £4.

Decimal Odds

The favoured odds format in Europe, Australia, New Zealand and Canada. Effectively anywhere where you drive in kilometres per hour bookies will use decimal odds. Luckily decimal odds are not too hard to understand and once you have encountered them a few times it is easy to convert from decimal to fraction (or vice versa) in your head.

The decimal represents the amount you would win including getting your stake back. 4/1 in fraction therefore now become 5.0 in decimal, here you are staking £1 and getting returns of £5, your winnings are still £4 it's just that the price included getting your stake back.

Taking the example from fractional odds above for decimal odds you are having a bet but giving your stake away. For 5.0, you say I will give you £1 now but if I win you give me £5 back.

Betting Odds Explained Uk Today

The equivalent of evens (1/1) in decimal is 2.0 this is one unit stake and one unit winnings (1+1=2). A line that is odds-on in decimal format will always be a decimal of 1, so for example 1/4 (£4 stake for every £1 won) in decimal would be 1.25.

If you want to a quick way to work out your winnings in decimal format simply multiply what you want to stake by the decimal. For example if you stake £5 at 3.0 (2/1) then multiply 5 x 3.0 giving returns of £15. If this were odds on, say 1.40 (2/5) multiple 5 x 1.4 this gives £7 returns, etc.

In the case of an each way bet with decimal odds, using the previous of a 12/1 horse this would be 13.0 in decimal. If you back this each-way and it places at one quarter the odds unlike fractional you can't just divide the winning odds by 4. First subtract the stake (13-1) then divide by 4 (12/4 = 3) and add the stake back (3+1=4). The decimal odds for the place would therefore be 4.0 (3/1).

Decimal odds tend to be favoured by betting exchanges such as Betfair and in index, financial and spread betting.

American (Moneyline) Odds

As it says on the tin these odds are favoured in America and are a little different to fractional and decimal odds as these can be both positive and negative numbers.

Positive American Prices

If a betting line is favourable (i.e. you can win more than one unit per one unit stakes) then American odds are positive. This tells you how much money will be won for each £100 wagered. If a money line shows +400 this means for every £100 stakes you will win £400, this is equivalent to 4/1 in fractional or 5.0 in decimal.

Negative American Prices

Conversely if the odds are unfavourable (odds-on, i.e. for each one unit stakes you will win less than one unit) then American odds are displayed negatively. This time the moneyline quotes the amount that must be wagered to win £100. In this instance if the American odds are showing -400, meaning you must stake £400 for each £100 winnings, this is equivalent to 1/4 in fractional or 1.25 in decimal.

Percentage and Proportional Odds

It is rare to see but occasionally you may see your chances of winning represented as a percentage. These are not odds prices as such but instead show the percentage of winnings relative to stake or the percentage of times you need to win to break even. A proportion is just a percentage divided by 100.

Betting Odds Explained Uk

Percentage win for a 4/1 bet would therefore be 400%, meaning you will win 400% of your stake (very similar to positive American Odds). Conversely an odds-on line like 1/4 would be 25% winnings relative to stake.

Betting Odds Explained Uk Horse Racing

The percentage win to break even represents the number of times a bet at those odds would need to win so that you didn't lose overall. Taking our consistent example of 4/1 you would need to win 20% of the time to break even. An odds-on line such as 1/4 would need to win 80% of the time to break even. For more see the table at the top of this page.