An artist is only as good as the materials they use. A tatty old brush and cheap, watery paints are hardly going to produce a work of Sistine Chapel quality, after all.
The same can be said for punters and their appreciation of betting odds. If you don’t know how they work, how they are calculated or how you can use them to decide whether a bet is good ‘value’ or not, you simply won’t make as many profitable wagers as you would with an understanding of all of the above.
Hopefully, this guide will provide some useful pointers.
So you’ve got your online betting account set up and you are ready to place your bet, but what are all of these numbers next to the names of your favourite football teams and your fancies for that day’s horse racing? Those are the odds; your key accomplice in ‘bashing the bookies’.
What are Betting Odds?
In short, the odds supplied by a bookmaker hint at the likely outcome of a particular scenario occurring.
Depending on where you are based and who your online betting account is with, these will be displayed in different ways: in the UK, fractions are typically used while in Europe the same odds are depicted as decimals. ‘American’ odds, used in, erm, America, are displayed as + and – figures.
Even though displayed differently, the general theme is always the same: the lower the number, the more chance there is of an event occurring.
Take the English Premier League title race, for instance. At the start of the football season, the best betting sites will price up each team’s chances of lifting the trophy. Clearly, some sides are more fancied than others, which is why Manchester City might be a strong favourite and outfits like Bournemouth and Watford are considered lengthy outsiders.
Most of the best betting sites in the UK display their odds as fractions. The starting point is ‘even money’, which would be 1/1 in fractional terms but is usually just displayed as ‘Evs’ or similar.
From here, selections are considered ‘odds on’ or ‘odds against’. An odds-on wager is one where the outcome is considered likely to occur, and these prices range from a fraction short of even money, e.g. 5/6 or 10/11, right through to red hot favourites at 1/10 or 2/11 etc.
For now, don’t get too bogged down by the actual numbers, and just remember one guiding principle: in theory at least, accounting for the wonderful unpredictability of sport in general, an odds-on chance has a higher likelihood of occurring than an odds-against selection.
Decimal odds are typically used by European-focused bookies, ad again the process is exactly the same as that of fractional odds.
Even money is depicted as 2.00, and so numbers below this are odds-on chances and those higher than two are odds-against.
If you are ‘fractionally minded’ you can easily work out how decimal odds can be translated into fractions; 2.00 is 1/1, 1.50 is 1/2, 4.00 is 3/1 and so forth.
Again, the lower the number, the higher the chance of a selection being successful; taking into account the volatility of sport, of course.
The Americans do things slightly differently, although the process is essentially the same. These indicate an expected return based on a level figure; in fractional odds this is even money, in decimals it is 2.00 and in American odds it is +100. This tells us that we win $100 on top of our stake being returned if we bet $100.
The calculation is slightly different, however. American odds uses – and + figures to calculate likelihood of success based upon that +100 marker. So, if a selection is -125, then you will need to bet $125 in order to make a clear $100 profit.
For + figures, the amount you win is based on a $100 wager. So, if you bet on a +125 chance then you will win $125 from a $100 stake.
As you can see, the general principle behind each type of betting odds is the same, it’s just that the actual values look different.
But the golden rule of betting remains the same whether your online betting account is with a firm in the UK, Europe, America or Timbuktu: spotting the ‘value’, i.e. a selection that the bookmakers have priced up ‘wrongly’, in your opinion, is the key to long-term betting success.
How Do the Bookmakers Set Their Odds?
We could all price up a betting market. Say we were asked to set the odds for the Premier League title, we would know that Manchester City have a better chance than Bournemouth and would set our odds accordingly.
But the actual specifics are far more precise than that, and for one simple reason: the bookies have to make a profit!
The best betting sites offer punters odds that are competitive, i.e. they are a fair reflection of the likelihood of an event occurring.
But even these factor in something called the ‘over-round’, or ‘juice’ or ‘vig’ as they are known colloquially. This, is essence, is the bookmakers’ profit margin, and a buffer should they experience a high number of winning bets.
Take a big horse race, for instance, let’s say the Gold Cup. The betting market moves in line with the amount of money wagered, so by the time the horses come under starters orders the bookmakers’ favourite will be the one with the most money bet upon it. Should it win, it’s a dark day for the bookies!
But it’s not catastrophic, due to the over-round that has been built in.
Imagine a betting market where both Team A and Team B are priced at 7/4, with the draw at 13/5. If you do the necessary maths, you’ll note that in percentage terms, i.e. that chance of any of three outcomes occurring, it equals 100%. That would mean that no matter or who won (or if the match ended in a draw), the bookmakers wouldn’t make any money.
And so, the odds offered are lower than that. In the above example, Teams A and B could be priced at 6/4 and the draw at 12/5, and the percentage values would equal 109%; in the long run, that equates to a 9% profit margin.
As the old saying goes, you will never meet a poor bookmaker! Your job is to simply accumulate profit by betting smart, picking the events where the odds are fair and justified.