What Are Odds and How do They Relate to Sports Betting and Wagering?
Who could forget the moment right after the Boston Celtics won their 17th NBA Championship when Kevin Garnett dropped one of the most famous lines during a live interview that I can remember in quite some time. The big 6-foot 9-inch power forward was overcome with emotion and caught everyone by surprise when he shouted “anything is possible” three times in a row. That statement couldn’t be more accurate. Anything is possible and no matter what the “anything” is, it will likely have a set of odds attached to it. For example, the odds of being struck by lightning once in your life is 3000/1. Compare that to the odds of winning the Powerball jackpot which is 292,201,338/1 and you see what I’m getting at. Odds are very prevalent in our day to day life and even more so when it comes to sports betting and wagering.
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What are Odds?
In sports betting, when a sportsbook offers odds on a game or any type of bet, it is a representation of the payoff they are willing to offer bettors who correctly predict the outcome of said game or event. For example, if the odds on a game are 10/1, that means that for every dollar a bettor bets, the sportsbook is willing to return a profit of 10 dollars if the bet is a winner. On the other hand, if the odds were 1/9, then the bettor would have to bet nine dollars to receive a profit of one dollar. It should go without saying that the outcome with the 1/9 odds is much more likely to happen than the one with 10/1 odds.
Different Kinds of Odds
There are a number of different ways that odds can be expressed and it all depends what you are betting on and where you are placing your bets. In North America, the two most common odds types are the fractional odds and the American odds.
Fractional odds are what we discussed at the start of the article – 3000/1, 10/1, 1/9, etc. American odds are whole numbers and are commonly known used in relation to the money line. An example of American odds would be +300 or -400. There will almost always be a plus and minus option when odds are available. The money line odds give you a potential return in relation to a $100 bet. For example, if the odds were +300, then that means you would profit $300 for every $100 you bet if the bet was successful. This is the exact same as seeing 3/1 odds. If you happen to bet on the odds of -400, you would need to bet $400 to profit $100. This is the same as 1/4 odds.
Horse Racing Odds
Horse racing odds are similar to sports betting odds except they use fractional odds exclusively. Many amateur bettors don’t know how to read the tote board which in turn leaves them asking how much a particular horse would pay should they win. Here is a quick rundown of the most common odds in horse racing and their payouts on $2 bets.
1/5 pays out $2.40, 1/2 pays out $3.00, 1/1 pays out $4.00, 7/5 pays out $4.80, 9/5 pays out $5.60, 2/1 pays $6.00, 5/2 pays $7.00, 9/2 pays out $11.00 and 10/1 pays out $22.00.
The reason the numbers seem a little odd is because the minimum win bet in horse racing is $2.00. Therefor for odds of 10/1 you would add two numbers and then double them to get your $2.00 wager payout.
How Do Bettors React to Odds?
If you consider yourself a handicapper, you have basically one job and that is to determine what the true likelihood of a team winning or covering the spread is. Once you’ve done your own analysis, you can compare it to the current odds being offered. If you come to the conclusion that the odds are about equal, then it could be called a fair bet. If the comparison was favorable to you, then the opportunity to turn a profit over the long term is very achievable. On the flip side, if the odds aren’t high enough to cover the true risk of the bet, then any bet made on that event would be a losing proposition both in the moment and over the long haul.
At the end of the day, it doesn’t matter how the odds are expressed - fractional or American. They both represent the risk and reward of any given event and only when a bettor truly understands the difference between fair odds and lowball odds, is when they can start betting appropriately.
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