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How to Read & Understand Betting Odds

Betting odds are the core of sports betting, determining both potential payouts and the likelihood of specific outcomes. To place informed bets, you need to understand how these odds are presented and how to read them correctly.

There are three main types of odds used across different regions and sportsbooks:

• American Odds (Moneyline) – Standard in the United States.
• Decimal Odds (European) – Common in Europe, Canada, and Australia.
• Fractional Odds (British) – Popular in the UK and horse racing markets.

Each format displays the same underlying probabilities and payouts differently, so knowing how to interpret them ensures you can compare odds effectively. This page breaks down how each odds type works, how to read them, and what they mean for your bets.

American Odds (Moneyline) Explained

American odds, also known as Moneyline odds, are the most common odds format in the United States. They are expressed as either a positive (+) or negative (-) number and indicate how much you can win or need to bet. American odds are easier to interpret when dealing with favorites (more likely to win) and underdogs (less likely to win).

How To Read American Odds?

Reading American odds is straightforward once you understand the basic interpretation. Let’s break it down with a real game example. Imagine the New York Yankees are playing the Boston Red Sox. According to sportsbooks, The Yankees are favorites, with odds of -130, while the Red Sox are underdogs with odds of +120:

Team	Odds
New York Yankees (Favorites)	-130
Boston Red Sox (Underdogs)	+120

Favorites (Negative Odds)

• A minus sign (-) indicates the favorite.
• The number following the minus sign shows how much you need to bet to win $100.
• Example: If you bet $130 and the Yankees win, you’ll get $100 in profit, plus your $130 back.

So, a $130 bet on Yankees at -130 odds wins $100 in profit, and the total payout (profit + original bet) is $230.

Underdogs (Positive Odds)

• A plus sign (+) indicates the underdog.
• The number following the plus sign shows how much you’ll win if you bet $100.
• Example: If you bet $100 and the Red Sox win, you’ll get $120 in profit, plus your $100 back.

So, a $100 bet on Red Sox at +120 odds wins $120 in profit, and the total payout (profit + original bet) is $220.

Decimal Odds (European) Explained

Decimal odds represent the total payout (including the original stake) for every $1 wagered. They are the most commonly used odds format in Europe, Canada, Australia, and New Zealand because they are straightforward to calculate. The higher the decimal number, the less likely the outcome is (higher risk, bigger potential payout). The lower the decimal number, the more likely the outcome is (lower risk, smaller payout).

How To Read Decimal Odds?

Decimal odds are easy to understand and calculate payouts, they are displayed as a single number, usually with two decimal places (e.g., 2.50). The number represents the total return, including your stake. To calculate the payout, simply multiply your stake by the decimal odds.

• Favorites have lower decimal odds (closer to 1.00)
• Underdogs have higher decimal odds

The total payout (including the original bet), is calculated based on:

Let’s say the Los Angeles Lakers are playing the Golden State Warriors, and the decimal odds for the game are:

Team	Odds
Los Angeles Lakers (Favorites)	1.80
Golden State Warriors (Underdogs)	2.20

Fractional Odds (British) Explained

Fractional odds, also known as UK odds or British odds, are one of the oldest and most widely used betting formats, especially in horse racing and UK sportsbooks. Understanding fractional odds helps bettors calculate payouts and implied probabilities before placing bets. Below, we’ll break down how fractional odds work and how to read them effectively.

How To Read Fractional Odds?

Fractional odds show how much profit you will make relative to your stake. They are written in a fraction format, such as 5/1 or 7/2. The first number (numerator) represents how much profit you will earn per unit wagered. The second number (denominator) represents how much you need to bet to earn that profit.

You can determine the favourite and the underdog by looking at the size of the fraction. Favourites have smaller fractions where numerator is smaller than the denominator (e.g., 1/2, 2/5). Underdogs have larger fractions where numerator is larger than the denominator (e.g., 5/1, 10/3).

Example of Fractional Odds Format:

• 5/1 (read as “five to one”) → You win $5 for every $1 bet.
• 7/2 (read as “seven to two”) → You win $7 for every $2 bet.

The total payout (including the original bet), is calculated based on:

Let’s break down the above formula with a real example so you can confidently calculate your potential returns before placing a bet.

Team	Odds
Brentford (Underdogs)	5/2
Tottenham Hotspur (Favorites)	1/2

Why Converting Odds Matters in Sports Betting?

Different sportsbooks and regions use different odds formats, but they all represent the same thing—the likelihood of an outcome and potential payouts. Converting odds between these formats allows for easier comparison across different betting markets.

For example, American odds of -200 are equivalent to 1/2 in fractional odds and 1.50 in decimal odds, all representing the same probability and payout. Larger positive American odds, like +300, convert to 3/1 in fractional odds and 4.00 in decimal odds, meaning a $100 bet returns $300 in profit.

The Role of Implied Probability in Betting Odds

Implied probability represents the chance of an outcome occurring based on the given betting odds. Understanding how to calculate implied probability helps bettors identify how likely a sportsbook believes an event is to happen and whether the odds offer potential value. The probability is “implied” because it’s derived from the odds rather than real-world factors like team performance or player statistics.

For example, odds of -200 (American), 1.50 (Decimal), or 1/2 (Fractional) suggest a 66.67% implied probability, meaning the bookmaker believes this outcome will happen roughly two-thirds of the time. Conversely, a big underdog with +300 (American), 4.00 (Decimal), or 3/1 (Fractional) carries a 25% implied probability, indicating a lower expected likelihood but a higher potential payout.

Ready To Choose Your Preferred Format?

Understanding different types of odds is essential for navigating the sports betting world. Whether you’re dealing with American, Decimal, or Fractional odds, knowing how to interpret them gives you a clearer picture of potential payouts. Beyond just reading odds, knowing how to convert between formats allows for better comparisons across sportsbooks, while understanding implied probability helps identify value bets.

With this knowledge, you can approach betting with more confidence, recognizing which odds formats suit you best and making smarter wagers based on probability and value.