In this feature, we go back to basics with the very fundamentals that sit behind sports betting. We explain what different types of odds are, how they are created, and most importantly, how it is possible to beat them.

How it started

When I was about ten years old my parents took me and my sister to my local point-to-point race meeting, Horesheath in Cambridgeshire.

We picked a 25/1 outsider because we liked its name, “Jack The Lad” if memory serves. (Jack was the name of my grandfather. It was the most simple of predictive algorithms and one still very popular when people pick a runner once a year in the Grand National.)

We split a £1 stake down the middle, 50p each.

The idea of pocketing £12.50 for picking a horse seemed too good to be true to me. Watching the race unfold was beyond exciting.  And when the horse won and we actually collected the cash, it nearly blew my peanut-sized mind.

(At the time, £12.50 wasn’t enough to buy a new CD album, so I decided to spend my winnings on “clothes” (plural)… the mind boggles.)

I wonder if it was this rainy day in the Cambridgeshire countryside that led to my fascination with sports-betting, with predictions, odds, value and probability. It was certainly my first experience of betting. 

It was a few years later, on the verge of becoming a teenager when I woke up one night with a eureka moment, convinced I had an idea that would make me rich…

If Jack The Lad could bring me all those riches when I had only backed ONE horse, why don’t I just back EVERY horse in the race…? My working-theory was that no matter which horse won, I’d have money on it, and I would win too. Simple. I was genuinely excited about this opportunity to make my fortune.

It didnt't take me long to realise that this would not work in the real-world, and while I did not know the terminology at the time, I had stumbled across the concepts that underpin everything that makes sports bookmaking possible.    

It was with this entirely misguided appreciation of sports-betting and odds-making that was the starting point which would evolve into a full understanding of betting concepts and practises that are essential to be successful and to win. It was shortly after my Horseheath win that I would start backing my opinions whenever I could, often getting the bookmakers to give me odds on my own markets, in the firm belief that it was punter-vs-bookmaker and they could be beaten... 

The point of me sharing this story is to illustrate that everyone starts somewhere.

The classic coin toss

Let's start by introducing some essential terminology:  stake, return and profit. 

If you were to bet on the outcome of a toss of a fair coin, you should know two things.  One, that the outcome has a 50% chance of being Heads and a 50% chance of being Tails.   And two, that the "fair" (true) odds for a bet on this event should reflect those odds.   

Correctly calling Heads with a bet of £1 should result in a profit of £1.  You would have staked £1, won the bet, and had a return of £2.  The profit being the difference between your return and your stake.

Conversely, if you called Heads and lost, you would lose your £1 stake.  The difference between your return of £0 and your stake of £1 being a £1 loss.  

OK, so that is what the true odds should be, the fair price for taking on the bet.  In this situation, traditionally the odds would be displayed based on the lowest possilble fraction,  like this:  profit / stake. This means that our fair coin-toss bet would be offered at traditional fractional odds of 1/1 (this is known as "even-money" or "evens").  

How odds are displayed

When you see odds of 4/1 ("four to one") for a horse, a tennis player, a boxer or a football team to win, you are being offered a £4 profit for every £1 you are prepared to stake.   Sometimes the fraction does not work as odds "to one" though.  You will have seen odds of 9/2 ("nine to two") and 7/4 ("seven to four") and in these cases you need to unpack the fraction to determine the profit.   

If you click this link, you can find a number of free tools that allow rapid conversions of all three main odds formats (fractional, decimal, US format).

The SharpBetting essential toolbox

Odds of 9/2 can be reduced down to a potential profit of £4.50 (9 divided by 2) for every £1 that you bet.  Odds of 7/4 can be reduced down to a potential profit of £1.75 for each £1 you are prepared to stake.  So, whenever you see any type of fractional odds, simply do the conversion to work out what your return is. 

Decimal Odds format

At SharpBetting.co.uk, we always refer to decimal odds rather than fractional.  They allow for a more precise assessment of the bet in question.

Decimal odds are shown in the format of "1.85", "2.75", "15.00", etc and they will never use the "/" fraction symbol.  This makes them a far more straightforward way of assessing the odds available.

To understand decimal odds, they simply tell you what your return would be for every £1 staked if the bet wins.   For instance, the fractional odds of 9/2 that were discussed above would be 5.50 in decimal format. That means that I instantly know that for every £1 that I wish to bet, I will get a return of £5.50, which is a profit of £4.50.   Odds of 7/4 would be 2.75, so my £1 stake would return £2.75 which is a profit of £1.75.

Conversion table for some common odds

Odds-on, even-money, or odds-against?

A toss of a fair coin has exactly a 50% chance of landing on Heads or Tails.  The true ("fair") odds for betting on this event would be 2.00 for Heads and 2.00 for Tails.  When the odds are exactly 2.00, this is called even-money.  Essentially, for every £1 you bet, you will win another £1 if you bet wins.

Moving away from the toss-of-a-coin example, not all sporting events are 50:50 events, needless to say.   Let's look a tennis match, where there are also only two possible outcomes;  one player wins, one player loses, there are no draws.  

Sometimes, a tennis match will be as unpredictable as a coin toss, and both players have an exact 50% chance of winning and their true odds would be 2.00.  But this is rare, and most of the time there will be a favourite and an underdog.   

The favourite will always be "odds-on" when there are only two possible outcomes (win or lose). Depending how much the favourite is expected to win, the more of a favourite they become in the betting.  The underdog, or "outsider", will always be "odds-against".  (You can see some of the ranges of odds-on and adds-against in the odds table above.)

The image here shows some of the decimal odds available for the WTA tournament in Miami in 2024.  You can see how most of these matches are quite competitive, with only a few very big favourites.   Coco Gauff is a pretty big favourite at odds of 1.22, which suggests she has about a 82% chance of victory according to the Odds Table above.  

WTA tennis betting odds

Most sports have more than one outcome, as the draw (or tie) is often a factor.  In the England verus Belgium football match England were considered quite healthy odds-on favourites at a price of 1.73.  This means that if we bet £10 on England, we will get a return of £17.30, which is a profit of £7.30.

Decimal Odds for a football match

The same day as this match took place, the Republic of Ireland played Switzerland in what was seen as a much closer match by the bookmakers (also known as sportsbooks). 

Here we can see that the favourite to win the match is Switzerland at odds of 2.20.  Note that they are the favourites, but they are actually "odds-against" because of the close nature of the contest.  In this case, if you bet £10 on the favourites (Switzerland), a winning bet would return £22.00 which is a profit of £12.00.    

Decimal Odds for a closer football match


How does a bookmaker make money?

This article has referred to "true" and "fair" odds on several occasions.  That is because the prices that you will be offered by a bookmaker are, strictly speaking, most of the time, not the "fair" odds that reflect the true chances of the event occurring. 

Let's explain this with the coin toss example, because we absolutely know, with no equivocation, that the true odds of getting Heads (or Tails) is 2.00 (even-money, 50%) when predicting the outcome of a fair coin toss.  But the bookmaker doesn't offer the "fair" price, otherwise they would never be certain about making a profit.  Instead, they offer their customers a price which is slightly worse "value" than the true price.   

Bookmakers offering odds on the Toss of a Coin

In the case of the toss of a coin (which is something you can bet on should you be so inclined), instead of offering 2.00 for either outcome the bookmaker in this case is offering odds of 1.91 for either team to win the toss in an IPL cricket match.

Check the Odds Conversion Table above and we see that odds of 1.91 mean that the bookmaker's odds suggest that there is a 52.4% chance of either side winning the toss, but we know that it is only 50%. It is the practice of offering odds that overestimate the likelihood of an event occurring that ensures that the bookmaker (or casino) wins in the long-run (not if you're a Sharp bettor, however!).   

The idea for the betting companies is that if they take the same amount of total stakes in bets on Team A as for Team B to win this coin toss, they will make a profit regardless of the outcome.  Let's work that through.

For simple maths, assume this bookmaker takes £100 in bets on Team A (Chennai Super Kings) to win this toss at odds of 1.91.   They also take £100 in bets on Team B (Gujarat Titans) to win the coin toss at the same odds of 1.91.  It doesn't matter if Team A wins the toss, or Team B wins.

The bookmaker will payout (£100 x 1.91) = £191 in returns to their customers.  But they have taken £200 in stakes from them.  So overall, they will make a (£200 - £191) = £9 profit on the £200 in betting turnover, whatever the outcome.  For this event then, the bookmaker profit margin is (£9 / £200) = 4.5%.  

You will also hear the term "overround".  Overround is the sum total of all the probabilities on the outcome of an event.   When a fair coin toss offers 2.00 on either Heads or Tails, the overround is (50% + 50%) = 100%, which means the betting company would only break-even in the long-term.  In the case above, with 1.91 odds for both teams, the overround is (52.4% + 52.4%) = 104.8%.   

This is also referred to as a "104.8% book",  used to describe the sum of the prices offered by the bookmaker.  It tells you at a glance how competitive the prices are for the bettor. Ideally, a bettor will seek out betting opportunities where the overround as close to 100% as is possible.  (Note that both sets of odds in the two football matches shown above have a bookmaker "overround" of 115%.)

When the bookmaker has the profit margin and overround on their side, hidden in the odds, it is simply a matter of getting as much turnover as possible, spread as evenly as possible across both outcomes.  That, in a nutshell, is the art of bookmaking.  

Can you beat the bookmakers?

In other words, how does a member of SharpOdds.live make a profit?   

It simply comes down to certainty versus uncertainty.  The bookmakers, like you, know that a coin toss is a true 50:50 event. To offer odds of 1.91 for either side is always going to be a profitable outcome for the bookmaker in the long-term.  That is a fact and it is for certain. 

But in sport, the true probability for a player or team to win a contest is never a fact; there is uncertainty. Coco Gauff might have an 82% chance of winning the tennis match mentioned earlier... but for this particular match it might only be a 75% chance... or is it a 96% chance?  Might she even lose?

The point we are making is that she will win or she will lose, and you may say she is absolutely more likely to win than to lose, but unlike the toss of a coin, no one knows what the true probability really is. This means that odds are sometimes wrong. If you have a system, an "edge", that identifies when betting markets appear to be "wrong", you can beat the bookmakers in the long-run.  

The million-dollar question, and one that most people cannot answer, is:  how do you get an edge?

The SharpOdds.live betting system has been developed by a highly-respected team of seasoned gamblers who have over 50 years of combined experience in building models and deploying them to win money on betting markets. 

Our system doesn't claim to "know" the outcome of any single sporting event. But what it does is isolate opportunities that occur in the betting market-place when it believes there is "positive expected value" being offered by a bookmaker's odds.   

Positive Expected Value; Sharp Betting

Postive Expected Value ("postive EV") is essentially the opposite of the bookmaker overround concept that we introduced above. When you have positive expected value on your side, it is the equivalent of getting odds of 2.1 about the toss of a coin, not the 1.91 that the bookmakers want you to take. 

The SharpOdds.live algorithm has been trained, among other things, to create a probability/prediction about outcomes of sporting events across the globe. 

It is the result of millions of data points, years of historical data, and decades of experience testing the system in the real-world, with real-money, with multiple users of varied levels of expertise.  

The system only highlights betting opportunities that offer the bettor an edge over the bookmaker. If our system thinks the bookmaker has got it "right" (or at least right enough!) it leaves it alone.

To date, our returns are in the region of 10% on turnover based on the 400,000 positive EV betting suggestions that we have made between January 2021 and the time of writing.    

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Other reading

  • Essential betting tools for casual or serious bettors. Click here.
  • View simulations of real-world results for 12-months here.
  • What is the Sharp Stakes method?  Click here
  • Sharp strategies for all levels.  Click here.
  • The Road To £8,000.  Click here.
  • Free tips via email? Click here.

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Don't forget to join our 10,000 followers on X at @SharpBettingGB.  And if you have any questions about this article, you can contact David on X at @dwmh. 

David has been a regular speaker at industry events on the subject of risk management