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How Do Betting Odds Work

What are American Odds?

American Odds are the standard format for sports betting odds in the United States – catering to American sports bettors. These odds are extremely easy to understand and are most commonly recalled or remembered as moneyline betting odds. While American odds are just one way to display your odds, many sportsbooks will offer decimal odds and fractional odds that can be toggled based on your personal preference.

Looking once again at moneyline betting types, American odds can show you how much money you would win on a wager based on which side of the wager you plan to bet on. Each game will have a favorite and an underdog: the negative number will represent the favored team, and the plus sign will indicate the underdog. The higher the value of the number of the American odds, the more you have to bet on a favorite, or the more you’d win by betting on an underdog.

If you have odds that look like this:

Golden State Warriors (-265)
Cleveland Cavaliers (+225)

The Golden State Warriors are the favored team because they have the negative odds. This means, that a moneyline bet on the Warriors with American odds would require you to bet $265 to win $100 (you would get your initial $265 returned as well).

The Cleveland Cavaliers are the underdog team in this situation, and a $100 wager would pay out $225 plus your initial stake of $100 is returned if you decided to place a risky wager on them. Betting on underdogs is always enticing with the bigger payout, but sometimes isn’t the smartest betting move unless you really do your research.

When looking at American odds, a common number you will keep seeing pop up will be -110. This is the amount that is standard in American odds across every sportsbook.

American odds on either side of the wager can go up into the tens of thousands for a really big underdog (+30,000) with absolutely no chance of winning, or a heavy favorite in the case of a (-15,000).

Converting your American Odds to Decimal

Since many of the calculations you would do to figure out how profitable your bet might be, such as implied probability, don’t cater to American odds, you will need to know how to convert your American odds to decimal.

It’s quite simple and once you get the hang of it, you can do it on the fly or in your head.

For positive American odds, such as those you’d see for an underdog team, let’s say +300, the formula is:
1 + (odds/100)
1+(300/100) = 4.0

For negative American odds, such as those you’d see for a favored team, let’s say -150, the formula is:
1-(100/150) = 0.33

Now that you have a decimal number, you can determine how much you would win on your wager if you weren’t always betting denominations of $100.

You simply multiply your decimal odds by your stake to get your winnings.
4.0 x $10 = $40
0.3 x $10 = $3

These are just simple calculations that will help you quickly be able to determine how much you’d win if you weren’t betting the amounts of the moneyline odds, or betting $100 at a time, as not many beginners or even intermediate bettors do.

What are Decimal Odds?

Decimal odds or European odds as they are sometimes referred to as, due to their prominence in the European countries. When looking at a particular sports event or match, you would They are easy to understand as they represent how much money one would win for every dollar wagered.

If you look at 4.0 odds, for every dollar you bet, you would win three, because your $1 wager is included in the $4 winnings. If you place a wager of $10 on 9.0 odds, you would have $80 in winnings.

In terms of calculating what your potential return would be using decimal odds, you would multiply the stake by the decimal odds number.

If you have an NBA game you want to look at betting on, and you have the following odds:

Houston Rockets 4.0
Denver Nuggets 1.28

The Houston Rockets are the underdog in this situation, as 4.0 is the higher number, and the higher the number, the bigger the underdog. The Denver Nuggets are the favored team, and it is less risky to bet on – but 1.28 decimal odds isn’t going to be a very profitable wager.

Let’s say your max bet amount is $25:

To calculate your potential winnings using decimal odds, we will use the formula mentioned above:

Betting on the Houston Rockets

(Decimal odds x the stake) – the stake
(4.0 x $25) – $25 = $75
You’d receive $100 in your sportsbook account by placing this wager.

Betting on the Denver Nuggets

(1.28 x $25) – $25 = $7
You’d receive $32 back into your sportsbook account by placing this wager.

Now, it’s great to see how much you could potentially win, that could be enough to sway you, but many sports bettors like to calculate the implied probability of their decimal odds. Implied probability is how likely it would be to win your bet.

To calculate implied probability, you would divide 1 by the decimal odds.

So, in the above example:

The odds of winning the Houston bet at 4.0 odds:

1 divided by 4.0 = 25% odds that the Houston Rockets would win the game.
1 divided by 1.28 = 78.1% odds that the Denver Nuggets would win the game.
Now that you know the probability of winning your bets, you can start betting on decimal odds on our sportsbook.

What are Fractional Odds?

There are three major odds formats that you will see on any sportsbook, not just our BetUS sportsbook. In addition to Decimal odds and American odds, there are Fractional odds. Fractional odds are popular in the United Kingdom and are considered to be more traditional as they’ve been around the longest.

They are typically displayed as a fraction with a forward-facing slash or a hyphen and can be easier to understand for some – as you could grasp four to one (4/1) odds easier than American odds of +400 or decimal odds of 5.0.

When you look at 4/1 odds, for every $1 you wager, you would win $4. You also get your initial $1 back in addition to your winnings.

Calculating your payout can be a little more complicated than calculating decimal odds. The formula looks like this:

Payout = Stake x (Numerator/Denominator) + Stake

The numerator is the top number and the denominator is the bottom number of your fraction.

Let’s take a look at a real-life example for an NHL game between the Vegas Golden Knights and the Anaheim Ducks:

Vegas Golden Knights 2/5
Anaheim Ducks 41/20

In this situation, Vegas is favored to win the game, and Anaheim are the underdogs. For this example, let’s say we have $30 budgeted to wager on this game.

If we were to bet on the Vegas Golden Knights, we would have a formula that looks like this:

$30 x (2/5) +$30 = $42
A bet on the Vegas Golden Knights would pay out $42 as they are favored and there isn’t a huge risk in betting on them.

If you were to bet on the Anaheim Ducks, we would have a formula that looks like this:

$30 x (41/20) + $30 = $91.50
A bet on the Anaheim Ducks would pay out $91.50 as they are the underdog, and a bet on them would be much riskier as they have a lower chance of winning the game.

Now, as we mentioned the likelihood of each team winning the game, we can also calculate the implied probability of each side of the wager to determine how probable it is for your wager to cash.

The calculation looks something like this: Denominator/(Numerator/Denominator) = %

If we were looking to bet on the Vegas Golden Knights at 2/5 odds, you would calculate the probability of winning by using this formula:

5/(2+5) = 71.4%

The Vegas Golden Knights have a 71.4% chance of winning the game which is fairly high and explains the minimal risk associated with the fractional odds.

20/(41+20) = 32.7%

The Anaheim Ducks have a 32% chance of winning the game which is still quite high and could provide some decent value if they do pull off a victory.

Now that you have an idea of what fractional odds are and how fractional odds work, you can head over to the sportsbook and start betting on fractional odds now.

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