What are Decimal Odds?
The odds on a bet represent the bookie’s calculation of how likely it is that the outcome being bet will actually happen, altered to take account of the number of people betting on a specific outcome. By studying the odds, a bettor can calculate how much they will receive as a pay-out if they bet a specific amount. Odds can be displayed in two different formats – as fractions (i.e.4/1) or as decimals (i.e. 5.00).
How are Decimal Odds used in Sports Betting?
The first thing to note before considering the use of decimal odds in sports betting is that they don’t translate directly into fraction odds. 10.00 in decimals isn’t 10/1 in fractions, and most online bookmakers will allow individual users to set the format in which they see their own bets. It’s useful to learn how both systems work, however, since either might be prepared in different parts of the world.
Using decimal odds is actually extremely simple, since the pay-out for an individual bet always equals the stake multiplied by the odds, with the original stake included in the final amount. An example would be a stake of £100 placed on Manchester City to win at odds of 2.64. If the bet is successful then the pay-out will be £264, which is 100 multiplied by 2.64. It should be noted that this includes the original stake, as do all pay-outs based on decimal odds, so the profit in this case was £164.
What anyone who has been more used to fraction odds has to understand is that any decimal odds of less than 2.00 are the equivalent of even money odds. This means that the profit on any money won back will be less than the original stake, albeit on a bet which is, as far as the bookmakers are concerned, more likely to result in a pay-out. An example of a less than even money win would be a horse which wins a race at decimal odds of 1.36. A bet of £10 would result if a pay-out of just £13.60, and a profit of £3.60. Forgetting that the stake is always included in the pay-out may lead bettors less experienced in decimal odds to mistakenly think that they are winning more than is actually the case.