Understanding the basics of sports betting is essential to being able to profit with hedged (or matched) betting. If you're new to the sports betting market, it can be a lot of information to process at once. We'll be going over the basics in the next few guides, if you're a more advanced user and already know all about wagering, feel free to skip ahead. 

Essentials: What are odds?

You may have read or heard about sports odds. They are ways to indicate how likely a certain proposition or side is to win, which affects the amount you are paid. For example, if everybody knows that the Chicago Bears (favorites) will beat the Green Bay Packers (underdogs) then the payout for betting on the Packers should be higher. 

Another keyword is the stake, which is the amount you bet on a certain proposition. If your bet wins, you get the stake back and then any profit. The profit is determined by what the odds are.

A sportsbook's job is to determine what specific odds each side, player, or proposition should have. The idea is that based on general consensus and feel for who's likely to win, you'll get equal expected value from either side. The odds for a side are also referred to as the line. 

For matched betting, we don't really care who wins, but we do care about how much you get paid. Our algorithm finds the best value for each side across different sportsbooks, so that your payout is the highest in either case. You need to understand what these lines mean in order to be an educated matched bettor.

There are different ways that odds are expressed, we'll go over the three most popular.

Reading American Odds

In typical fashion, the US measures our betting odds differently than the rest of the world. They are represented with either a plus or minus, indicating if the side is favored to win (favorites) or lose (underdogs). 

  • Favorites: denoted by a (-) sign. The number that follows is how much you would have to bet in order to profit 100 if this side wins. Example: Chicago Bears -500. That means you would have to wager $500 on the Bears in order to profit $100.
  • Underdogs: denoted by a (+) sign. The number that follows is how much you would profit by wagering $100 on this side. Example: Green Bay Packers +400. That means you would win $400 from betting $100 on the Packers if they won.

You may notice that our example had the Bears as -500 favorites and the Packers as +400 underdogs. Logically, the Packers should be +500, but in most cases the lines are not set like this. The difference is called the vig, and is a way for sportsbook to extract some value out of the exchange. It's essentially their cut for hosting the bet, and is actually why sports betting is rigged in the long term! Matched Betting does not fall victim to this, as we are using the house's promotions to take value for ourselves. 

Reading Decimal Odds

Decimal odds are popular in Europe, Australia, New Zealand, and Canada. They are slightly more intuitive - they are a decimal that represents how much you will be given back if your bet wins. You multiply the decimal by how much you bet (the stake), and that's what you will receive.

  • Favorites: will be <2.0 Example: Chicago Bears 1.2. For every $1 you bet on the Bears you will receive 1.2 if you win.
  • Underdogs: will be >=2.0. Example: Green Bay Packer: 5.0. For every $1 you bet on the Packers you will receive 5.0 if you win. Remember, this includes the stake!

If you are one of our users from the US, you shouldn't have to worry about encountering this too much. However, decimal odds is easier to understand.

Fractional Odds

Fractional odds, also known as British odds, are popular in the UK and Ireland. Typically they are written with a slash (/) or a hypthen (-). The first number indicates the amount you will win if the bet hits (just the profit), the second number is the stake or amount you have to put in to win that much. These numbers scale proportionally as well.

  • Favorites: payout is less than the stake, so the first number is smaller. Example: Chicago Bears 1/5. For every $5 you bet on the Bears, you will only be given $1 back for winning.
  • Underdogs: payout is more than the stake, so the first number is larger. Example: Green Bay Packers 4/1. For every $1 you bet on the Packers, you will be given back $4 if you win.

Implied Odds

This isn't any odds you will see on a sportsbook, because it is difficult to derive the payout from this. Implied odds are the chance of a side winning expressed as a percentage. This is the probability that are implied from the lines that sportsbooks set. There are two different formulas for converting American Odds into implied odds.

  • Favorites: P = O / (O + 100) * 100. Bears -500 would then be a 83.33% chance of them winning.
  • Underdogs: P = 100 / (O + 100) * 100. Packers +400 would then be a 20% chance of them winning.

Implied odds aren't quite as important for matched betting as other kinds, because it literally does not matter who wins, our equations pre-determine the same amount of profit if either side comes out on top.