Essential Information on Betting Odds
Odds are numbers which express the chances against the event which you have chosen to wager on. In other words, odds will show you what the likelihood of the outcome is. The outcome is comprised of the wagers staked by the parties, the bookmaker and the gambler. For example, if you see the odds 6 to 1, the bookmaker stakes 6 times as much as the gambler.
Odds in betting will tell you the likelihood of the sports event outcome, and how much you are likely to win by making your wager.
Why bookmakers are called in this way
In the past, the wagers themselves and the profits made in wagering were entered in a ledger, hence the name “book”, and the term “bookmaker”.
Odds in multi-level situations, like sports events
In everyday situations, you can also have some kinds of odds, for example when you wager against someone by tossing a coin. In such wagering, you and the other person offer level stakes. But in sports gambling, when you bet on situations which have more variables, like horse racing, the odds will show you what the perspective of the possible outcomes is.
What odds represent in sports gambling
The odds are the amount that you will get from the bookmaker on a winning bet, with the stake added. As mentioned above, when the odds are 6 to 1, for instance in horse racing, it means that you will wager £1, and if the horse wins, you will be paid £6 plus the stake. If the horse loses, you will lose your stake: the bookmaker will keep it. If there are three horses participating in the race, the 100% of the odds will be divided between the three.
Probability in odds explained in greater details
So it is down to getting the correct prediction, in order to win. For each of the sports events, there are a number of outcomes. The simplest idea that can help to understand that is the example of the dice. When you roll it, the outcomes that are possible are six. The chance of each of the outcomes is 100% divided by 6. That makes 16.67% for each of the outcomes. In the United Kingdom, bookmakers represent odds as fractions. For odds of 6 to 1, the fraction is 6/1. For odds of 4 to 1, or 4/1, there is a 20% chance. There are also odds represented in decimals.
How odds can help you to figure out the money you can win by wagering
There is a simple way to figure out how much you can win by placing your stake. For example, for odds of 6/1, for each £1 you wager, you can win £6. When the odds are 1/6, for each £6 you wager, you will win £1. Add to this the return of your wager amount.
When odds are expressed in decimals, which is the case on online bookmakers like Betfair, the figuring out of your possible wins will be even easier. When the odds are 6.0, that will mean 6.0 times your stake, and from that amount you must deduce the stake. The general formula you can use is: Your wins = (odds times your stake) minus your stake amount.
Decimal odds are becoming more frequent
You will notice that decimal odds are becoming more frequent on online bookmaking sites. This is due to the fact that they are a more common and more easily understandable way of representing the odds. But there are two more important differences in favour of decimal odds.
Whereas fractions represent odds without the returned stake, decimally represented odds show the stake as well.
A third difference in favour of decimal odds compared to fractions is that when odds change a little, large fractions must be used to reflect the change of the probability, its increase or decrease, and these large fractions are more difficult for punters to work out.
For your information, American odds are used on sportsbooks in the US. Another name for these is Moneyline Odds. With them, the idea is to show you the amount you must wager to win $100. The odds with a minus show that these are odds on likely winners, and the odds with a plus show they are on a likely loser.
One example of representation of American odds is -110: it means that to win $100, the wager you must place should be $110. To your win you will get your wager back, too. This means that your possible payout in the case of a win of the team you have wagered on is $100, your win, plus your original wager, $110, or the total can be $210.
When you bet on an underdog, which means a team that is likely to lose, you will wager $100 at a high risk. The odds on such events can be high, of the order of +240, so it means that with the $100 wagered you will have a chance of winning $240. In the event that you win, you will get your win, $240, plus the original wager, $100, that is, the total payout can be $340.
Online calculators for conversion of odds into the different formats
You will be helped in the figuring out of the odds and of your likely profits by the online calculators available. There are online odds calculators where you can enter the odds in any of the three formats, fractional, decimal, or American style odds. You can use the calculators to convert the odds from one format into another. Then all you need to do is click the button to get the conversion carried out. You will see the converted odds, plus the expected profit for you. Don't forget to add the amount of your wager to the likely profit shown, to get an idea of your total possible win.
Taxes on wins which are imposed in compliance with jurisdiction
Depending on the relevant jurisdiction, there can be taxes on wins that the bookmaker or you have achieved. If you have to pay a tax, that will reduce the amount of your wins.