Example of decimal odds
With decimal odds of 5, for instance, £5 will be paid out for a winning bet of £1. This is the original stake of £1 plus winnings of £4. Decimal odds of 5 are the same as the fractional odds of 4/1.
Popularity of decimal odds
Decimal odds are the second most popular odds format used by online bookmakers in the UK, after fractional odds. They’re also referred to as continental or European odds due to their popularity in Europe.
Unlike fractional odds, decimal odds don’t have a direct relationship to the mathematical odds that are used to express relative probability, and can’t be converted directly into probability estimates. This is because decimal odds include two adjustments to true probability odds. They’re adjusted downwards by bookmakers to create their profit margins, and they’re adjusted to include the return of your stake when used in betting calculations.
If you’re new to betting, it’s important not to make the mistake of thinking that decimal odds are more favourable than equivalent fractional odds because they factor in the return of your stake. Decimal odds are always presented in decimal format and may have no, one, or two decimal places. Examples are 4, 3.6 and 5.25.
Calculating bet returns using decimal odds
Using decimal odds is straightforward. Simply take the amount that you want to stake and multiply it by the decimal value that’s quoted. The result will be the total payout you receive for a successful bet, including both your winnings and the stake you bet. The total return from a decimal odds bet can be expressed as follows: Stake x Decimal odds = Total return
As an example, say you bet £100 on Manchester City winning the League Cup at decimal odds of 5.0. This means that if you win the bet, the total return you’ll get is 100 x 5.0, or £500. This includes the £100 stake you wagered and £400 in winnings.
Why use decimal odds?
Decimal odds aren’t often used or quoted when betting prices are discussed in the UK or Irish press. Although fractional odds give a clearer idea of the probability estimates made by bookies, decimal odds have certain advantages:
- they’re easier to read and understand because they don’t require the use of fractions
- they’re easier to use when you’re trading at betting exchanges because they allow for easier price comparisons
- it’s easier to use decimal odds to calculate the overall odds from multiple bets – you simply multiply the odds for the individual bets to arrive at the final odds.