Fractional odds show the profit relative to the stake: 5/1 means £5 profit for every £1 staked, and the stake is returned as well. To convert them to decimal odds, add 1 to the fraction, so 5/1 becomes 6.0, and the implied probability is 1 divided by that decimal figure, or about 16.7 per cent.
Reading fractional odds
Fractional odds express the profit a bet would make, not the total return, and many readers mistake the profit-only figure for the total. A £10 bet at 5/1 returns £60, which includes the £50 profit and the £10 stake. The top number is the profit and the bottom number is the stake it relates to, so the same logic works at any stake: multiply the stake by the fraction to find the profit, then add the stake back to find the total return.
Odds-on prices work the other way round, with a profit smaller than the stake. A price of 1/2 means £1 profit for every £2 staked, so £2 wagered returns £3: the £1 profit and the £2 stake. Evens is 1/1, where the profit matches the stake, so £1 at evens returns £2.
Converting to decimal odds and probability
Decimal odds include the stake in the figure, which makes them the most direct way to compare prices. To convert fractional odds to decimal odds:
- Divide the top number by the bottom number.
- Add 1.
So 5/1 becomes 6.0, 1/2 becomes 1.5 and evens becomes 2.0. Multiplying the stake by the decimal odds gives the total return, so £10 at 6.0 returns £60, exactly the same as £10 at 5/1.
The implied probability is the reciprocal of the decimal odds: 1 divided by the decimal price. Decimal 2.0 gives 1 divided by 2, or 50 per cent. Decimal 6.0 gives 1 divided by 6, or about 16.7 per cent. The shorter the price, the higher the chance it implies, which is why odds-on prices point to favourites.
Understanding the bookmaker's margin
Across all the outcomes of a market, the implied probabilities add up to more than 100 per cent. The excess is the bookmaker's margin, sometimes called the overround, and it is how betting operators make money. It means every price on offer is a little shorter than a fair price would be, so the odds already tilt in the bookmaker's favour before any bet is placed.
Converting a price into its implied probability is a practical way to read it. It shows the chance the price suggests, not the chance that the outcome will actually happen, and it makes it easier to see how much margin sits inside a market. Adding up the implied probabilities of every outcome and comparing the total with 100 per cent shows the size of that margin, and working in decimal odds makes the sums much simpler than working with fractions.
Gambling is for adults 18 and over and always costs money; UK players can set deposit limits, use GAMSTOP or call the National Gambling Helpline on 0808 8020 133.
