Betting Odds Explained

Betting Odds Beginners Guide

Before engaging in a bet, whether it is casino gambling, virtual football games, or live games played in any league or tournament, it is inherent that a gambler understands betting odds. Therefore, intelligent betting calls for an understanding of betting odds, including the main types of betting odds.  This includes the ability to not only read but also assess and interpret their related formats. Specifically, betting odds are the measure in betting, that provides the likelihood of a game’s outcome. The odds are calculated as the number of events’ ratio providing the outcome to the number that does not offer an anticipated result. 

What is probability?

Betting odds are used when deciding the likelihood of an event’s outcome. They are the probability metric that guides gamblers on where to place their bets according to how the bookies have identified the probability. Simply put- probability is the likelihood of an occurrence. When the bookmaker has identified a sporting event to have a higher probability, the outcome is likelier to happen than not. On the other hand, if the event is 

Probability is a popular approach to betting in many countries, including Kenya. The most common explanation of probability is a coin toss, where the possibility of an outcome is identified by either heads or tails. The probability in which a coin toss would result in a heads or tails is one in two chances. With this concept, the punters represent this likelihood as 1/1, to show that both outcomes are equally possible. 

Types of betting odds

The three common types of betting odds include the fractional odds, also known as the British odds, the decimal odds, also known as the European odds, and the money line odds, also known as the American odds. It is important to note that these betting odds represent the same thing, meaning that the outcome is similar, however, the disparity is in their representation and structure. Nonetheless, the payout is the same.

Decimal Betting Odds

The decimal odds are a popular approach by sports bettors in Canada, Australia, and Europe. They are easy to understand and calculate, and this factor makes them a popular choice for a majority of bookies globally, Kenya included. 

The decimal odds are created by dividing the fraction odds and adding one. The bookies convert a fraction into a decimal odd by dividing the numerator and the denominator. The numerator is the first number, whereas the denominator is the second number. 

The equation is: (numerator/denominator) + 1.

Example 1

Take 2/1 as a fractional odd. 

The decimal odd will be represented as 

2/1 = 2

2+1 = 3 

The decimal odd will be 3.0 

Example 2

Take 3/4 as a fractional odd.

The decimal odd will be represented as 

3/4 = 0.75

0.75 + 1 = 1.75 

The decimal odd will be 1.75

Further interpretation

Decimal odds are the easiest way of calculating winnings when a bet is placed. The formula used to calculate the winnings in this form of betting is multiplying the total stake with the total odds. 

For instance, a bettor places Kshs 200 on Arsenal to win against Nottingham Forest, and Arsenal has the odds of 1.45. this means that the bettor is risking Kshs 200 to win Kshs 290. The potential net profit is Kshs 90, from the Kshs 200 stake. 

When bookies use decimal odds, a bettor’s original stake is the one used to calculate their potential winnings. When an individual wants to determine their net profit, they subtract the stake from their winnings to get their profit. 

In addition, 2.0 is the breakeven odds for the decimal odds because this shows that the odds double a bettor’s stake. Gamblers should therefore understand that odds below 2.0 result in a less net profit than the stake. On the other hand, odds of higher than 2.0 result in a net profit exceeding the total stake. 

Multibets

Multibets, also known as Parlays, are the most popular betting approach used by bettors because they result in higher net profits. Parlays are multi bets where the bookies calculate the odds based on the number of bets placed by a bettor. Traditional parlays involve calculating bets based on a number of teams, however, since betting has been diversified and the number of choices to place bets increased, parlays are more of a multi-accumulator of the decimal odds to ensure that the gambler gets the highest possible returns, based on their selected odds. Today, maximizing odds on a parlay involves multiplying the decimal odds to get the maximized edge that can be multiplied with the bettor’s stake. It is normally termed as the most accurate approach for establishing potential winnings, which has made decimal odds a popular approach. 

For instance, a bettor has selected 8 teams with the odds, of 1.27, 1.65, 3.45, 2.34, 1.20, 4.78, 2.09, and 1.53. a parlay would be calculated by multiplying all the odds to get a maximized odd based on all the bets placed. Multiplication provides the most accurate accumulated odds for the bettor. In this instance, it would be 

1.27 x 1.65 x 3.45 x 2.34 x 1.20 x 4.78 x 2.09 x 1.53 = 310.29

The possible winnings will therefore be calculated by multiplying the accumulated odds of all the bets placed, 310.29, by the stake.

For instance, if the stake is Kshs 100, the potential winnings would be 

310.9 x 100

= Kshs 31,090

Fractional Betting Odds

Betting odds are presented by two numbers separated by a forward slash, meaning that bookies can use this technique to calculate the probability of a sporting event’s outcome. 

Under the fractional system, the two numbers appearing in the odds provided by bookies is the simplest way of explaining the calculation of probability. To demonstrate this, the numbers can be replaced by letters for easier understanding. An odd of 4/3 can be represented as X/Y, meaning that the calculation of the probability (%) = Y/(X+Y). 

The subsequent list provides samples of betting odds being converted into percentages to identify their probability. When calculating the possible payout, the odds are 8/1, meaning that in the British system, placing a £1 bet puts the gambler in a position of winning £8 more. For every £1 bet, there is a chance of winning £8. 

Now let’s flip this scenario into the Kenyan currency, the explanation remains the same, and the payout also remains the same, depending on the amount of money placed. Particularly, when an individual places a Kshs 1 bet, they stand a chance of winning an extra Kshs 8. For every Kshs 1 bet placed, the gambler stands a chance of winning Kshs 8. 

Example 1

5/2 can be calculated as

= Y/(X + Y)

= 2/(5+ 2)

= 2/7

= 0.28 – there is a 28% chance that the result will occur. 

In this scenario, for every £2 bet placed, the gambler stands a chance of winning £2. 

In terms of the Kenya shilling, the odds posit that for every Kshs 2 bet placed, the gambler stands a chance of winning Kshs 5. 

Example 2

1/2 can be calculated as

= Y/(X + Y)

= 2/(1 + 2)

= 2/3

= 0.67 – there is a 67% chance that this result will occur. 

In this case, the bookies posit that with every £2 placed, the gambler stands a chance of winning £1. Similarly, a Kenyan gambler would win Kshs 1 for every Kshs 2 bet placed. 

Further interpretation 

The interpretation is that the percentages show the probability of the chances of winning. When the chances of winning are higher, the returns are relatively less. 

American Betting Odds

The American odds revolve around placing a wager or winning a sum of money, mostly $100. The wager is not limited to $100, as it can be scaled higher or lower, depending on the gambler’s preference, or the conditions set by the betting entity. 

When betting for a favorite team or choice or item, the odds for the favorite exhibit a minus sign (-) preceding the odds and showcases the amount of money an individual needs to risk winning $100. 

Assuming an individual fancies a win for the Chicago Bulls, and the Chicago Bulls have an odds of -130, the bettor would need to risk $130 to win $100 and get their $130 back. 

When betting for a team less likely to win, also known as the underdog in sports, the team will have a positive sign (+) preceding the odds. 

For instance, the team playing against the Chicago Bulls is the Miami Heats, and the odds for the Miami Heats are + 120, this means that with a bet of $100, the bettor is likely to win $120 and retain their $100 stake. 

Consequently, for every $1.30 risked in the Chicago Bulls game, the bettor stands a chance of making a $1 profit. Contrarily, for every $1 risked on the Miami Heats, the Bettor stands a chance of winning a net profit of $1.20. 

The point spread (over/under)

Another way in which the American odds are used is through the margin of victory in a sporting event. This approach is popular in football and basketball. Under this domain, a bettor risks by how much, rather than what needs to happen as the end result. 

For instance, giving Penn State a +6.5 means that for the bettor to win the bet, Pen State should win by at least 7 points, as the bet dictates that the margin should exceed 6.5 points. 

Calculating the amount of money a person wants to win is different using the American odds, as compared with the fractional and the decimal odds approach. 

Example 1

Assuming that a bettor wants to win $30 by placing a bet on the Chicago Bulls. The odds are – 130, meaning that the Chicago Bulls are the favorites, and the player has to risk more than $30 to win a net profit of $30. The formula for winning $30 will be 

The win amount x ((-1 x Moneyline)/100)

= $30 x (130/100)

= $30 x 1.3

= $39 

The bettor will have to place a bet of $39 to win a net profit of $30. 

Example 2

Assuming that a bettor wages $30 for a win for the Chicago Bulls. The odds are – 130 for a win for the Bulls, meaning that they are favorites. The player will therefore win a net profit of less than $30, which is the stake. The formula for winning will be 

The wager amount x ((100/Moneyline x -1))

= $30 x (100/130)

= $30 x 10/13

= $23.08 

The bettor will obtain a net profit of $23.08 from the bet. 

Calculating Implied Probability

Football betting is the most popular form of gambling in Kenya. It involves selecting outcomes that people deem likely to happen and placing their bets on them. Football has several outcomes to be predicted, such as the score line, the number of goals to be scored, the specific scorer, double chance, the number of yellow and red cards, the number of corners conceded, top scorers, likely tournament winners, and the least likely winners among many other options. 

A majority of bettors in football betting prefer placing the multi bet, therefore, parlays are a popular aspect of football betting in Kenya. Since decimal odds are a popular approach locally, parlays are a popular choice for football betting. 

The 1X2 margin

The 1X2 margin represents three outcomes in sports betting, whereby 1 represents the home team, 2 represents the away team and X represents a draw. Under this, bookmakers convert the odds of the possible outcomes into a decimal probability. 

The margin is therefore calculated as:  

(1/home odds) + (1/away odds) + (1/draw odds) – 1

Assuming Gor Mahia is playing against Kariobangi Sharks. Gor Mahia has a Decimal odd of 3.41 whereas Kariobangi Sharks has an odd of 2.39. the bookmakers thereafter allocate 3.19 as the odd for a draw. 

The margin will therefore be (1/3.41) + (1/2.39) + (1/3.19) – 1. 

= (0.293 + 0.418 + 0.313) – 1

= 0.024 

The margin is essential for gamblers to identify the best bookmakers and increase their net profit for the money they stake. 

Differing odds 

In football betting, odds differ depending on the likelihood of an outcome. For instance, Arsenal playing against Manchester City will have its odds fancying a win for Manchester City than Arsenal. This means that Manchester City will have lower odds because of their higher probability of winning.

On the other hand, this aspect applies when betting on other domains such as corners, bookings, and send-offs. A football game is bound to have various corners; therefore, this domain will call for a bettor to place a bet based on the number of corners. The bookmakers will therefore determine the odds based on the attacking style or general style of play of the teams. Teams that are highly attacking will likely have more corners, therefore, with a higher probability for a higher number of corners, the odds are likely to be lower. 

The double chance 

The double chance is one of the most popular selections in football betting where bookmakers give punters the option to pick two options for an outcome. For instance, a bettor can select a win or draw for Arsenal, playing against Chelsea. This means that should the match end in a win for arsenal, the player wins the bet, whereas when the match ends in a draw, the player also wins the bet. However, when the match ends in a win for Chelsea, the player loses the bet. Traditionally, double chance odds are low because of the increased probability of an outcome. 

The live bet 

The live bet is the bet placed when the game is in play. Under a live bet, the odds change as time moves. The teams with a higher score line have their odds reduced whereas the teams with a lower score line have their odds increasing this is because the chances of winning are flipped in favor of the leading team. There are other factors that determine odd changes during the live bet. These factors include red or yellow cards and injuries. These scenarios may play to the advantage or disadvantage of a team; therefore, bookies calculate the odds to suit their perceived higher or lower probability.