How Do Betting Odds Work?

If you want to find success by betting in sports, learning what odds mean in betting is crucial. You may assume that this is going to be difficult, but if you give it time, you can read the odds easily and apply them to bring success. 

Understanding how to read odds and how odds in sports betting work will help you find out, utilise value in a betting line, determine pay-outs, and bet size better. 

If you are new to betting, you can expect to learn useful things about betting odds and how to use that to your advantage. 

What are Betting Odds? 

In simple terms, bookmakers use betting odds to represent their stance or opinion on the likelihood of something happening on a specific game, proposition or event. 

Betting odds can also be used to reflect how much players can win (potentially) if they bet on a particular market. 

High and low odds imply that (in the eyes of the bookmaker) the outcome is respectively less and more likely to occur. 

What is Implied Profitability? 

Bookmakers determine implied probability, which represents the expected chance of an outcome, and express it through odds.

It is crucial to convert odds into implied probabilities to most accurately assess the potential value of a bet. If you assess a team's chances of winning at 60%, yet the implied probability set by the sportsbook is 40%, you potentially hold an advantage over the sportsbook.

If you want to be a serious bettor, it will be worthwhile for you to learn the somewhat tricky maths behind the conversion process of odds to implied probability. 

The equation is a little different for favourites and underdogs: 

Implied Probability for favourites = Odds/(Odds +100) x 100

Implied Probability for underdogs =100/(Odds +100) x 100

Let us use this formula for a hypothetical game: 

Team 1 has moneyline odds of +115

Team 2 has moneyline odds of -120

The implied portability for Team 1 is 46.51% and for Team 2 it is 54.54%. 

How to Read Betting Odds?

The first step in learning how odds work in betting is to learn how to read betting odds. Players can calculate potential profits from winning bets using odds, a task achievable with both fractional and decimal odds.

In fractional odds, a top-heavy fraction like 10/1 indicates an 'odds against' bet with a low probability of occurring. Conversely, a bottom-heavy fraction like 1/2 represents an 'odds on' bet with a high probability of occurring.

Calculating your potential winnings is straightforward in fractional odds; you simply use the numbers within the fraction. The first number indicates the profit you would make by staking the second number.

For example:

At odds of 1/2, a ₹1 stake = ₹0.50 profit + ₹1 stake = ₹1.50 returned

At odds of 5/2, a ₹2 stake = ₹5 profit + ₹2 stake = ₹7 returned

At odds of 10/1, a ₹1 stake = ₹10 in profit + ₹1 stake = ₹11 returned

Calculating winnings with decimal odds is simple too; you multiply the odds by your stake to determine your potential winnings.

For example:

At odds of 1.50, a ₹1 stake = ₹1.50 returned (1.5 x 1)

At odds of 2.50, a ₹2 stake = ₹5.00 returned (2.5 x 2)

At odds of 11.00, a ₹1 stake = ₹11 returned (11 x 1)

What is Vigorish?

If you are entering the world of sports betting you need to know what vigorish is. Vigorish, ‘juice’, or 'vig' is like the casino's cut for the service it offers. Vig is the amount the sportsbook charges for taking your bet. You cannot always read odds and figure out the vig amount, it varies from wager to wager and sport to sport. 

In sports betting, a coin toss reflects the concepts of odds. The 50-50 chance of heads or tails may suggest that you will get even money returns. For example, your bet of ₹1,000 on tails would get you ₹2,000 (₹1,000 bet and ₹1,000 profit) if it lands on tails. 

However, for point-spread wagers, sportsbooks offer -110 odds. It means that you have to bet ₹1,100 to win ₹1,000. 

If the odds were, even your bet of ₹1,100 would pay out ₹1,100. However, at -110 odds, your bet brings ₹1,000, totalling ₹2,100. For example, a ₹10,000 bet at -110 odds would win ₹9,091. This difference of ₹909 between the bet and the payout is the vig that ensures sportsbook profitability. 

What are Some of the Most Common Sports Betting Odds? 

As you gain experience in sports betting, you will become familiar with common odds, point spreads, and money lines. Here are some examples of what you can expect to see most of the time (and what it means): 

a +7 Spread

If a team has a +7 point spread, it is a 7-point underdog. Betting on a 7-point underdog means you need the team to win outright or be defeated by 6 points or less. If the team ties, or loses by exactly 7 points, it results in a push. Then you can get your wager amount back.

a +4.5 Spread

You can consider a team with a +4.5-point spread, a 4.5-point underdog. The half-point ensures there will not be a tie or push. If a 4.5-point underdog wins the game or loses by a margin of four points or less, it has successfully covered the spread. However, if the underdog loses by five or more points, it does not cover the spread. The inclusion of a half-point in the point spread guarantees a clear winner, eliminating the possibility of a tie.

A +125 Odds

You can consider a team with odds of +125, a small or short underdog. If you bet ₹1000, these odds would gain you a profit of ₹1250.

A +350 Odds

These odds suggest that a bet is a pronounced long shot, with a 22% implied probability of a victory. In the event of an underdog upsetting the odds and you have placed a ₹1000 bet on them, your profit would amount to ₹3500, on top of your initial ₹1000 wager.

A 20-to-1

Odds of 20-to-1 indicate a long shot with a low likelihood of winning. For a team at 20-to-1 odds, the implied win probability is 4.76%. If such an underdog were to win, it would pay ₹20 in return for every ₹1 wagered. 

For instance, a ₹1000 bet on a 20-to-1 underdog would bring a substantial profit of ₹20,000, although such outcomes are rare. 

With these important concepts related to odds in sports betting, you can start to get a clearer understanding of what odds are and what they mean in sports betting. 

This understanding of implied probabilities will help you assess the risk and reward of your bets positively influencing your betting strategies and potential winnings.