The odds of a certain sports outcome can be complicated to understand, especially if you’re not used to comparing them to other events. In most sports, the term “odds” refers to the amount of money you must wager to earn a single unit of Profit (i.e. $10 gets you $1 in Profit). To make the concept a bit clearer, let’s say you’re playing the World Cup — you may have heard of it — and you put $100 on France to win. The initial stake ($100) would create the following odds:
- France 1x
- Germany 2x
- Belgium 3x
- England 4x
- Brazil 5x
- Argentina 6x
- Colombia 7x
- Costa Rica 8x
- Japan 9x
As you can see, by placing a $100 wager on France to win the World Cup, you’re setting up an event with the following odds:
- The chances of France winning 1x is 1/1 (100%.)
- The chances of Germany winning 2x is (1/1 x 1/1) (50%.)
- The chances of Belgium winning 3x is (1/1 x 1/1 x 1/1) (33%.)
- The chances of England winning 4x is (1/1 x 1/1 x 1/1 x 1/1) (25%.)
- The chances of Brazil winning 5x is (1/1 x 1/1 x 1/1 x 1/1 x 1/1) (20%.)
- The chances of Argentina winning 6x is (1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1) (15%.)
- The chances of Colombia winning 7x is (1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1) (12%.)
- The chances of Costa Rica winning 8x is (1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1) (9%.)
- The chances of Japan winning 9x is (1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1 x 1/1) (7%.)
In this example, the chances of any of the nine teams winning are all equal. You don’t need to look at the odds of each game to know the outcome of the World Cup — it’s simply a matter of which team you think will come out on top. Other sports, like American football, consider a touchdown to be the equivalent of a win, so you wouldn’t need to set up any wagers for that game. You would simply need to know the odds of each touchdown against the opposing team.
As you may have guessed, there are several different ways to phrase “odds.” The most basic form is “against,” as in “Argentina vs. Belgium.” That’s shorthand for “the odds of Argentina winning are (1/1) and the odds of Belgium winning are (1/1).”
Another widely used form is “for,” as in “France for World Cup victory.” That creates the following odds:
- France 1x
- World Cup victory 2x
As before, the chances of France winning are equal to the chances of World Cup victory. Remember, in the shorthand format, “for” means the event is for the winnings of that game. So in this case, if France wins, you would win $2. Other forms of odds, like “to,” are used when there’s a specific dollar amount on the line. So you might put a $100 wager on France to win the World Cup, but there’s a cap on how much you can win. In that case, you’d use the “to” option, as in “France to win the World Cup,” which sets up the following odds:
- France 1x
- World Cup victory to 100x
Again, in this case, France has the same odds of winning the World Cup as the next closest team. It would be like if you were playing a game of craps and you rolled 18. You would win $18, no matter what team you were playing against.
How Does This Relate to Bookmaking?
In some ways, betting is easier to understand when you compare it to bookmaking. In bookmaking, the term “line” refers to the amount of money you must wager to win a certain amount of money. Lines are typically established for each game or event, and the odds are then applied to their total. For example, the line for the Super Bowl is usually set at 50/1, which means you have to wager $100 to win $1. Any winning amount would then be collected as a commission.
With a bookmaker, you would need to place a bet on each game to see the full benefit of the line. If you bet on two games, you would win twice, but you would also have to pay out on the other two bets. You can’t simply “play the World Cup” because there’s no payout for that particular event. You would need to set up four separate wagers: one each for France, Germany, England, and Brazil (or whichever four teams you felt were the most likely to win).
This concept is easier to understand with an example. Let’s say you’re playing the World Cup and you establish a €50 line on Germany to win. That means you must wager €50 to win €1 (1/50 of the line). The four games you’ve chosen would be:
In this case, your winnings from the Germany game would be €25 (1/50 of the line) and the other three would be €25 (1/50 of the line). You would earn a total of €100 (4/50 of the line), which you would need to pay out of your own pocket in the form of a €25 “commission” on each of the other three games.
An important point to make is that in most cases you need to put up at least some of the money you win as a commission. For example, if you wager €25 on Germany to win the World Cup, you need to put up €5 as a commission — which amounts to a 20% “takeout” on your original wager. If you’re going to play the World Cup and you don’t want to deal with the commission costs (and who doesn’t?), you can work with a bookmaker who will take care of those costs for you.
The Difference Between Bookmakers And Hedgers
There is one more important difference between bookmakers and hedgers. In most cases, a bookmaker will take your wager and run with it. That is, he will “front” you the money you need to lay down as a base bet and then he will match you bet to bet on the outcome of the game. So if you bet €100 on Germany to win the World Cup, your bookmaker will take that bet and extend it to €200 (2/1). Then he will match you €100 bet to €100 on England to win. In this case, there is no effective “line” change because you are simply repeating the original wager. The key point is that a bookmaker will take your wager and extend it to cover as many games as possible, whereas a hedger will take your wager and use it to settle the outcome of a single game. To put it another way, a bookmaker will take your average bet and move it up or down based on the likelihood of an event occurring.
In the case of the Super Bowl, if you were writing down the results of the game as it happened, you might record as follows: