Understanding betting
Reading and understanding betting odds: what's behind the numbers
A set of betting odds is a multiplier. It shows you the factor your stake is multiplied by. At odds of 2.00 with a 10-euro stake, you get 20 euros back. The higher the odds, the less likely the result and the bigger the possible payout.
Understanding betting odds is simple: payout equals stake times odds. With 10 euros at odds of 2.00, you get 20 euros back. High odds reflect results seen as unlikely. No system guarantees you lasting winnings.
Example calculation: a 10-euro stake at various decimal odds. Taxes and fees are not included. Source:Own calculation (stake x odds)
What are betting odds and how are they set?
A set of betting odds is a multiplier. It tells you how much you get back for every euro you stake if your bet wins. Odds are based on an estimate of how likely a result is. Statistics, current form, injuries and market experience all feed into that.
In your Tipico betting shop, you almost always work with decimal odds. Odds of 1.80 mean you get 1.80 euros back for every euro you stake. With a 10-euro stake, that is an 18-euro payout, so an 8-euro win. The odds always include your stake.
Odds are not neutral. Every set of odds has a margin built in that gives the bookmaker an edge over the long run. More on this in the section on the bookmaker's margin.
How do I work out the payout from the odds?
The basic formula is: payout = stake x odds. To find the win on its own, subtract your stake.
| Stake | Odds | Payout | Win |
|---|---|---|---|
| 10 euros | 1.50 | 15.00 euros | 5.00 euros |
| 10 euros | 2.00 | 20.00 euros | 10.00 euros |
| 10 euros | 3.00 | 30.00 euros | 20.00 euros |
| 10 euros | 5.00 | 50.00 euros | 40.00 euros |
Also bear in mind the betting tax of 5 percent. At Tipico it is not included in the odds but calculated separately. The examples in the table therefore only show stake times odds. How the tax is shown on your betting slip is set out in the terms of participation and on the slip itself.
What do odds say about probability?
From decimal odds, you can work out the implied probability. The formula is: probability = 1 / odds.
- Odds of 1.50: implied probability around 67 percent
- Odds of 2.00: implied probability 50 percent
- Odds of 3.00: implied probability around 33 percent
- Odds of 5.00: implied probability 20 percent
Low odds show that a result is seen as fairly likely. High odds reflect a more unlikely result. That means a bigger possible payout, but also a bigger risk.
On this, read our article on the different bet types too, to see how odds combine and multiply in accumulators and system bets.
What is the bookmaker's margin?
The bookmaker's margin, also called the overround, is the bookmaker's built-in structural edge. If you convert all the odds for a match into implied probabilities and add them up, the total comes to more than 100 percent. The amount above 100 percent is the margin.
For example, in a match with three possible outcomes, the implied probabilities often add up to 110 percent. Those 10 percentage points secure an edge over the long run. Across many bets, you get back on average less than you have staked. The margin is the business model of every legal sports betting provider.
It follows that no system and no strategy guarantees you lasting winnings. Sports betting is entertainment that costs money. You can read what strategies can and can't do on our page on sports betting strategies.
Which odds formats are there?
In German-speaking regions and in high-street betting shops, decimal odds are standard. They are the easiest to read and you can take them straight off as a multiplier.
There are other formats too:
- British odds (fractional odds): For example 3/2. This means you win 1.50 euros for every euro you stake. The total payout is 2.50 euros (your stake back plus the win), which matches decimal odds of 2.50.
- American odds (moneyline): A positive number such as +200 means you win 200 dollars on a 100-dollar stake. A negative number such as -150 means you have to stake 150 dollars to win 100 dollars.
In your betting shop, you will come across decimal odds almost exclusively. At the self-service terminal, you see the odds in real time and place your bets directly.
Why do odds differ between providers?
Odds are not set the same way everywhere. Every bookmaker works out its own estimate of the probability, builds in a margin of its own size and reacts at its own pace to incoming bets. If lots of customers back one team, its odds drop to even out the risk.
For how betting in a shop and online differ, see Betting shop vs online sports betting. Our guide Filling in and placing a betting slip explains how to place a bet.
Frequently asked questions
What do I need to know to understand betting odds?
The odds are a multiplier: payout equals stake times odds. With a 10-euro stake at odds of 2.00, you get 20 euros back, so a 10-euro win. From the odds you can also work out the implied probability: 1 divided by the odds. At odds of 2.00, that comes to 50 percent.
How do I read decimal odds correctly?
Decimal odds are your multiplier directly. Odds of 1.80 mean you get 1.80 euros back for every euro you stake. With a 20-euro stake, that is a 36-euro payout, so a 16-euro win. Your stake is already part of the payout. Odds below 2.00 mean you get back less than double your stake.
Why do odds drop before the match?
Odds change because lots of customers back a particular result. To manage the risk, the odds on the heavily backed result drop while the others rise. New information such as injuries or line-ups can also move odds at short notice.
How do I calculate the probability from a set of odds?
Divide 1 by the decimal odds. At odds of 2.50, that gives 1 divided by 2.50, which equals 0.40, so a 40 percent implied probability. One thing to note: because of the bookmaker's margin, the implied probabilities for a match always add up to more than 100 percent. That is the bookmaker's structural edge.
Where can I see the current odds at the betting shop?
You see the current odds in real time at the self-service terminal and on the screens in the shop. At a Tipico betting shop you work with licensed, up-to-date odds. After placing your bet, check the betting slip for the odds that apply.
