The rise of legal sports betting in North America has led to thousands of Americans and Canadians wanting to place their first bets. If you’re one of those people, this article will help you get over one of the major hurdles you need to clear before you can become an educated sports bettor. That hurdle is understanding sports betting odds. Specifically, in this article we’ll tell you how to understand decimal format betting odds.
The decimal odds format is primarily used at European sportsbooks, but that doesn’t mean you won’t see decimal odds at legal sports betting sites in Canada and the US. The decimal betting odds format is the simplest odds format, so it’s popular all around the world. This is why it’s important to understand decimal odds before diving headfirst into sports betting. Many sports bettors in North America will switch the default on their online sportsbook to be decimal format.
To understand the decimal odds format, all you really need to understand is basic multiplication. Decimal odds represent how much money you would win from a $1 bet, including your original bet. So if you wager $10 on a bet with 2.25 odds, you could win $22.50.
This simplicity is why the decimal odds format is so popular in sports betting circles. With that being said, there’s still a lot you can learn about decimal odds and sports betting odds in general, so let’s get into it.
Why are odds used in sports betting?
Before we get into decimal odds specifically, let’s take a look at why odds are used in sports betting.
Simply put, sports betting odds are how sportsbooks represent the chances of a certain bet hitting. In other words, odds represent probabilities. Any one bet can have millions of individual factors contributing to whether it will be a winner or a loser. Sports betting odds boil those millions of factors down to one simple number for you to bet on.
It sounds complicated, but it’s really very simple. Let’s say famous boxer Canelo Álvarez was going to fight some random Joe off the street in an official boxing match. Unless the random Joe is secretly Oleksandr Usyk in disguise, Canelo will win this fight. What are the exact chances of Canelo winning though? That’s where sports betting odds come in. A sportsbook’s odds for this fight turn Canelo from being an abstract favorite to win the fight into something you can bet on with some mathematical certainty.
In more even contests, betting odds can actually help shape narratives and be used to determine how sports fans feel about a certain contest or sporting event. A recent case from the 2023 NBA Draft shows this perfectly. A simple tweet from NBA reporter Shams Charania turned the NBA Draft betting market upside down. Shams tweeted that the Charlotte Hornets were torn about whether to draft G-League prospect Scoot Henderson or Alabama’s Brandon Miller. In the hours following Shams tweet, NBA Draft betting odds changed from Miller being a lock to join the Hornets to being a longshot. This was because of sports bettors flooding the market with bets on Henderson.
To summarize, sports betting odds reflect the chances of an event happening, but they also reflect general consensus, rapidly changing storylines, and how others are betting. By having odds, sports bettors can place wagers on both sides of any matchup even if there is a huge imbalance in the likelihood of each result. Understanding these factors is key to understanding sports betting odds and making smart bets.
Decimal betting odds explained – How to read decimal format betting odds
Whichever sportsbook you decide to go to, we can guarantee you’ll encounter an overwhelming list of numbers. Most sportsbooks use the American odds format but many also use the decimal format. You can recognize this odds format because of its simplicity. Odds will be listed as basic numbers followed by two decimal places (e.g., 1.25, 2.58, 3.15, etc.)
Decimal odds are based on $1 bets, so to figure out how much you would win from a bet, just multiply your bet times the decimal odds. It’s really that simple.
You should keep in mind though that decimal odds will tell you how much you would win, including your original bet. For example, a $10 wager on 2.25 odds gets you $22.50 back, but not $22.50 in profit. $10 on 2.25 odds gets you $12.50 in profit plus your original $10 wager back.
How to tell when a team is a favorite using decimal format betting odds
The decimal odds format is very simple, but it lacks the obvious markers of the American and fractional formats. This makes understanding when a team is a favorite a little complicated if you are unfamiliar with decimal odds. Thankfully though, favorites are easy to spot once you know the basic rule.
That basic rule is that odds between 1-2 are generally for favorites. This makes sense if you think about it. Decimal odds include your winnings, so if you bet on a team with odds less than 2.00, your net profit will be less than your original bet. This is the same as a team having negative odds in American format betting odds.
How to tell when a team is an underdog using decimal format betting odds
The flip side of the basic rule we just discussed for favorites is that odds greater than 2.00 are generally underdogs. Of course, it could be possible that both teams have odds greater than 2.00. This is actually really common in sports like soccer where draws are also a possibility.
In cases where both teams have odds higher than 2.00, the team with the lower odds are favorites and the team with higher odds are underdogs. For example, if Real Madrid had 2.25 odds to win against Manchester United who had 3.00 odds, Real Madrid would be the favorites.
What are the other types of popular ways to display betting odds?
While the decimal odds format is the simplest sports betting odds format to understand, it’s far off from being the most popular format in North America.
American format odds and fractional odds are also popular at sportsbooks in North America. Online betting sites will usually give you the choice to display odds in your preferred format.
American format betting odds
As you can probably guess from the name, American format betting odds is the default odds format in North America. If you’re going to be betting at physical sportsbooks in North America, you should probably at least know a little something about American odds.
American format odds are displayed as positive and negative numbers. Positive numbers refer to how much you can win from a $100 bet. Negative numbers indicate how much you need to wager to win $100. For example, a $100 bet with +250 odds will net $250 it you win. -250 odds means you need to bet $250 to win $100.
How to convert decimal odds into American odds
If you decide that decimal odds aren’t for you and would prefer to use American odds, there is a simple formula you can remember to quickly transform decimal odds into the American format.
- For decimal odds 2.00 or larger: (decimal odds – 1) x 100 = American odds.
- For decimal odds between 1.00-1.99: -100 / (decimal odds – 1) = American odds.
Let’s use 2.50 and 1.50 as examples.
- For 2.50: (2.50-1) x 100 = +150
- For 1.50: -100 / (1.50-1) = -200
Fractional betting odds
The third and final betting odds format you’re likely to see is fractional betting odds. This odds format is mostly used in the UK, but is also pretty common to see in the US. Horse racing tends to use fractional odds, for example.
Like decimal odds, fractional odds are attractive because you really just need to know how to do basic multiplication. With that being said, there is one key difference between fractional odds and decimal odds. Fractional odds do not include your original stake.
For example, if you bet $100 on Andy Murray 40/1 to win Wimbledon 2023, you could win $4,000 plus your original $100 bet. This means your total winnings would be $4,100.
How to convert decimal odds into fractional odds
Converting decimal odds into fractional odds is even simpler than converting decimal odds into American odds. All you need to do is subtract one from your decimal odds.
- Fractional odds = decimal odds – 1
For example, Andy Murray’s Wimbledon odds in decimal format would be 41.00. Subtracting one, gets you your fractional odds of 40/1.
How to convert decimal betting odds into probabilities
As useful as betting odds are for understanding your chances of winning, sometimes it is nice to have a simple percentage to look at. Converting betting odds into implied probabilities is the best way to do that.
You can convert any odds format into implied probabilities, but since this article is about decimal odds, here is how you turn decimal odds into implied probabilities:
- Implied probability = (1/decimal odds) x 100%
Let’s again use Wimbledon 2023, but go with the favorite this time. Novak Djokovic is currently the favorite to win Wimbledon with 1.72 odds. If we put that in our formula, you can see that turns into an implied probability of 58.14%.
- Implied probability = (1/1.72) x 100%
- Implied probability = (1/1.72) x 100%
- Implied probability = (0.5814) x 100%
- Implied probability = 58.14%
What is vigorish and why does it matter?
The last major concept you should know about before you start betting on sports is vigorish, which you’ll often hear called “the vig” or “juice” by experienced sports bettors.
Vigorish is sports betting parlance for the house edge. Basically, the price that you are paying to place the bet and how the sportsbook makes their money. Vigorish gets put into every line, so you can’t avoid it. Vigorish is included in all bets, so you can’t avoid it.
For example, if you are betting on the over/under in a baseball game, the over and the under will normally have the same odds. This means that whether you bet on the over or the under, both have the same chance of hitting, according to the odds. However, this isn’t really the case. If we use 1.90 odds as our example, you’re actually only getting $10 back for every $11 you gamble. That extra $1 is the vigorish and what the sportsbook keeps for performing its task.
To make this point even more clear, imagine we cloned Canelo Álvarez to fight himself. If we did this, there would be nothing to separate the two Canelos. Each one should have the exact same chance of winning the fight. However, the odds would not reflect this because of the vigorish.
Even in a scenario with equal odds, a sportsbook will set odds somewhere around 1.90. In practice, this means that if 10 people bet on each side, the sportsbooks could use the losing bets to pay out the winners and still have $1 per person left over to keep as a profit.
Vigorish is something you should always consider when you’re making your bets, especially when you look at something like implied probabilities. It’s right there in the name. Implied probabilities are not true probabilities. They are simply the probabilities you get from converting betting odds. These odds are affected by the vig, other bettors, and many other factors.
Decimal betting odds FAQ
Reading decimal betting odds is as simple as multiplying your bet times the odds listed. This equation will tell you the total amount you can win, including your original stake, if your bet is a successful one.
In North America, the most common betting odds format is the American format. Fractional odds and decimal odds are also common, especially at online sportsbooks.
Yes. Understanding sports betting odds means understanding how much your wager could get you in return. Because odds can also be read as probabilities, they also help you understand whether the bet you’re making is a smart one.
