What is Decimal odds
Decimal odds are representative numbers for the amount a person wins for every $1 wagered. These numbers represent the total return on a bet, instead of the profit. This means that the initial stake is included in the decimal number and does not require to be added back, making the total calculations relatively easier, as compared to other types of odds.
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Decimal odds reflect two things
- Price estimation, that is, how much money one wins if their bet wins.
- Probability, that is, the likelihood of the chosen bet to win.
- A decimal odd against price 6.0 with a stake of $1 returns $6 to the bettor.
- A decimal odd placed at evens like 2.0 with a stake of $5 returns $10
- A decimal odd on price 1.5 with a stake $5 returns $7.5
Converting Decimal Odds to Implied Probability
To assess the potential value in the market of betting, it is important to know the implied probability from the odds available. Implied probability is the method for converting betting odds into percentage, while keeping into account the margin for bookmaker for expressing the probability that is expected of an outcome occurring. If the obtained implied probability appears to be lesser than your assessment, then it is representative of the betting value.
Calculation of implied probability from the decimal odds is obtained through following formulation:
Implied Probability = (1/ Decimal Odds)*100
If the decimal odds available for a player A for a match are 6.50 then the probability for player A winning comes out to be:
(1/6.50)*100 = 15.3%
This means that Player A has 15.3% chance of winning.
Converting Fractional Odds to Decimal Odds
Fractional odds represent the ratio of the profit (amount won) to the stake. They are most common in the regions of Ireland and United Kingdom, and therefore are also called British, Traditional or UK odds. Represented in the form of a ratio or a fraction, the left side of fraction has the number representing the profit expected if the bettor stakes the number placed at the right side of the fraction.
Conversion of fractional odds into decimal odds is a very simple and easy procedure. It requires the fraction to be converted into decimal and then 1 added to it. This is achieved through following formulation:
Decimal Odds = (numerator of fractional odd / denominator of fractional odd) + 1
For a fractional odd of 4 to 5 i.e. 4/5, the decimal odds is obtained as
4/5: (4/5) + 1 = (0.8) + 1 = 1.8
Conversion of fractional odds to decimal odds is usually done owing to the easiness with handling of decimal odds.
Converting Decimal odds into Fractional Odds
The conversion of decimal odds into fractional odds can be achieved in two steps:
From the decimal odd to convert it into a fractional odd, using 1 as a denominator. For example, in case of a decimal odd 4.40, the first step would be as follows:
4.40 – 1 = 3.40 = 3.40/1
However, bookmakers tend to use fractional without any decimal number. This calls for step two.
To remove the decimal point from the obtained fraction, we need to convert the fraction into its simplest form, that is, finding the nearest whole integer to the fraction. The whole number is represented as the numerator of the final fraction, whereas, the factor required to multiply the initial fraction to obtain this whole number is represented as the denominator of the final fraction. For example, for 3.40 the nearest whole number is 17 which is obtained by multiplying 3.40 by 5, therefore, final fractional becomes 17/5.
Formula for converting decimal odd into fractional odd is:
Fractional odd = ((Decimal odd -1) / 1)
How To Use Decimal Odds To Make Money?
Matched betting is a good option to use the decimal odds for converting the bookmakers’ promotions and free bets into real money. You can find best matches (between both back and lay odds) using the decimal odds and extract real value. The highest numbers are the best odds, therefore, finding the biggest number assures the best return for the stake.
Like mentioned before, decimal odds represent the total winning amount that the bettor gets back upon winning the bet for every unit staked. It includes the initial stake in return, unlike the other types of odds. However, it is important to understand how decimal odds work to make money out of them.
The basic formula for decimal odd is:
Return = Stake * Odds
For a unit of $10 and the decimal odds being at 2.50, the return is $25, with the initial stake return of $10 and a $15 profit.
Double your money with decimal odds
When dealing with decimal odds, you can double your money by betting on the evens. In decimal odds, 2.0 is considered as evens which returns the bettor double money, including the initial stake and the amount staked as profit. For example, a bet placed at evens with a stake of $10 returns $20 to the bettor.
More than 50% chances of winning
You can use decimal odds for more than 50% chances of winning. With decimal odds, anything under 2.0 is considered as “odds on”, which is also considered to be more likely to occur with a more than 50% chance of winning. However, with an “odds on” bet, the bettor is required to stake higher than profit. For example, for the decimal odds of 1.40, the bettor gets a profit of 0.4 units for every unit wagered.
Profit more than initial stake
You can make profit more than the initial stakes using the “odds against” decimal odds. With decimal odds, anything above the 2.0 decimal odds is considered to be “Odds against”, which allows the bettor to earn profit more than their initial stake upon winning. However, the chances for winning with these decimal odds are less than 50%. For example, for decimal odds as 2.75, the bettor receives a return of 2.75 inclusive of a profit amounting to 1.75 for every 1 unit being staked.
Why Use Decimal Odds in Matched Betting?
- The major reason for using decimal odds is the simplicity of procedure they bring with them. It is really easy to calculate the return value by a simple multiplication of decimal odds with the amount betted.
- It becomes easier to match the bets and compare the closeness in the odds.
- The chances of event occurring are inversely proportional to odds, i.e. higher odds mean lesser chance of event occurring and vice versa.
To conclude, decimal odds remain an easier way for comparison of the odds at both the bookmaker and the exchange for finding bets that match the best.