How Sports Betting Odds Work
Did you know that the sports betting market is expected to reach $179.3 billion in value by the year 2028? When you consider the high-octane nature of sports betting, this statistic isn’t surprising.
Watching sports already provides an adrenaline rush, but when money is on the line, that feeling is even more intense. Unfortunately, many newcomers are often intimidated by the mechanics of sports betting.
Specifically by confusing concepts like betting odds and how they’re calculated. That’s why we made this sports betting odds explained guide.
In it, we’ll be going over everything you need to know about sports betting odds. That way, you can start placing bets on your favorite sports with confidence.
What Are Sports Betting Odds?
Before we learn how sports odds work, let’s first go over a quick definition. These types of odds refer to the theoretical likeness of a certain outcome occurring with a specific sports game.
These lines will detail the probability of a team winning or losing. Lines refer to the expected circumstances for a victory or a defeat. For example, you might see a line that reads Chicago Bulls -5.
That means that in that the Bulls would need to win by at least five points for you to win the bet. Sports betting odds are also an important part of determining how much money you need to wager to get a certain amount of profit.
Sounds simple? Guess again. As we’ll cover in the next sections, there are a variety of different ways to calculate odds, depending on the country you’re betting in and the game you’re betting on.
However, by the end of this article, you’ll be an expert on the subject. Let’s continue.
Who Sets Sports Betting Odds?
No, there’s not a voice in the sky that’s handing down betting odds. Instead, the odds you’ll find online are set by sportsbooks before being offered to bettors.
Now, these odds are typically either set by two different parties. Sometimes sportsbooks rely on third-party firms to help them set their odds. The Kambi Group is a popular third-party firm that you’ll likely encounter if you bet frequently.
Other sportsbooks will use rely on their in-house development teams to set the odds. So, what factors do these oddsmakers use when deciding the likelihood of who’s going to win or lose?
Typically, most groups will use advanced algorithms, outside consultants, and power rankings to set their odds and lines. It’s common for certain odds to be identical across different websites.
However, some odds might be altered if a certain sportsbook is running a promotion. So, it can be worth it to shop around to find the best odds for your specific bet.
What Are the Different Types of Odds?
There are three main types of odds used in betting: American odds, fractional odds, and decimal odds. As you can guess, American odds are commonly used in the United States, while fractionals and decimals are more common outside the USA.
That being said, you can still find plenty of American sportsbooks that use fractionals and decimals for calculating odds.
In this section, we’ll go over each of these types of odds and how they work. That way, you’ll know what you’re seeing whenever you encounter them.
American odds have grown in popularity ever since the Supreme Court repealed a ban on sports betting with their ruling on a 2017 case. That being said, they can be a bit more confusing to understand than fractional or decimal odds.
All American odds are typically based around a $100 amount. These bet odds can either be favored or not favored. If a bet is favored, then you’re going to see a negative number.
This negative number tells you how much you’re going to need to bet to win $100. For example, let’s say a favored team has odds that place them at -200.
That means that to win $100, you would need to bet $200 on the favored team. However, it’s important to note that you don’t need to bet $200 on this type of bet. The bets can easily be scaled up or down.
For example, if you bet $10 on the team with -200 odds, then you would get $5 if they win. If an odd has a plus sign next to it, then it means they’re the underdogs. You stand to gain a lot more from a team that has +200 odds.
In this situation, if you bet $100, then you would gain $200 in profit as well as your original bet. So, while underdog bets are riskier, you would need to bet less to gain more.
Fractional odds are pretty simple. You’ll be given a fraction, like ½ or 4/1. To figure out the profit you stand to gain, all you need to do is multiply your wager by the fraction amount.
So, if you bet $1 on ½ odds, then you can stand to gain $0.50 in profit. Or, if you bet on an underdog with the $4/1 odds, then you could make $4 in profit.
In addition to this profit, you will also get your original wager back if you win.
Lastly, there are decimal odds. These odds are represented by one number. They show the amount of money that you can win for every $1 you bet on a team.
For example, if you bet $1 on a team with 4.0 decimal odds, then you would get $5 back. $4 of that would be from profit, while the other $1 would be the original wager that you’re getting back.
Remember that these odds can also be scaled up easily. In the 4.0 example, if you bet $20, then you would make $40 in profit if you won the bet.
With decimal odds, if the odds are between 1.0 and 2.0, then it means you’re betting on a favorite. If the odds are over 2.0, it means you’re betting on an underdog.
Sports Betting Odds Explained For Different Sports
We’ve gone over some of the different odds you’re likely to encounter while sports betting. However, it’s also important to note that odds also differ depending on what sport you’re betting on.
Don’t panic. The odd differences from sport to sport are only slight. Once you get a handle on them, you can easily move from game to game without a problem.
Odds For Football and Basketball
When you’re betting on football, there are three concepts that you need to be familiar with: the point spread, moneyline odds, and the over/under. Let’s start with the point spread.
You’ll likely see a team with a positive or negative number next to their odds, like this +7 (-110). If it’s a plus sign, that means that the team is the underdog.
As such, in that previous example, they would have seven points added to their final score at the end of the game. If they have a negative number, then they’re the favorite, and that point amount will be subtracted instead.
Moneyline refers to the amount of money you would need to bet to profit $100. So, if a team’s moneyline odds are -190, then you would need to bet $190 to profit $100 on the game.
Lastly, there’s the over/under. This is a specific point amount that you’re betting a team will either score over or under. Odds will be placed next to this point amount to determine how much you need to bet to win.
Make sure to check out this resource if you want to learn more about NFL computer picks.
The good news is that the odds for football and basketball are the same. So, you should have no trouble switching between these two games.
Odds For Baseball
The odds for baseball are different from football and basketball. The over/under bets and the moneyline odds operate in the same way. But, in baseball, it’s difficult to assign a game with a specific point spread.
So, to compensate for this, you’ll see most oddsmakers apply a run line instead. The run line will be 1.5 runs that are either added to or subtracted from the favorites/underdogs.
So, for the favorites to win, they would need to win by at least two or more runs than the underdog. For the underdog to win, they either need to win completely or lose by one run or less.
Appreciate Learning About Sports Betting Odds? Keep Exploring
We hope this sports betting odds explained guide helped you learn more about this important concept in sports gambling. For newcomers, sports betting odds can often feel random and confusing.
But remember that the longer you stick with it the clearer it will become. So, start slow and keep trying until you get a good handle on it.
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