All Sports Betting Basics You Should Know
Probability and Odds
You can’t really make much money out of sports betting unless you know the clear difference between the probability and odds. Even though both these are closely related to each other, odds don’t directly reflect the probability of an event happening or not happening.
To tell you the truth, probability in the field of sports is mostly subjective in nature.
You can come across various opinions about the possible outcome of any given sports event. While one person may give a football team a 60% chance of winning, another may refuse to go over 45%. Being successful in sports betting is a lot about making precise assessments about the chances of different outcomes, and then figuring out if it’ll be worthwhile to make a wager on them. You can’t possibly make that decision without properly understanding the concept of implied probability.
What’s meant by implied probability?
Implied probability, in the field of sports betting, refers to the chances of a particular outcome as suggested by the odds. It helps in calculating the bookmaker’s advantage. Most importantly, it helps in determination of the fact whether a wager is worth enough getting involved in or not.
It makes sense to place a wager only when you expect some value from it. And value always exists if the odds of a particular outcome are higher than they normally should be. It’s implied probability that shows us the exact picture.
Let’s explain this to you with the help of a tennis match example. Imagine it’s a match between Roger Federer and Rafael Nadal. Considering they’re playing on grass, bookmakers are giving both players exact chances of winning. Hence, the odds are priced at 2.00 for both the players. A bookmaker would normally never set such odds, but we’ll assume that he has done it in this case.
These odds suggest that both players have a 50% chance of winning, just like in case of a coin flip. This 50% is what’s known as implied probability. The actual formula for conversion of decimal odds into implied probability is:
Implied probability = 1 / Decimal odds
The result of the above formula will be a number between 0 and 1, as should be the case with probability.
So, in case of the above example, the implied probability would be 1 / 2.00 = 0.50, that is, 50%.
However, if each player indeed had a 50% chance of winning, there may be no sense in placing a wager on either of them. That way, you’ll get a 50% chance of losing your stake and 50% chance of making it double.
On the other hand, if you think that Rafa has a higher 60% chance of beating Roger, as you’ve been following his form closely, it may make more sense for you to bet on Rafa. If your prediction is correct, you stand a 60% chance of doubling your stake and 40% chance of losing it.
So, to conclude, odds merely tell us about the implied probability of an outcome to happen. We can say that we’ve found some value if we believe that the actual probability of a certain outcome is higher than its implied probability. Finding such value is the key to achieving success in sports betting.