The implied probability calculator converts betting odds into percentages, revealing the likelihood of an event occurring according to the bookmakers’ odds.
Think of it as decoding the hidden message within betting odds. When bookmakers set odds, they’re essentially expressing their view of an event’s likelihood, plus their profit margin (known as the vig or juice). The implied probability calculator strips away this margin to reveal the true probabilistic expectations.
If a tennis player has odds of 2.00 (in decimal format) to win a match, the implied probability calculator would reveal a 50% chance of victory. This means the bookmakers view this as essentially a coin flip, with equal chances for either outcome.
Implied Probability Calculator
| Event Type | Odds Format | Given Odds | Implied Probability | Interpretation |
|---|---|---|---|---|
| Soccer Win | Decimal | 2.50 | 40% | Underdog team |
| Horse Race | Fractional | 3/1 | 25% | Long shot |
| NBA Game | American | -200 | 66.67% | Clear favorite |
| Tennis Match | Decimal | 1.33 | 75.19% | Strong favorite |
| NFL Spread | American | +150 | 40% | Slight underdog |
Implied Probability Calculation Formula
Here are the three main formulas:
For Decimal Odds:
Implied Probability = (1 / Decimal Odds) × 100For American Odds:
For positive odds:
Implied Probability = (100 / (American Odds + 100)) × 100For negative odds:
Implied Probability = (|American Odds| / (|American Odds| + 100)) × 100For Fractional Odds:
Implied Probability = (Denominator / (Numerator + Denominator)) × 100The formula for calculating implied probability varies depending on the type of odds format you’re working with.
Let’s calculate the implied probability for decimal odds of 1.75:
Implied Probability = (1 / 1.75) × 100 = 57.14%This means the bookmakers believe there’s a 57.14% chance of this outcome occurring.
How to Calculate Implied Probability?
Let’s break it down into steps:
- Identify the odds format (decimal, American, or fractional)
- Convert odds if necessary (to decimal format for easier calculation)
- Apply the appropriate formula
- Convert the result to a percentage
- Account for the bookmaker’s margin if needed
Let’s calculate the implied probability for American odds of -150:
- We have negative American odds, so we’ll use the negative odds formula.
- |-150| = 150 (remove the negative sign).
- Implied Probability = (150 / (150 + 100)) × 100.
- = (150 / 250) × 100.
- = 0.6 × 100.
- = 60%.
Soccer Win (Decimal odds of 2.50)
- Using (1 / 2.50) × 100 = 40%
- This suggests the team has a 40% chance of winning.
Horse Race (Fractional odds of 3/1)
- Using (1 / (3 + 1)) × 100 = 25%
- Indicates a 25% chance of victory.
NBA Game (American odds of -200)
- Using (200 / (200 + 100)) × 100 = 66.67%
- Shows a strong favorite with about two-thirds probability of winning.
References:
- Journal of Gambling Studies – “Understanding Betting Odds and Probability” – https://link.springer.com/journal/10899
- American Statistical Association – “Probability in Sports Betting” – https://www.amstat.org
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