How Do Sports Betting Odds Work?

Since the Professional and Amateur Sports Protection Act was overturned in May 2018, sports betting has exploded into the mainstream

With that, there are millions of U.S. players – possibly you? – getting into sports betting for the first time and likely wondering, “How do betting odds work?”

Before risking real money, it’s essential to understand how it all works, but here, we will focus solely on odds – how they work, what they are, and when they impact you and the potential fattening of your wallet.

If you want to understand sports odds strategy, have a reference for all things related to odds, or simply learn how to read sports odds, this page is for you.

Here we go – let’s dive into sports odds explained.

How Do the Numbers Work in Sports Betting Odds?

The most basic way to understand odds is that they reflect the possibility that an event will occur. Odds also indicate how you are paid out for each bet, whether it’s a moneyline bet, props, spreads, etc.

This is a rudimentary explanation, so we need to get more into the nitty-gritty to answer the question of “How do sports odds work?”

The following explanations will not just teach you how to read moneyline odds, but also explain betting lines for a variety of other situations.

Plus Odds

To keep everything easy to understand here, we’ll operate the following few sections with a $100 wager in mind.

On paper, plus odds are the more profitable bet. They indicate that what you’re wagering on is the underdog or less likely to happen.

You’ll often see +100 odds. What does +100 mean in betting? It’s the smallest plus line possible – it indicates something is an underdog, barely.

There are no +95 odds or +5 odds. Anything under +100 crosses into negative territory. On the other end of the spectrum, well, there is no end. Odds can go up to +6000, +35000, and beyond (i.e. wagering that a talent-deficient NHL defenseman will score a hat trick in his next game).

Negative Odds

Conversely, negative odds imply that what you’re wagering on is more likely to happen. By betting on a favorite, you’re taking less risk and will receive less of a payout with the same $100 bet. Negative odds represent lower risk and lower rewards.

The lowest negative odds possible are -105, though many sites don’t go below -110. Just like positive ones, negative odds can be in the thousands and beyond (i.e. you bet Gonzaga will cover a +7.5 alternate spread against Dartmouth … not very risky).

Calculating Your Payout

Continuing the use of the $100 bet, we’ll look at two examples below, one each for positive and negative odds. This is the fun part: understanding betting odds so you can calculate your winnings!

Strategy

While the odds are out of your control, that doesn’t mean that there aren’t ways to strategize around them.

Below are a few tips for using odds to your advantage.

Understand the Baseline Odds

With sports such as NFL, MLB, NBA, and NHL – the most popular sports to wager on in the United States – betting on the spread allows for the most upside, especially if you want to bet on a team favorite by moneyline standards.

When you go to bet on a spread, the baseline odds you’ll typically find are -110. This is important because, if this number is lower or higher, it could signal a potential change in the spread.

So, when you ask, “What does -110 mean in betting?” this is a great way to think of it.

Hedge Your Bets

There could be instances where you bet on a game at the beginning of the week, and, on the morning of, an injury or other development causes odds to abruptly change. By understanding the odds and the payouts, you can check in on where to wager to eliminate your potential losses.

Always remember: Your bet from days prior may not be as lucrative as you once thought.

Don’t Solely Bet Based on Odds

While there can be some mathematical strategies for betting based on odds, it’s vital to still evaluate each bet based on what you believe will happen. Don’t box yourself into a bet based on a certain dollar amount you wish to win.

Suppose you’ve evaluated a game or matchup and firmly believe in a certain outcome. In that case, it’s more than OK to look at the odds and decline to wager on something instead of forcing yourself into a bad bet because of the potential payout.

How Do Sportsbooks Decide the Odds?

There are plenty of times when you’ll look at the odds or lines for various moors betting online and wonder to yourself, “How did they come up with that?”

Sure, there are times when you’ll feel like you’ve found value. But sportsbooks must earn money to keep operating, so they deploy multiple methods to generate odds on sporting events.

In addition to advanced mathematical algorithms that make sure sportsbooks come out just a bit ahead, factors such as:

Furthermore, metrics like how a team performs in certain conditions (weather, road moors betting online, playoffs), the coaching staff, injuries, and more also factor in.

Comparing and Converting to American Odds

This page covers how American betting odds work, but what about other styles?

We’ve spent a lot of time talking about plus and negative odds, but depending on the site you’re playing at, the odds could be shown in a different format. This could be something you’re not used to, so let’s review other common ways odds are presented, and how to convert and compare.

Knowing these other methods can actually improve your understanding of how to read U.S. betting odds.

Fractional

Fractional odds are an odds format that originated in the United Kingdom and Ireland and was and still is mostly used for horse racing. However, they convert to American odds quite easily.

Here is another example: 25/1. Take 25, multiply it by 100, and you get +2500. (If you’re curious, this means your desired outcome has a 4% chance of happening.)

However, there are times that you’ll find different fractions, such as 10/11 or 11/4. The other formula to calculate betting odds is by carrying out the fraction as an isolated math problem, then multiplying by your wager.

So, with 11/4, you will get 2.75, or +275.

Decimal

Just like how plus and negative numbers are considered American odds, decimals are viewed as European odds.

These are easy to understand, too – don’t worry.

The easiest way to evaluate decimal odds is to take the decimal and multiply it by your wager amount to see the potential payout.

So, if you have a decimal of 2.30, this would be $230 on a $100 wager. You would get $100 back from your initial wager, and an additional $130, as 2.30 in decimal form equates to +130.

American

Whether you’re dealing with American, European, fractions, or something else, they all function the same way. However, the easiest way to understand American odds is that a negative line means favorite, whereas a plus line means underdog.

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