There is no sports betting without odds, everyone knows that – but what exactly makes the odds turn out the way they do in the end? How can you calculate an odds? And above all: What do the odds mean for your own bet? Does it possibly give a hint on who or what is better to bet on? Or does it simply indicate the risk and potential profit, without being a guide? All these questions will now be answered here.
What do sports betting odds depend on?
In sports betting, odds always reflect in a specific way the probability of a certain event occurring. The less likely something is, the greater the chances of it happening. In this case, the odds are determined on the basis of a fair percentage, which only takes into account the probability of winning. In addition to the probability, the odds also include the bookmaker’s profit margin and the German betting tax of 5%. So the odds in Germany are always slightly worse than elsewhere, which means lower profits for the players. For this reason, many players prefer to place their bets with non-German providers, who may accept a lower profit margin and where they may also avoid betting tax.
Who determines the odds?
Not every bookmaker calculates the odds for their bets themselves. This is done by some large online providers, which you can find out about at www.wettanbietererfahrungen.com, for example, as well as by large physical providers, e.g. in horse racing, but many smaller providers buy the current odds from larger providers. The odds themselves are either calculated by the computer with the help of complex algorithms or a professional sports betting bookmaker determines an ideal odds.
How are odds calculated for sports betting?
The odds for sports betting are always calculated in a multi-step process. First, the sporting event is analyzed. Then, a fair quota is determined, which becomes the real quota by including further costs. In practice, however, the odds are constantly changing if the bets of the players are also taken into account.
Step: Analysis of the sporting event
On the way to a sports betting quota, the first step is always a sober analysis of the sporting event. Statistics for similar events in the past are used, but also, for example, the daily form of the athletes is taken into account. In addition, however, countless other details can find their way into the analysis. Ultimately, it helps the bookmaker who is going to determine the odds, of course, a lot if he can get back to as much relevant data as possible. At the end of this analysis, the bookmaker makes assumptions about the probability of the event occurring. For example, in a football match, he may conclude that 45% of the time team A will win, 20% of the time team B will win and the match will end in a draw with a probability of 35%.
Step: Determining fair odds
From the odds for specific outcomes, the bookmaker can now easily derive a fair odds. To do this, he divides 100 by the probability of a specific event occurring. In the example above, the odds for a win by team A would be 2.22. The odds for a win by team B would be 5, and the odds for a draw would be 2.86.
Step: Calculating a real return
However, a fair return is not enough – here the bookmaker has not yet made a profit and cannot pay the betting tax. To fulfil these two purposes, the bookmaker calculates a real return. To do this, he first looks at the percentage of bets he would like to reserve as his profit. Let’s assume that the profit should be three percent. If the betting tax of five percent is added to this and the sum of both contributions is subtracted from 1, the result is that the players can pay out 92 percent of their winnings.
To price this directly to customers, the bookmaker now multiplies the fair odds by the player share. The odds of Team A winning now change from 2.22 to 2.04 and the odds of Team B winning drop from 5 to 4.6. In addition, the odds of a draw drop from 2.86 to 2.63.
Be careful!
However, you should be careful with the actual odds, because not all providers include betting tax directly. So, a better odds at first glance may ultimately yield a lower profit than a seemingly worse odds. However, you can learn more about the calculation of actual odds and the inclusion of betting tax in the general terms and conditions or on a special explanation page of the bookmaker.
Continuous adjustment of probabilities
In fact, the odds for various betting events are constantly adjusted. This is done in relation to how many players bet how much money on a particular outcome. The adjustment of the odds is done in the interest of the bettor in such a way that he can close a profit in the end with the greatest possible probability. However, this is not always possible, so it may happen that a bookmaker has to accept losses. However, with all the dynamic adjustment of the odds, it is still important for the bookmaker to maintain the relationship between the different odds for the outcome of an event.
Differences between probabilities
Different bookmakers also offer different odds to their customers – even if it’s the same event. This may be because they value the event differently, but it could also be because they have simply set different profit margins. Customers may initially only be marginally interested in the small differences between the odds across different bookmakers. However, even on a single bet, this can lead to large differences in potential winnings and over a longer period of time, large differences can also arise.
An example calculation for a combination bet can make this clear. If you bet 100 euros each with two bookmakers, but one offers odds of 1.96 and the other 1.94, the differences are immediately greater. In the case of correct advice, the bookmaker with odds of 1.96 ultimately gives you a profit of 2892.55 euros, while the bookmaker with odds of 1.94 can only pay out a profit of 2747.95 euros. So a small difference in the second decimal place already reduces the profit by almost 150 euros.
Importance of probabilities
Anyone who has already dealt with sports betting for a while will quickly realize that it has a very decisive influence on the success of the bet. Bets do not affect whether you can ultimately collect a profit or not, but they have a very good influence on how high the profit will be in the end. Especially if you bet more often or with larger amounts, the profit often melts away noticeably due to bad odds.
Therefore, it is definitely worth checking out the best odds on various portals. Here, however, it is not necessarily the case that a bookmaker who once has the best odds on offer can always offer them. After all, the odds change with each sporting event and with different estimates and different betting behavior of users, they can vary greatly under certain circumstances. The best thing to do is to look for the provider that offers the best odds to customers in this case for each bet you want to place.