How To Calculate Payout On Odds

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• How To Calculate Payout On Odds
• How To Calculate Payout On Odds Ratio
• How To Calculate Payout On Odds Payouts
• How To Calculate Payout On Odds Genesis Open
• Odds Calculator And Payout American Odds
• How To Calculate Payout On Odds

How bookmakers “make” or calculate odds can be a little complicated for the new gambler. Here we explain the most basic way bookmakers calculate their odds. We all know that bookmakers make money by paying win bets and keeping the money from losing bets. However, this raises some simple questions:

• How does a bookmaker make money when the winnings and losses are the same?
• What happens when there are more winning bets than losing bets?
• Why don’t bookmakers go out of business when this happens?

Calculate your winnings quickly and easily with our online bet calculator.

The “Margin”

The answer to these three questions is the “margin”.

The “margin” is the “difference” (+/-) in the “real” chance of a result happening and the “actual” odds the bookmaker gives for the result happening. It is measured as a percentage (%) and is set at 100%.

For example:

When a bookmaker makes odds – they ask a number of questions. The first question is:

In a typical baseball game there are two possible results:

Team A will win or Team B will win

So the “real” chance as a % are Team A has a 50% chance of winning and Team B has a 50% chance of winning. (This equals 100%)

If we change the “%” to standard “odds” by bookmakers then this looks like:

Team A @ EVE and Team B @ EVE [EVE = EVENS – that is a 50/50 chance]
Or in “European” odds (decimal)

Team A @ 2.00
Team B @ 2.00

At these “odds” the margin is 0% - 50% + 50% = 100% so there is 0% difference FROM 100%

So if:

Person 1 bets $1 on Team A @ EVE or 2.00 And Person B bets $1 on Team B @ EVE or 2.00

The bookmaker has now got $2.00. ($1 from person 1 and $1 from person 2)

Then:

Team A wins – so the bookmaker will pay winnings to Person 1 and keep the losing bet from Person 2.
A win bet of $1 @ 2.00 (Evens) is $2. So the bookmaker gives Person 1 $2.

Put more simply:

Person A and Person B give $1 each to bookmaker. Bookmaker now has $2.

Team A wins.

Bookmaker pays $2 to Person A.
Bookmaker pays $0 to Person B.
Bookmaker has $0 balance.

The bookmaker has not made or lost any money. So the bookmaker asks a second question:

How can I make money from these two possible results?

Instead of giving “odds” of EVE or 2.00 for a 50/50% chance result, the bookmaker will “adjust” the odds a little (change the odds) to increase the % margin from 0% to say 10% (or 100% to 110%).

This reduces the possible payout for the same result – in this case from $2 to $1.91:

For example:

Team A to win @ 10/11 or 1.91
Team B to win @ 10/11 or 1.91

[EVE or 2.00 is reduced a little to 1.91 so they pay out is now 1.91 and not 2.00 for a $1 bet]

Again:

Person 1 bets $1 on Team A
Person 2 bets $1 on Team B

The bookmaker has now got $2.00. ($1 from person 1 and $1 from person 2)

Then:

Team A wins – A win bet of $1 @ 10/11 or 1.91 pays $1.91 so the bookmaker will pay $1.91 winnings to Person 1 and pay $0 to Person 2.

The bookmaker has now made $0.09. ($2 – $1.91) This is because the bookmaker’s “margin” had a +10% difference (110%). If Team B wins then the same thing happens, the bookmaker pays $1.91 to Person 2 and $0 to person 1 and “makes” $0.09.

What about when there are more than two possible results?

In a typical soccer game there are three possible results:

Team A wins or Team B wins or a Tie (Draw)

So the “real” chances are:

Team A has a 33.333 rec % chance of winning
Team B has a 33.333rec % chance of winning
A tie has a 33.333 rec % chance of happening.

So each result has a 1/3 (or “one in three”) chance of happening. If we change the chance % of 33.333rec to standard “odds” by bookmakers then this looks like:

Team A @ 33/100 Team B @ 33/100 A tie @ 33/100
Or in U.K. and decimal odds (European odds)

Team A @ 2/1 or 3.00
Team B @ 2/1 or 3.00
A tie @ 2/1 or 3.00

So if three people bet $1 each the bookmaker has $3 and will pay out $3 to the winner.

Again, with these odds the bookmaker won’t make any money so they “adjust” the odds as before so there is a % margin. The “adjusted” odds (might) become:

Team A @ 6/4 or 2.50
Team B @ 6/4 or 2.50
A tie @ 6/4 or 2.50

So the bookmaker has $3 [$1 from 3 people] but when they pay out they will only pay $2.50 to one person and so will keep $0.50. (This would be a 150% difference or a 50% margin).

So bookmakers adjust odds to make sure that whatever result happens they still keep some money after the bets have been paid to the winners.

The third question is:

But what if everyone bets on Team A to win, AND no-one bets on Team B to win, AND Team A wins?

If you take the two baseball teams – Team A and Team B it is very unlikely that they are both exactly the same level. Although they both have a 50/50% chance of winning the game, common sense says that one team will be better than the other. This means that the bookmakers will “adjust” the odds a lot more.

For example:

New York Yankees vs Boston Red Sox
Real chances are 50/50% or Eve or 2.00

They are then adjusted for the bookmaker to make a little money:

New York Yankees to win @ 10/11 or 1.91
Boston Red Sox to win @ 10/11 or 1.91

But for this game ten people think New York Yankees will win so all ten people put $1 each on the New York Yankees.

So now the bookmaker has a problem:

If the New York Yankees win they must pay 10 people 1.91 each and they only have $10 ($1 x 10 people) so they would lose $9.10 (they pay $1.91 x 10 people = $19.10).

So they need to “cover” that $9.10 margin.
So how do they “cover” that $9.10 margin?

If the New York Yankees win then that means (of course logically) that the Boston Red Sox will lose. So the bookmaker needs to get people to bet on Boston Red Sox so they can “cover” the result.

So to “cover” the “margin” they adjust the odds again…

They adjust the odds so that if New York Yankees win they will pay out LESS than $1.91:

So if the Yankees win then the bookmaker will pay out $1.33 instead of $1.91.

They have now reduced their (potential) losses from $9.10 to $3.30 ($1.33 x 10 people is $13.30)

But they still don’t have any bets on Boston Red Sox because people don’t think they will win, (or people think the odds are not very good even if they think Boston might win) so the bookmakers “adjust” the odds again….

They “adjust” the odds so if Boston Red Sox wins then they will pay out MORE than $1.91:

For example:Boston Red Sox @ 9/5 or 2.80

So if the Boston Red Sox win then the bookmaker will pay out $2.80 instead of $1.91.

Now they only need four people to bet on the Red Sox and their “margin” will be covered:

10 x people bet $1 on New York = $10
4 x people bet $1 on Boston = $4
The bookmaker now has $14

If New York Yankees win @ 1.33 x 10 (people) = $13.30 [The bookmaker keeps $0.70]
If Boston Red Sox win @ 2.80 x 4 (people) = $11.20 [The bookmaker keeps $2.80]

How do bookmakers calculate odds for Win only markets?

Of course there are markets such as “Which team will win the League?” or “Which player will win the tennis or golf tournament?”

In these markets there is only one possible result – someone will win the tournament! But the bookmakers offer many teams or players odds to win that league or tournament.

But unlike “match” result betting where the possible results are usually 2 or 3 [Win / Lose / Tie] in “Win” only markets there is only one result (Win) with many possible winners:

If we take the Premier League win market as an example:

There are 20 teams in the league so there are 20 possible teams that have a chance to win the Premier League. So the “real” chances are 20/1 or 21.00. But when you look at the odds the lowest odds might be 6/4 or 2.50 for Manchester City and the highest odds 5000/1 or 5001.00 for Swansea for example.

To calculate the odds in these markets the bookmakers use one, two or all three of the methods listed below (not in order):

• Statistics [Most people say “Stats”] known as the “Statistical Favorites”
• Opinion known as the “General Consensus”
• The amount of money placed on the teams known as the “Money Favorites” or simply “The Favorites”

Manchester City, Chelsea and Manchester United have won the league the most times in recent years so they will be the statistical favorites.

Manchester City, Chelsea and Manchester United will also be opinion favorites – most people in the media and people who like football think that one of those three teams will win the league.

Most people betting will bet that one of Manchester City, Chelsea and Manchester United will win the league or / and individuals will gamble large amounts of money on those teams to win the league which makes them money favorites.

So the bookmakers will “adjust” their odds to dramatically reduce how much they pay for the favorites e.g. Manchester City - and dramatically increase how much they will pay out for teams that most people believe will never win the league e.g. Swansea.

What are “fixed” odds?

These are often found on “coupons” for soccer and the odds are prepared days or weeks in advance, for calculating the odds for these fixtures the bookmakers use years and years of statistical data of both results and general overall betting patterns to choose their “odds”.

Coupons also encourage gamblers to bet on more than one fixture so the “chances” of two results happening increase dramatically.

For example two soccer games can have NINE (Fixture 1 has 3 possible results x Fixture 2 has 3 possible results) so the chances increase with the odds still low which means an increased margin – so it is easier for the bookmaker to cover margins in fixed odds betting.

What if the bookmaker cannot cover the (potential) losses?

There are a number of ways they may try to “cover” potential losses:

They may place bets with other bookmakers so they receive “winnings” which they can pay out to winners who bet with them. [This often happens in horse racing]

They may stop taking bets on a possible result and / or increase odds on other possible results.
They may set a bet limit of the amount people can bet on a result.
They simply take a “hit” and use profits from other events to cover the “loss”.

Final word

Online bookmakers make and calculate betting odds based on a lot of statstical data and customers habitual bets. And in order to earn profits regardless of the match result and league result without customers noticed, they adjust their odds and set margins. So to be good punter and get profits from bookies, you have to understand what they do, what they think about you. It's the first step to win constantly against bookmakers.

Moneyline bets present the most straightforward way to wager on a sports contest. A moneyline wager simply asks the bettor to choose which team will win a game, with no point spread involved.

The payout odds on the favorite and underdog can differ significantly on a moneyline bet. Using a moneyline calculator breaks down the math on the odds, which allows bettors to assess the true value on each side.

The following page includes the GamingToday.com MoneyLine Calculator, as well as several valuable tables and graphs designed to help bettors gain an edge with moneyline bets.

Moneyline Calculator

Fill in the dollar amount for your bet and the American Odds (for example -110) and calculate the implied probability and the return on the moneyline.:

What Is A Moneyline Bet?

Legal US sportsbooks generally present several different ways to wager on sports. Moneyline bets represent just one of several different wagering options, which include point spread, totals, parlays, and in-game betting.

Moneyline Bets

A moneyline wager allows the bettor to put a bet on which team or athlete will win a contest, straight up. The moneyline underdog will always pay out at better odds than the favorite.

Skilled bettors look for value on moneyline bets by evaluating teams that have a better chance of winning than the implied probability of the odds might dictate.

Moneyline favorites are listed with “-” odds, and the underdog is listed at “+” odds.

For example, here’s a look at a line offered by PointsBet on Game 1 of the 2020 World Series:

American Odds

PointsBet sets the Los Angeles Dodgers as the favorite in the game, with -165 moneyline odds. To calculate “-” odds, divide 100 by the odds, then multiply that quotient by the amount you bet.

For example, suppose you want to calculate how much profit a $50 bet on the Dodgers would yield. First divide 100 by 165 (without the “-”), which yields 60.6. Then multiply that number by your $50 bet to arrive at the profit (60.6*$50=$30.30).

A $50 bet on the Dodgers at -165 odds would yield $30.30 in profit. The $50 wager would return $80.30 to the bettor ($30.30 profit plus the original $50 bet).

To calculate “+” odds, divide the odds by 100 and multiply that product by the amount of the wager.

A $50 bet on the Tampa Bay Rays, for instance, would calculate as 140/100 (which yields 1.4), multiplied by $50 (1.4*$50=$70). A winning $50 moneyline bet on the Rays returns $120 total to the bettor ($70 profit plus the original $50 bet.)

Decimal Odds

Decimal odds can be used to make a simple calculation of odds multiplied by wager amount to arrive at the total amount returned to the bettor.

The -165 odds on Los Angeles, for example, convert to 1.6061 decimal odds using the Gaming Today moneyline calculator. Multiplying that by a $50 bet yields $80.30, and subtracting the original bet amount yields the profit earned ($80.30-$50=$30.30).

What Is A Moneyline Calculator?

The Gaming Today Moneyline Calculator allows for quick calculations for any wager amount and payout odds. Using American, decimal, fractional, Hong Kong, Indonesian, or Malay Odds, you can input the odds and the amount of a wager and see the payout that would come if the bet is a win.

While it’s valuable to understand and be able to calculate favorite and underdog Moneyline odds for all of the different odds notations, the moneyline calculator can save a significant amount of time and energy.

One of the most important features of the Gaming Today Moneyline Calculator is the Implied Probability feature.

For any favorite or underdog input, the calculator produces the implied probability of that team winning. Astute bettors can use the calculator to find teams that have a higher actual win probability than the implied probability dictated by the odds.

The “To Win” window displays the amount of profit yielded by any combination of odds and wager amount. To calculate the return to the bettor, add the “To Win” number to the original amount of the wager.

How To Use The Moneyline Calculator To Place A Sports Bet

Suppose you wanted to put the Gaming Today Moneyline Calculator to work to decide how you wanted to bet on Game 1 of the 2020 World Series. Here’s another look at the lines offered on that game by PointsBet:

To calculate a $50 moneyline wager on the Tampa Bay Rays, input $50 in the “Bet Amount” window and put “+140” in the “American Odds” window. Hit enter or click on the “Convert Odds” button and see how the moneyline calculator converts that information into several different useful categories.

The calculator converts the “+140” odds into all of the different notations you might see used by a sportsbook.

The +140 American odds convert to 2.40 decimal odds, 7/5 fractional odds, 1.40 for Indonesian/Hong Kong odds, and -0.7143 Malay Odds. A tool like our moneyline calculator can be a crucial component of a betting strategy when evaluating odds at sportsbooks that use different notations.

The “Implied Probability” output tells you that at +140 odds, the Rays have a 41.67% implied probability of winning. A skilled bettor will take that bet if they think Tampa Bay’s actual chance of winning the game is higher than that.

The “To Win” output yields the profit produced if the Rays win. A $50 winning bet on the Rays yields $70 in profit and a $120 total return to the bettor ($70 profit plus the $50 original bet).

Looking for other calculators to use when sports betting? Check out:

Calculating Positive And Negative Moneyline Odds

The math used in calculating the payout on a moneyline is pretty simple. It is one of the most important first steps to understanding sports betting and is crucial to success. Below is a graph of profit won on $100 bets for negative odds. Note that it is a curve that approaches, but will never get to $0. Even -1,000,000 odds still yields some profit from a win:

And here is a graph of profit for positive numbers. The really important difference is that the line is linear. as the odds increase, so does the profit. That goes on forever.

Looking at the odds offered by the sportsbook, note whether they are negative odds (for example -110) or positive odds (for example +120). The calculation changes based on if it is a positive or negative odd. Below we work through an example of a bet of $100 at -110 moneyline odds. It is important to notice that multiplying by -1 is required to give us the positive payout:

PAYOUT = BET AMOUNT / (-1 *MONEYLINE ODDS / 100)

So that looks like:

$90.91 = $100 / (-1 * -110/100)

That also means that you will be returned that amount AND your original bet, meaning you now have $190.91. Let’s work another negative example of a $100 bet at -150:

$100 / (-1 * -150 / 100) = $66.67

Now let’s work through a positive money example. Let’s say you bet $100 at +120

PAYOUT = BET AMOUNT * ODDS / 100

That looks like:

$120 = $100 * 120 / 100

How To Calculate Payout On Odds

In that case, you are returned your original bet plus profit, so you now have $220.

What Is Line Movement?

Sportsbooks make money by setting lines that bring in an appropriate amount of wagers on both sides of a bet. The house offers odds that factor in a cut of overall wagers, known as vig, that goes to the sportsbook.

In the World Series Game 1 example from above, if 90% of bets come in on the Dodgers, the sportsbook stands to lose big money if Los Angeles wins. A Tampa Bay win in that situation is even more disastrous for the sportsbook.

If the bets coming in on a game are too one-sided, the line on the game will start to move to try to prompt more bets for the other side. It’s important to remember that sports betting isn’t a zero-sum game, and you’ll be losing in the long run even if you win 50% of the time.

Legal Online Sports Betting In The US

A federal mandate known as the Professional and Amateur Sports Protection Act (PASPA) was overturned in May 2018, giving US states the legal clearance to offer state-regulated sports betting. Several states now offer both retail and online sports betting, including New Jersey, Pennsylvania, Nevada, Illinois, Indiana, Colorado, and several others.

The top online sport betting brands in the US include the following:

DraftKings Sportsbook

One of the biggest brands to emerge in the booming online sports betting industry, DraftKings Sportsbook offers mobile sports wagering in eight states. The sportsbook offers every imaginable kind of wager across multiple sports.

That betting menu includes daily moneyline opportunities on all major US sports leagues, as well as numerous international leagues. A tool like the Moneyline Calculator can be an indispensable tool to use for evaluating the odds and implied win probabilities at DraftKings Sportsbook.

FanDuel Sportsbook

Another huge player in the legal sports betting market, FanDuel Sportsbook offers mobile sports wagering in seven states. Along with DraftKings Sportsbook, FanDuel Sportsbooks stands as one of the top two mobile sports betting brands in the US.

FanDuel Sportsbook’s vast selection of moneyline wagering options becomes a potentially profitable market for bettors using a moneyline calculator. Such a tool allows sharp players to compare odds across multiple sportsbooks and only place the most favorable bets.

FOX Bet

How To Calculate Payout On Odds Ratio

A collaboration between FOX Sports and The Stars Group, the FOX Bet brand operates online sportsbooks in New Jersey, Pennsylvania, and Colorado.

The moneyline odds at FOX Bet can vary greatly versus some of its competitors, and bettors using a moneyline calculator tool gain a significant edge versus players that don’t.

Moneyline Calculator FAQs

Yes. More than a dozen states either currently offer online sports betting or have a launch of mobile sports betting products pending.

New Jersey, Nevada, and Pennsylvania represent the three biggest online sports betting markets in the US. Other states with legal online sports wagering include Colorado, Illinois, Indiana, Iowa, West Virginia, and a few others.

The Gaming Today Moneyline Calculator can be used as a valuable resource on any moneyline bet. It’s especially useful for evaluating the implied probability of winning and payout odds.

The moneyline bet calculator’s ability to display odds across multiple notation formats (American, Decimal, Fractional, Indonesian/Hong Kong, and Malay odds) allows bettors to compare lines across sportsbooks that use different notations.

Even if you’re a veteran sports bettor, running every bet you’re considering through the calculator provides significant benefit.

Yes. Nothing in the terms and conditions of any US legal online sportsbooks prohibits the use of a moneyline calculator.

The calculator provides computations that any person could produce with pen and paper but in a much faster and more efficient manner.

How To Calculate Payout On Odds Payouts

For “+” American odds, divide the odds by 100 and convert that quotient into a fraction. To convert +160 into fractional odds, for example, divide 160 by 100 (160/100) and reduce that fraction to the lowest whole number denominator. American odds of +160 would convert to 8/5 fractional odds.

For “-” American odds, divide 100 by the odds and convert to the simplest form fraction. For -160 odds, for example, the calculation looks like 100/160, which reduces to 5/8 fractional odds.

How To Calculate Payout On Odds Genesis Open

To convert “+” American odds to implied winning probability, the formula looks like this:

100 / (“+” American odds + 100)*100 = implied probability

For example, +160 odds would be calculated as 100/(160+100)*100. This converts to 100/260*100, which ends up yielding a 38.46% implied probability.

To convert “-” odds, the formula looks like this:

“-” odds / (“-” odds + 100)*100 = implied probability

Odds Calculator And Payout American Odds

For instance, -160 odds would translate to 160/(160+100)*100, converting to 160/260*100, which yields a product of 61.54. The implied probability of -160 odds is a 61.54% chance of winning.

How To Calculate Payout On Odds

Several online sportsbooks offer comprehensive coverage of sports and ways to bet. Some of the best choices for online sports betting in the US include DraftKings Sportsbook, FanDuel Sportsbook, PointsBet, FOX Bet, and BetMGM.