# Decimal Odds in Betting Explained

Contents

In this article, we discuss **decimal odds in betting**. We **define betting odds**, explain **how decimal** odds work in betting, reveal **how you can use decimal odds to make money** and illustrate the relative **advantages of using decimal odds** rather than fractional odds.

Betting and odds are **two sides of the same coin**: you **cannot have one without the other**. Odds represent the **probability of an event happening**. When you bet on an event, you must **first consider the odds offered** on the event to decide **whether it’s worth** the wager. When the **probability of an event is low**, the **odds offered** are correspondingly **high**. In other words, you can **win a higher return** on your wager on the happening of a **more unlikely event**. Sportsbook operators **display betting odds in many formats**, of which **decimal and fractional formats** are the **most universal**.

## How Do Decimal Odds Work in Betting?

Decimal odds are **easy to understand**. For instance, in a cricket match between India and Australia, the **respective odds may appear as 1.80 and 1.95**. So, if you placed ₹100 on India to win the game, **you would get ****₹****180 (100 x 1.80**) if India won. Similarly, **₹****100 wagered on an Australian win** would fetch you a return on investment of **₹****195 (100 x 1.95)** if Australia emerged victorious. Thus, you would **earn more from a bet on an Australia win**, though the **event is less likely to happen**. Also, **your return (****₹****180 or ****₹****195) would include the original stake** of ₹100. In the above example, **fractional odds would appear as 4/5** (80/100) **and 4.75**/10 (95/100).

## What Are Decimal Odds?

The decimal odds of an event **will include the amount staked as well as the return on that stake**. So, by looking at the odds offered, we can **understand what proportion of the staked amount we can earn**. For example, decimal odds of 1.80 on an event will tell us that **on a stake of ****₹****1** we can get a **return of 80 paise**. (One rupee equals 100 paise.)

Decimal odds can **help us to deduce** (a) What **return we can get** on our stake and (b) Whether **our betting decision is more likely to succeed**.

## How to Use Decimal Odds to Make Money

An event **in which we can earn** an amount **higher than the amount staked** is **an example of an “odds against” event**. Thus, if on a stake of ₹1, we can get a return of more than ₹1, say 4, that would be an example of “odds against.” In such case, **the odds would be quoted as 5.0**.

An event in which we can earn an amount **less than the amount staked** is an **example of an “odds on” event**. Thus, if on a stake of ₹1, we get a return of less than ₹1, say 0.9, that would be an example of “odds on.” In such case, the **odds would be quoted as 1.9**.

An event in which we can earn **an amount equal to the amount staked** is an **example of an “odds even”** event. Thus, if on a stake of ₹1, we get an equal return of ₹1, that would be an example of “odds even.” In such case, the **odds would be quoted as 2.0.**

## Advantages of Decimal Odds

### It is easier to convert decimal odds to implied probability

- Let’s
**consider the example of India vs Australia**that we have**mentioned earlier**. We were given odds of 1.80 on India and 1.95 on Australia: - The
**implied probability**that**India will win**can be calculated as 1/1.8 =**55.55%**chances of winning. - The
**implied probability**that**Australia will win**can be calculated as 1/1.95**= 51.28%**chances of winning. - Once we have calculated the implied probability for each of the two possible events, we not only realise that
**India are more likely to win**than Australia but**also understand how much more likely.**

### Fractional odds can also become harder to understand

This is **especially so when very large numbers **result from our calculations. To cite an example, **decimal odds of 1.36** can be converted into **fractional odds of 18/50 or 9/25**. If you plan to bet ₹10, it is **easier to calculate your returns from the decimal odds** which tell you that you will get a **return of ****₹****3.60 on your stake**.

Another instance when **fractional odds become harder to understand** is when the **probability of an event is relatively high**. For instance, **decimal odds of 1.5** will convert into **fractional odds of 1/2.** In another instance, the fractional odds of an event can be quoted as 2/1 which could lead to some confusion unless that bettor has prior experience.

## Why Is It Important to Understand Odds?

If you are unable to understand odds, **you won’t know how much you are likely to earn** from a bet and **whether you are getting good returns** on your stake in a wagering transaction.

## Should I Switch to Decimal Odds?

Decimal odds are **easier to understand than fractional odds**. For instance, decimal odds of 1.80 can also be quoted as fractional odds. A fractional odd is **derived by dividing the amount of returns by the amount staked.** Thus, **decimal odds of 1.80** will convert into **fractional odds of .8/1 or 8/10 or 4/5.**

Let’s assume that **we are trying to figure out** how much we can earn and **whether we are getting good returns** by looking at **fractional odds of 4/5**. We **must do many mental calculations**. For instance, we must **first conclude that on an investment of 5 we can earn a return of 4**. Then we can **further deduce that we can get 4/5×100 = 80% returns**.

However, when we look at **decimal odds of 1.8**, a **single glance** tells us that we can get **returns of ****₹****80 on ****₹****100 invested.** This simplicity and ease of understanding is the **main reason many sportsbook operators have switched** from fractional to decimal odds.

## In Conclusion

When we bet on a sporting event, we would like to know **how likely it is that a preferred event (such as a win) happens.** Thus, odds tell us about **the implied probability of the desired event**. Most **sportsbook operators choose decimal odds**, odds with a decimal point separating two figures. The decimal odds of an event **will include the amount staked** as well as **the return on that stake.**