Understanding Betting Odds: A Simple Guide for South African Bettors

If you are new to betting on sport, you definitely need to understand betting odds; it’s one of the most important things you need to learn about before placing bets. Odds will give you an idea about how much a winning bet will return, while also giving you a clue of how likely your bet is to win.

In South Africa, online betting sites use decimal odds. It’s quite easy to understand when you know how it works. For example, odds of 2.50 mean that every R1 staked returns R2.50 if your bet wins.

However, there is more to betting odds than just choosing the best-looking number. In this Understanding Betting Odds guide, we’ll explain how betting odds work, how to work out your returns, what implied probability means, and why odds can change before an event gets started.

What Are Betting Odds?

Betting odds show what you can get from your bet if it wins and also what the sportsbook thinks could possibly happen in the match or event.

For example, imagine Liverpool are playing a soccer match and show decimal odds of 2.50 to win. If you place a R100 bet, and Liverpool ends up winning, your total return would be R250.

Importantly, that R250 includes your original R100 stake (your stake is the amount that you bet). Therefore, your actual profit would be R150.

Let’s recap:

• Odds for the bet: 2.50

• Your bet amount (stake): R100

• Total winnings from the bet: R250

• Your profit: R150

As you can see, the amount that you win includes your original amount for the bet.

Therefore, the higher the decimal odds, the bigger your winnings can be, but as the decimal number increases, it also shows that the outcome is less likely to happen. 

Understanding Betting Odds: How Decimal Odds Work

Decimal odds are the easiest format because it shows the total return for every rand that you have placed on a bet.

This is the basic formula: Your return is equal to the amount that you bet, multiplied by the decimal odds.

So, for instance, odds of 1.50 mean a R100 bet will return R150. Odds of 2.00 will return R200, and odds of 5.00 would return R500.

Let’s look at the formula:

• Your stake x decimal odds = your return

So, if you place a bet of R100 at odds of 2.50:

• R100 (your stake) x 2.50 (decimal odds) = R250

To calculate your profit, you will need to subtract your stake from the bet.

• R250 – R100 = R150 profit

How to Calculate a Potential Betting Return

To calculate betting returns, you need to understand the basic formula.

Suppose you place R250 on a tennis player at decimal odds of 1.80.

R250 x 1.80 = R450

Your total potential return is therefore R450. Because that amount includes your R250 stake, you will make a profit of R200.

There are three terms that are often confusing for those who are new to sports betting. However, they mean different things.

1). Your stake is the amount of money you place on a bet. If you wager R100, your stake is R100.

2). Your return is the total amount you receive if your bet wins. At odds of 2.50, a R100 stake produces a R250 return.

3). Your profit is the amount you keep after subtracting your original stake. In the example from above, the profit will be R150.

What Does Implied Probability Mean?

You can also convert betting odds into an estimated probability, which represents the sportsbook’s view of an outcome as a percentage. This percentage is known as implied probability.

With decimal odds, the basic calculation is:

1 ÷ decimal odds x 100 = Implied probability

For example, odds of 2.50 give:

1 ÷ 2.50 x 100 = 40%

Therefore, odds of 2.50 show a probability of 40% for the outcome to actually happen.

Similarly, odds of 1.50 imply approximately 66.7%, while odds of 5.00 imply 20%.

However, this does not mean the sportsbook is saying an outcome has exactly that chance of happening. This is their interpretation of what could possibly happen, with their profit margin built in.

Consequently, implied probability should be seen as a useful way to make sense of odds rather than a guaranteed prediction.

Fractional and American Odds

Although South African betting sites use decimal odds, you might encounter other formats when reading international betting content.

The U.K traditionally uses fractional odds. Odds of 3/2 mean that a successful R100 bet would generate R150 profit, plus your original R100 stake.

The USA uses American odds, or moneyline odds. They are usually displayed as positive or negative numbers. Positive odds show the potential profit from a standard R100 stake, while negative odds show the amount you need to stake to make R100 profit.

Fortunately, South Africa keeps it simple; if you are betting in SA, decimal odds will be the format to focus on.

How and Why Sportsbooks Set and Adjust Odds

Sportsbooks use a combination of statistics, historical data, market info, and trading experience to set their odds.

With a soccer match, for example, factors will include recent form, injuries, home advantage, changing weather, player availability, and previous performances, to name a few.

Nevertheless, odds are not fixed predictions. Instead, they can change as new information becomes available and as money enters the market.

What Does a Movement in Odds Show Us?

Betting odds can change between the time a market opens and the start of an event.

For example, a soccer team could at first be set at 2.50 before changing to 2.20. This means the potential return has decreased.

Conversely, odds might drift from 2.50 to 2.80, increasing the potential return.

A change in odds happens for many reasons. For instance, an important player could leave the lineup, changing weather conditions could affect the event, or increased betting activity could move the market.

Thus, a change in odds pricing shouldn’t always be interpreted as a winning or losing signal. A big change in odds could, however, give a good indication of a newly discovered factor which could influence the outcome of the match.

Understanding Favourites and Outsiders

A favourite is the team or competitor with the lowest decimal odds number. The lowest number in a market is considered the favourite and the most likely winner.

For example, a rugby team priced at 1.40 is a much stronger favourite than a team priced at 3.50. The outsider, meanwhile, has higher odds and is considered less likely to win.

However, being the favourite doesn’t always guarantee a victory. In fact, even a strong favourite can lose, this is why understanding the relationship between risk and potential reward is so important.

Why the Highest Odds Do Not Always Represent Value

It can be tempting to choose the highest odds because it offers the biggest profit. Nevertheless, higher odds don’t always mean better value.

Imagine one sportsbook offers 2.40 on an outcome while another offers 2.50. The second price provides a higher profit for the same stake. However, the most important question is if the odds are a good option compared with your view of what might happen.

For example, you can check the available sports betting markets at sites such as Betway, Hollywoodbets, Mzansibet or PantherBet to mention a few and compare the odds for the same outcome before placing your bet.

This is where value in betting is important. For example, if you believe something has a 50% chance of winning, but the available odds show a 40% probability, that would provide some value for your bet.

Ultimately, betting shouldn’t be about finding the biggest number. Instead, you should understand the odds, probability, and risk involved.

Additionally, our guide on how to choose the best online sports betting sites in South Africa helps you assess odds, payment options and other key features before choosing a bookmaker.

Common Mistakes When Reading Betting Odds

Beginners can make some easily avoidable mistakes with betting odds.

Confusing return with profit: A R100 bet at 2.50 returns R250, but the profit is only R150.

Thinking favourites can’t lose: Low odds show a higher probability, not a guaranteed result.

Chasing high odds: Bigger returns come with bigger risk.

Ignoring odds changes: Prices can change a lot before an event starts, so checking the current odds is important.

Misunderstanding implied probability: The probability percentage from odds is an indication, not a guarantee. These are some of the simple mistakes beginners can make. Avoiding them could save you a great deal of heartache later on.

Understanding Betting Odds: The Bottom Line

Having the betting odds explained is one of the most important things in sports betting and understanding is vital. Once you have a clear idea of the potential risks and returns, your betting success rate is bound to improve. Instead of taking a guess when placing a bet on sport, your betting choices will become much more informed.

Luckily for South Africans, the decimal odds system makes it easy. When you know how to calculate a potential return, subtract your stake from your total return to calculate profit, and check the implied probability, you will never see betting odds as a foreign language again.

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