When it comes to betting, the first thing you need to understand is the odds. Odds represent the probability of an event occurring, and they are essential in helping you make informed bets.
There are three basic types of odds: decimal, Moneyline, and fractional. In this article, we’ll cover all of these types, show you how to read them; for example, how to read NFL odds, and how you can calculate implied probability from them.
How to calculate implied probability from betting odds
Okay, so let’s first see how you can calculate implied probability from betting odds. The most common method to calculate implied probability from betting odds is to use the odds ratio.
To calculate the odds ratio, simply take the odds of your bet and divide it by the sum of the odds of your bet plus the odds of not winning your bet. For example, if you’re betting on a horse with odds of 3/1, you would divide 3 by 4 to get an odds ratio of 0.75.
This number can then be converted into a percentage by multiplying it by 100. So, in our example above, an implied probability of 75% would be calculated.
Understanding betting odds
Now, let’s learn how betting odds work!
Betting odds are a way for sportsbooks to level the playing field and ensure that they make a profit on every bet. The odds represent the probability of an event occurring, and the sportsbook sets them in order to encourage betting on both sides.
To make informed bets, you need to understand how the betting odds work. The most common type of bet is the Moneyline, which is a bet on which a team will win a game. The Moneyline is expressed as a number with a plus or minus sign in front of it. The minus sign is before the favored team, and the plus sign is placed before the underdog team.
The number next to the plus or minus sign indicates how much you need to bet in order to win $100. For example, if you see -110 next to a Moneyline, it means you need to bet $110 to win $100. If you see +105 next to a Moneyline, it means you need to bet $100 to win $105.
How to calculate winnings with betting odds?
To calculate your winnings from fractional odds, you simply multiply your stake by the numerator (the top number) and divide by the denominator (the bottom number). For decimal odds, you multiply your stake by the decimal odds and add your stake to the total. For Moneyline odds, you divide 100 by the Moneyline odds to get a percentage, and then multiply your stake by that percentage to calculate your winnings.
For example, if you bet $10 on a horse with fractional odds of 3/1, you would multiply $10 by 3 and divide by 1 to get $30 in winnings. If that same horse had decimal odds of 4.0, you would multiply $10 by 4 and add your $10 stake to get $40 in winnings. And if that horse had Moneyline odds of +300, you would divide 100 by 300 to get 0.33333, multiply that by your $10 stake to get $3.33 in winnings, plus your original $10 stake.
