Bookmakers in the United Kingdom (and Ireland) usually quote prices using fractional odds (i.e. 5/1, 1/2, etc). Fractional odds show how much the bettor can profit, relative to their stake, IF their bet wins. In this article ‘Betting: Fractional Odds Explained’ we explain everything you will need to know about fractional odds.
- Fractional odds show the payoff:stake ratio. The left hand number of the fractional odds is the amount of profit you will make IF your bet wins (PAYOFF), and the right hand number is the amount you will have to gamble (STAKE). IF your bet loses, you forfeit the stake. If your bet wins, you get your stake back AND the payoff.
- 5/1 odds mean that if you bet £1, you will make £5 profit if your bet wins (i.e. if your bet wins the bookmaker will return you original stake of £1 AND pay you £5 profit). Remember, the odds just show a ratio – you don’t have to bet exactly £1. If you bet £2, you make £10 profit if your bet wins. If you bet £60, you make £300 profit if your bet wins.
- 1/2 means if you bet £2 you will make £1 profit if your bet wins (i.e. if your bet wins the bookmaker will return you original stake of £2 AND pay you £1 profit). This is an example of an odds-on price (the possible profit is less than the stake – however, you would not lose any money if your bet wins, as you would get your stake back. If you bet £10, you make £5 profit if your bet wins. If you bet £200, you make £100 profit if your bet wins).
- Another way of looking at this is the fractional odds show the ratio of the amounts gambled by the two parties involved (the bookmaker, and the bettor). Suppose Sun Bets offers 5/1 on a horse winning a race, and a bettor decide to place a £1 bet on that horse, you could look at it as the bookmaker puts in £5 into an envelope & the bettor puts in £1 into the same envelope – so there is £6 in the envelope. If the bettor wins the bet (i.e. the horse wins), he gets to keep all the contents of the envelope. If the bettor loses the bet (i.e. the horse doesn’t win), the bookmaker gets to keep all the contents of the envelope.
The fractional odds system makes it easy to see how much profit could be made, relative to the stake. Both the numerator and denominator are expressed as whole numbers. However, as odds are sometimes expressed using different denominators it may take a while to compare odds, e.g. 5/2, 7/4, 3/1. Other systems include the decimal odds system, which is particularly useful to calculate accumulator returns quickly (although we recommend you stay away from accumulators). We hope you learnt a thing or two from our Betting: Fractional Odds Explained article!