Learning how to calculate winning odds can help you to become a better gambler. Here are a few tips and tricks for calculating winning probability.
Bookmakers might not win every bet, but they almost always come out on top. Two main reasons for this are setting sharp lines and constantly adapting odds and payout. To maintain your house edge, it’s important that you know how to calculate winning odds.
Here, we’re going to talk about odds, probability, and how you can make more money as a bookie. Read on to learn how to implement top-notch lines with well-constructed odds.
Understand Probability and Odds
The words “probability” and “odds” are often used interchangeably, but they are not the same.
You calculate the probability of winning by dividing the chances of winning by the overall number of available chances. So if you were to enter a 100-person raffle, your probability of winning would be 1/100 (or 1%).
Odds are different because they are a ratio. They compare your chances of winning with your chances of losing. So, in the above situation, your odds of winning the raffle are 99 to 1.
Probability is useful in determining odds. However, you’ll need to take the necessary steps to calculate winning odds when setting the best bookie lines.
Determine Possible Outcomes
The first step toward determining odds is considering the possible outcomes of a situation. For a basic example, the 2022 Super Bowl had 2 possible general outcomes:
- LA Rams win / Cincinnati Bengals loss
- Cincinnati Bengals win / LA Rams loss
All that you would need to do to set odds is determine the likelihood of these possibilities and express odds numerically.
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Assess Past Data and Current Situations
To determine the likelihood of whether or not two sports teams will win or lose against each other, you’ll need to track past data. Some bookies choose to hire an oddsmaker to create competitive odds. Others DIY their lines without professional assistance.
When determining odds, consider:
- Each team’s past record of wins vs losses
- How many points each team usually wins/loses by
- Whether or not the teams have previously faced each other and what those specific records indicate
- Whether or not home advantage applies
- If home advantage does apply, how much this changes each team’s likelihood of winning
- Whether certain players are out of the game due to injuries (and how much impact that will have)
This data will help you to figure out more accurately what each team’s odds of winning are.
Express Winning Odds Numerically
Let’s say that there are two hypothetical teams: Team A and Team B. You assess all relevant information and determine that the odds of a Team A victory are 4 to 1.
Team A is the favored team. You can offer a lower payout to bettors here. They are more likely to win, but won’t win much.
Team A has a 4/5 probability of winning. This means that their odds in the fractional form are 4/1. In the most common format, you will display this on your website as 4:1 odds.
Team B is the underdog. The payout for those that bet on them will be higher. However, they are far less likely to win.
Upgrade Your Sports Betting Business Today
Calculating winning odds is the best way for both bookies and gamblers to make money. Now that you know how to do this, it’s time to set up your new bookmaking website.