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Guide to Sports Betting Odds: Learn How to Read Every Odds Format

Earnest Horn
Written by:
Last Updated: July 2nd, 2024

Understanding how sports betting odds is an obvious first step to becoming a successful bettor. Odds can vary from book to book and can shift in seconds, particularly when betting on live games.

Though this can be intimidating at first, we'll cover the basics of the process so that you'll feel more comfortable when placing your wagers (whether via an in-person sportsbook or online betting app).

In this guide we will cover the following key topics:

  • Types of sports betting odds
  • How each type of odds works
  • How sportsbooks set the odds for a betting event
  • What moves odds prior to and during a betting event

Types of Betting Odds

There are three types of odds bettors need to understand prior to placing a bet. These include American odds, decimal odds, and fractional odds.

As a U.S. sports bettor, you will typically deal with American odds. These are what you will find when betting on the NFL, NBA, NHL, MLB, college football, and college basketball.

That being said, decimal odds are often considered to be easier to read and are easiest to convert into probability. Most sportsbooks will allow you to switch to decimal odds right from the website or app. Decimal odds are most commonly used throughout the UK.

Fractional odds are much less common and most bettors only use them when betting on horse racing, golfing, and futures.

Let's take a closer look at how each type of betting odds works.

How American Odds Work

Have you ever been in a sportsbook or glanced at the back page of the sports page to see the betting odds? You may have seen odds for an MLB game that read: Yankees (-180) at Orioles (+160). We'll explain exactly what this means below.

betting odds explained - american odds

Calculating Probability with American Odds

American odds are the default odds shown on most US sportsbooks. Once you are used to reading these odds, you will inherently know exactly what the odds/probability is without having to break out a calculator. That being said, you will likely want one for this lesson, let's jump into how you calculate probability and payouts using American odds.

calculating payout using american odds

Calculating Payouts with American Odds

Using our Yankees (-180) at Orioles (+160) example from above, here is how the process works. Since the Yankees are the favorite, you'd have to risk $180 to win $100. That's a pretty steep price to pay, but worth it if you think the Yankees are a lock to win and should be priced with odds of -200 or more.

If you like the Orioles to win, you can risk $100 to win $160. Since Baltimore is a steep underdog, the payoff is much greater.

Just how powerful is the juice? A +160 underdog only needs to win 38.5% of the time for you to break even. On the contrary, -180 favorites need to win 64.3% of the time just to break even.

How Decimal Odds Work

It is important to understand how American odds work for several reasons. While you can choose to display odds as decimal odds on your sportsbook's website or app, often times odds are displayed as American odds when discussed, written about, or displayed inside of brick-and-mortar sportsbook locations.

That being said, decimal odds are a much simpler betting odds system, and are by far the most popular odds system on a global level. Let's take a look at how decimal odds work and how you can calculate probability and payouts using decimal odds.

calculating probability with decimal odds

Calculating Probability with Decimal Odds

As you can see in the graphic calculating probability with decimal odds is considerably easier than calculating probability with American odds. The formula is extremely straight forward, and does not need to be adjusted for what is considered negative odds in the American odds format.

Simply divide one by the decimal odds for that given bet. The closer odds get to 1, the higher the probability the bet will pay out. A heavy favorite may have odds of only 1.05 which would of course indicate a 95.23% win probability.

payout with decimal odds

Calculating Payouts with Decimal Odds

Calculating payouts with decimal odds is considerably easier as well. Simply multiply your bet amount by the decimal odds, then subtract the bet amount out of the total payout to calculate your winnings.

As you can see in the example, a $10 bet with 2.3 odds would pay out a total of $23. When you subtract out your bet ($10), you are left with $13 in total winnings. Assuming you are betting even dollar amounts like $10, $20, $100... you should be able to calculate winnings in your head when betting using decimal odds.

How Fractional Odds Work

As we mentioned in the open, fractional odds are the least often used form of betting odds. Where you typically see this format is where you have a field of players, teams, or horses. Obviously this means you find fractional odds when betting on team futures like Super Bowl odds, player futures like MVP odds, PGA tournaments, and horse races.

While fractional odds look different, calculating probability and payout with them is a fairly straight-forward process. Here is exactly how you use fractional odds.

probability with fractional odds

Calculating Probability with Fractional Odds

To calculate probability with fractional odds you simply need to memorize the quick formula shown on the left side of the graphic above. The formula for fractional odds probability is denominator divided by denominator plus numerator. So, given odds of 9/2, the formula would give you a probability of 2 divided by 9 plus 2, or or 2/11. Solving will give you a probability of 18.18%.

Again, you will find this format anytime you have a field of potential winners. If you think a boxer has a 75% chance of winning, but an odds probability of 60%, that would be a great bet to make.

calculating payout with fractional betting odds

Calculating Payouts with Fractional Odds

Calculating payouts with fractional odds is just about as easy as calculating payouts using decimal odds. Simply multiply your bet by the fractional odds. In the case of the given example, a $10 bet with 9/2 odds, would pay out $45 - ($10 x (9/2).

Because these odds are used in events with a field, you will often find big payouts in events that feature fractional odds. Again, the most common bets you will make with fractional odds are futures like preseason Super Bowl odds, PGA bets (golfer vs the field), and horse racing bets.

How Sportsbooks Set Odds

Most bettors will tell you that sportsbooks are really good at setting lines and odds for games, but did you know that sportsbooks are not actually trying to set an accurate line?

Sportsbooks make money off of the juice applied to the bets they offer. This means that when two teams play and both have odds of -110, the sportsbook should take 10% of total bets.

However, if 80% of bettors pick the correct side of a bet, the sportsbook would lose much more than 10%. It is therefore in the sportsbook's best interest to set odds that result in an equal number of bettors taking each side.

What Sportsbooks Offer the Best Odds?

Experienced sports bettors know that odds shopping is essential to long-term success. Odds can vary widely between sportsbooks creating an opportunity to find better odds or reduced juice for most bets.

Our team has tracked betting odds across every major sport for years and can say that no sportsbook is truly the best, but several stand out. For instance, PointsBet tends to offer the lowest juice on every fixed-odds NFL wager, while DraftKings offers the best odds for most player props.

We recommend using our odds checker prior to placing any bet to ensure you are getting the best odds at the best price.

What Moves Odds for Betting Events

One thing you will notice as you get started with sports betting is that odds move quite often. A team that opens a week as a 7-point favorite may only be a 3-point favorite by the time the game actually starts.

There are a variety of reasons sportsbooks change odds for a betting event, including:

  • Lopsided betting: Remember back to our earlier statement that sportsbooks want to set odds that encourage equal betting on each side of a game. If the majority of the money bet on a game is on one side, sportsbooks will move the odds to encourage bettors to back the other side of the wager.
  • Injuries and suspensions: If a star player is injured or suspended prior to the start of a game, it can drastically shift the odds. For instance, if it is announced that a team will be without their starting quarterback, the odds will likely move in the favor of the opposing team and the over/under for the game will move down.
  • Weather conditions: One of the more overlooked causes for odds changes is weather. Poor weather often reduces the odds that a favorite will cover the spread and also reduces the total number of points projected to be scored in the game.

Bettors should always be aware of odds changes, as these can present an opportunity to find value as the game's start time approaches.

Betting Odds FAQ

Have more questions about betting odds? You've come to the right place! We've provided answers to some of the most frequently asked questions below. We've also thrown in a few tips about how to get the best odds.

What do the plus and minus signs mean when looking at betting odds?

When checking betting odds in the American format, you'll see either a - or a + in front of the number. The minus sign means you have to have to risk that amount to win back $100. For example, -110 means you bet $110 to win $100 back for a total payout of $210 ($100 in winnings plus your original bet of $110). When you see a plus sign, the next number tells you how much you can win if the underdog wins. For example, +120 means that you'll win $120 on a $100 bet.

How can I make sure I'm getting the best betting odds possible?

The best way to ensure you're getting the best odds is to give yourself plenty of betting options. Sign up for an account with every legal sportsbook in your state so that you can shop around for the best odds!

Is there a certain time of the week where I can get the best betting odds?

There is no set in stone rule for getting the best odds. However, it's generally a good practice to bet the favorites you like early and the underdogs you like later in the week.

How do sportsbooks set betting odds?

There's no real way of knowing how sportsbooks set their lines. Some employ tons of math geniuses to accomplish this task while others will simply copy what other sportsbooks have as their numbers.

Is there an easier way to shopping around for the best betting odds?

Yes, we've built an Odds Tool that automatically tells you which sportsbook in your state has the best line and the best odds. Simply select your state and the sport you want to see and you're in business. 

Betting Odds Summary

Understanding how these three types of betting odds work is essential to becoming a profitable sports bettor. While all the numbers you see across sportsbooks may seem intimidating at first, with practice you will get really fast at calculating probabilities and payouts.

Bookmark this page and reference back to it as needed as you get started in sports betting. Even better yet, subscribe to our newsletter to get a weekly email that breaks down odds, probabilities and payouts for you!

Earnest Horn

Earnest is a 25-year veteran of the newspaper industry. He's spent the majority of his early years working as a sports reporter and editor. He made the move back to the digital world in 2022, joining EatWatchBet as a senior writer. Ernie covers college football betting, fantasy football, and NFL betting for EatWatchBet.