Decimal Odds | What Are Decimal Odds? How Do They Work?

Posted on by Toby @ Punter2Pro
  • Decimal odds represent the total payout a bettor will receive, including their original stake, for each unit wagered.
Decimal Odds | What Are Decimal Odds? How Do They Work?

Decimal odds represent the total payout a bettor will receive, including their original stake, for each unit wagered

What Are Decimal Odds?

Decimal or “European” odds are a popular and intuitive format for expressing the potential winnings of an a bet. The format is used across Europe, and is the default format on sports betting exchanges.

Unlike other odds formats such as Fractional or American odds, decimal odds represent the total amount that will be paid out to the bettor if their bet is successful, including the original stake.

Decimal odds are presented as a number with two decimal places, such as 2.50 or 1.75. Calculating potential winnings with decimal odds is simple: you multiply the amount of the bet by the decimal odds. For the profit, you then subtract the stake as follows:

Profit = (stake x decimal odds) - stake

For example, if you bet €50 at odds of 2.00, your potential payout would be €100 (€50 x 2.00 = €100). The potential profit would be €50 (€100 return – €50 stake).

As decimal odds represent the total payout, it’s easy to compare odds across different bookmakers. Essentially the higher the decimal odds are, the higher the potential payout is.

Decimal odds can be converted into  percentages (known as the implied probability) using the following formula:

Implied Probability = (1 / decimal odds) x 100

Let’s say you have decimal odds of 2.5 for an event. The implied probability is calculated as: (1 / 2.5 x 100) = 0.4 x 100 = 40%

Example 1

Manchester City to win against Chelsea at odds of 1.85 with a stake of €100:

  • Return = stake x odds = €100 x 1.85 = €185
  • Profit = return – stake = €185 – €100 = €85

Example 2

Rafael Nadal to win the French Open at odds of 3.50 with a stake of €50:

  • Return = stake x odds = €50 x 3.50 = €175
  • Profit = return – stake = €175 – €50 = €125

Example 3

Lewis Hamilton to win the Monaco Grand Prix at odds of 2.25 with a stake of €200:

  • Return = stake x odds = €200 x 2.25 = €450
  • Profit = return – stake = €450 – €200 = €250

Pros & Cons of Decimal Odds

Here are of the main pros and cons of using decimal odds in sports betting:

Pros

  • Easy to Understand

    Decimal odds are very straightforward to understand and calculate. The number represents the total payout including the original stake, making it easy to determine potential winnings and compare odds across different bookmakers.

  • Transparent

    Decimal odds are transparent, and it is easy to see how much the bookmaker is charging for their services. This makes it easier for bettors to make informed decisions.

  • Widely Used

    Decimal odds are used by many bookmakers and betting sites around the world, making them a common and familiar format for sports bettors.

  • Simple to Convert to Percentages

    Decimal odds can be easily converted into probabilities by dividing 1 by the decimal odds and multiplying by 100.

Cons

  • Unfamiliar to Many

    Some bettors may be unfamiliar with decimal odds, particularly if they are used to other formats such as fractional or American odds. This could lead to confusion and mistakes when placing bets.

  • No Indication of Underdogs

    Decimal odds do not provide any indication of which team or player is considered the underdog. Bettors need to look at all outcomes to determine which is most likely to win.

More Odds Formats

Fractional Odds | What Are Fractional Odds? How Do They Work?
American Odds | What Are US Moneyline Odds? How Do They Work?
Hong Kong Odds | What Are HK Odds? How Do They Work?
Malaysian Odds | What Are Malay Odds? How Do They Work?
Indonesian Odds | What Are Indonesian Odds? How Do They Work?
Implied Probability | The Chance Of An Event Occurring
Toby @ Punter2Pro
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