How to Read Betting Odds: Decimal, American and Implied Probability
By StakeReferralCode.ca Editorial Team · Updated
Betting odds tell you two things: how much a winning bet pays and what chance the bookmaker is pricing in. Decimal odds show the total return per $1 staked (2.50 returns $2.50, including your dollar). American odds show profit on a $100 stake for underdogs (+150) or the stake needed to win $100 on favourites (−200). Implied probability turns any price into a percentage: for decimal odds it's simply 1 ÷ odds.
That's the short version. Below are the formulas, worked conversions and a look at the bookmaker's margin, which is the part most new bettors never check.
A note before you start
This guide explains maths that applies to any sportsbook. If you're thinking of using Stake.com, note that it's not available in Ontario or Alberta. In other provinces it's a legal grey area because Stake.com is licensed in Curaçao, not by your province. Check Stake's terms and your province before depositing.
Decimal odds
Decimal odds are the default in much of Canada and the easiest to work with.
- Total return = stake × decimal odds
- Profit = stake × (decimal odds − 1)
A $10 bet at 2.50 returns $25.00, which is $15.00 profit plus your $10 back. A $10 bet at 1.50 returns $15.00, or $5.00 profit.
Any decimal price below 2.00 means the bookmaker sees that side as the favourite; above 2.00 means underdog. Exactly 2.00 is "even money": you double your stake.
American odds
American (moneyline) odds use a plus or minus sign around a base of 100.
- Positive (+150): the profit on a $100 bet. +150 means a $100 bet wins $150 profit.
- Negative (−200): the amount you must bet to win $100 profit. −200 means you stake $200 to win $100.
For other stakes, scale it:
- Profit at +American = stake × (odds ÷ 100). $10 at +150 = $15 profit.
- Profit at −American = stake × (100 ÷ |odds|). $20 at −200 = $10 profit.
Fractional odds
You'll mostly see fractional odds in UK racing, but the idea is simple: 3/2 means $3 profit for every $2 staked. To convert to decimal, divide and add 1: 3 ÷ 2 + 1 = 2.50.
Converting between formats
American to decimal
- Positive: (American ÷ 100) + 1. +150 → 1.50 + 1 = 2.50
- Negative: (100 ÷ |American|) + 1. −200 → 0.50 + 1 = 1.50
Decimal to American
- If decimal is 2.00 or higher: (decimal − 1) × 100. 2.50 → +150
- If decimal is below 2.00: −100 ÷ (decimal − 1). 1.80 → −100 ÷ 0.80 = −125
Conversion table
| Decimal | American | Fractional | Implied probability |
|---|---|---|---|
| 1.50 | −200 | 1/2 | 66.7% |
| 1.80 | −125 | 4/5 | 55.6% |
| 2.00 | +100 | 1/1 (evens) | 50.0% |
| 2.50 | +150 | 3/2 | 40.0% |
| 3.00 | +200 | 2/1 | 33.3% |
| 5.00 | +400 | 4/1 | 20.0% |
These are standard mathematical conversions, not prices for any real event.
Implied probability
Implied probability is the chance of an outcome that the odds suggest.
- Decimal: 1 ÷ decimal odds. 1 ÷ 2.50 = 0.40, or 40%.
- Positive American: 100 ÷ (odds + 100). +150 → 100 ÷ 250 = 40%.
- Negative American: |odds| ÷ (|odds| + 100). −200 → 200 ÷ 300 = 66.7%.
Why it matters: a price only makes sense compared with your own estimate of the chance. If you believe an outcome happens about 40% of the time and the odds are 2.50 (40% implied), the bet is roughly break-even before the bookmaker's margin. Paying a price that implies a higher chance than you believe in is overpaying.
The bookmaker's margin (the overround)
Add up the implied probabilities for every outcome in a market and you'll get more than 100%. The extra is the bookmaker's built-in margin.
Worked example: a two-way market
Imagine a hypothetical over/under line where both sides are priced at 1.91.
- 1 ÷ 1.91 = 52.36% for each side
- 52.36% + 52.36% = 104.71%
The 4.71% above 100% is the margin. To estimate the "fair" probability without the margin, divide each side by the total: 52.36 ÷ 104.71 = 50% each. At truly fair odds, both sides would be 2.00, but you're being paid 1.91.
Worked example: a hockey moneyline
Say a hypothetical Maple Leafs vs Canadiens game is priced Maple Leafs 2.20, Canadiens 1.70 (overtime included, so only two outcomes). These numbers are made up purely to show the maths.
| Team | Decimal odds | Implied probability | Margin-free estimate |
|---|---|---|---|
| Maple Leafs | 2.20 | 1 ÷ 2.20 = 45.45% | 45.45 ÷ 104.27 = 43.6% |
| Canadiens | 1.70 | 1 ÷ 1.70 = 58.82% | 58.82 ÷ 104.27 = 56.4% |
| Total | 104.27% | 100% |
The book total of 104.27% tells you this market has a margin of about 4.3%. Margins differ between markets and between bookmakers, which is why comparing prices (line shopping) matters. Props and parlays often carry bigger margins than main lines.
Practical tips for using odds
- Pick one format and stick with it. Switching between decimal and American mid-session is where mistakes happen.
- Always check the return on the bet slip. It's the fastest way to catch a misread price.
- Convert to implied probability before betting. It turns "2.75 looks big" into "this needs to happen more than 36% of the time".
- Compare prices. The same outcome can be priced differently in different places. A small difference adds up over many bets.
- Remember the margin compounds. In a parlay, each leg's margin multiplies. Our parlay guide shows how fast that grows.
- Odds aren't predictions. They're a price that balances the bookmaker's view, the money coming in and the margin. A favourite at 1.50 still loses about a third of the time by its own implied probability.
FAQ
What do the plus and minus signs in odds mean?
A plus sign (+150) shows the profit on a $100 bet and marks an underdog. A minus sign (−200) shows how much you'd need to bet to win $100 and marks a favourite.
Do decimal odds include my stake?
Yes. Decimal odds show the total return, stake included. Subtract 1 and multiply by your stake to get the profit alone.
What are "even money" odds?
Decimal 2.00, American +100 or fractional 1/1. You win the same amount you stake, and the implied probability is 50%.
Why do implied probabilities add up to more than 100%?
Because of the bookmaker's margin. The extra percentage is how the book makes money over time, whichever side wins.
Can I change the odds format on Stake?
Yes, the odds display can be changed in your settings, so you can view prices in decimal or American.
Conclusion
Reading odds comes down to three habits: know what the number pays, convert it to an implied probability, and remember the margin built into every market. Once those are automatic, you'll make fewer slip-up bets and see prices more clearly. If you're in an eligible province and want to see these formats on a live sportsbook, our Stake sportsbook guide explains how it works, and you can register with code SHIMA through the Claim button on this page.
Related Guides
- Ready to sign up? Start with the Stake referral code SHIMA for Canada.
- Puck Line, Spreads and Totals Explained (Examples)
- Parlay Betting Explained: How Parlays Pay and Risks
- Sports Betting Bankroll Management: Simple Rules
- All Stake guides for Canada
Play responsibly. Set deposit and loss limits in your Stake account settings, and use cooling-off or self-exclusion if you need a break. If gambling is causing problems, free confidential help is available in every province. For example, BC: 1-888-795-6111, Quebec: 1-800-461-0140, Manitoba: 1-800-463-1554. See our responsible gambling page for every provincial helpline and support organisation.
19+ (18+ in AB, MB, QC). Not available in Ontario or Alberta. Gambling can be addictive – play responsibly.