Odds are a way of showing how likely something is to happen and how much you'll win if it does happen.
Odds can be shown in different ways. In betting, the main forms of odds you'll see are:
Fractional odds - eg 7-1
Decimal odds - eg 11.0
American odds - eg +120 (used by American sportsbooks)
Percentage odds - eg 25% (shown as payouts in casino games)
To explain odds, we'll answer the two most important questions
How much will I win? AND What are the chances of it happening?
Decimal odds are the favoured method of displaying odds on betting exchanges such as betfair. With decimal odds, things are simpler as the figure quoted is the payout per unit staked. For example, for a £100 bet at Betfair,
7.0 pays out £700 (7.0 x £100 staked)
4.1 pays out £410 (4.1 x £100)
1.2 pays out £120 (1.2 x £100)
Remember, though, the great thing about Betfair is that it's an exchange (see our guide to betting exchanges). As such, Betfair are not an ordinary bookmaker - they don't set the odds. They allow bettors to choose whether to back or lay on an event, so you're effectively trying to outwit other punters. Great fun and very profitable if you know what you're doing. To help you get familiar with the exchange, they'll give you free £25 bet when you open your account.
Fractional odds are shown as A-B or A/B ie 'For every B units you bet, you will win A units' (We'll call A the 'return' and B the 'stake') eg
3-1 : every 1 unit you stake will return 3 units
7-2 : every 2 units you stake will return 7 units
9-4 : every 4 units you stake will return 9 units.
Your stake is returned with your winnings, so your payout (ie the money you're given) is A / B x stake + stake
eg if you bet £100 on a horse whose odds are 9-4, your overall payout on a winning bet is 9 / 4 x 100 + 100 = £325
You'll sometimes hear of an 'Odds on' favourite. What this means is that the event is so likely to happen that the bookies have set the odds so that the return is less than the stake.
1-2 (or 2-1 ON) means you get 1 unit for every 2 staked
2-7 (or 7-2 ON) means you get 2 units for every 7 staked
Don't forget, though, that your original bet is still returned, so you still win overall.
Eg a £100 bet on a horse at 1-2 pays out £150 (1 / 2 x 100 + 100).
American sportsbooks have a slightly different way of showing odds, which is known as a moneyline. It's very often used in NFL matches, for example, where one team is the favourite and one is the underdog. For example, you may see the following betting options for a match:
Chicago Bears -140
Dallas Cowboys +110
Moneyline odds are shown in two ways - the favourite as a negative number, the underdog as a positive.
If the figure quoted is positive, the odds show how much you'd win on a $100 wager. Positive numbers are the same as Odds Against.
If the figure quoted is negative, the odds show how much you'd need to wager in order to win $100. Negative numbers are the same as Odds On.
For a comparison of moneyline odds versus fractional and decimal, see the table below.
Percentage odds are an accurate way of showing how likely something is to happen (see below).
Asian sportsbooks such as 138 will use probability when quoting sports betting odds, but you'll most likely come across percentage odds when playing at casinos.
Casinos use percentages to show the odds of individual bets in a game, plus the overall payout rate for the casino. The closer the payout is to 100%, the more likely you are to win.