# Explaining American odds, fractional odds, and decimal odds

You may have noticed there are several different ways to display the odds offered by any given betting proposition.

Depending on whether you’re coming from the world of sports betting or horse betting, you might scratch your head when seeing odds listed as “-200,” “5-2,” or “3.80-1.”

How do they all compare?

Let’s cut through the confusion and explore the difference between three different methods of displaying betting odds — American odds, fractional odds, and decimal odds.

## American odds

Widely used in sports betting, American odds work on two different scales, depending on whether you’re betting at a price below even money or at a price of even money or higher. The odds for a a price below even money are preceded by a minus sign, as in -200. The number following the minus sign represents the amount of money you must wager in order to generate a profit of \$100 — in this case, \$200, for a total payoff of \$300 (the \$100 profit, plus your \$200 bet back).

Odds better than even money are preceded by a plus sign, as in +400, and the number following the plus sign indicates the amount of profit you’ll earn on a \$100 wager. In this example, you’ll earn \$400 of profit on a \$100 bet, for a total payoff of \$500.

## Fractional odds

In horse racing, odds are typically listed fractionally, such as 2-1 (also written as 2/1). The second number in the equation represents the amount you’re betting. The first number indicates the amount of profit a winning bet of that size will generate.

Calculating payoffs requires a bit of division and multiplication. For odds ending in one (such as 2-1, 3-1, 4-1, etc.), it’s pretty straight forward. If you’re betting \$50 on a 2-1 shot, multiply each half of the odds by 50 and combine the resulting figures to determine the total payoff. In this case, betting \$50 on a 2-1 shot will return \$150—\$100 of profit (50 x 2), plus your \$50 (50 x 1) bet.

Determining payoffs for odds ending in a number other than one is a little trickier. Let’s say you want to bet \$50 on a 9-5 shot. Go ahead and multiple both numbers by the size of your bet — in this case, you’ll wind up with a \$450 of profit on a \$250 investment. But after you combine these numbers (resulting in \$700), divide the result by the second half of the odds to determine the true payoff for your \$50 bet. In this case, the combined \$700 payoff is divided by five (as in 9-5) to reach the correct payoff of \$140 for a \$50 wager.

## Decimal odds

Also common in some areas of horse racing, decimal odds simply rewrite fractional odds in decimal form. If you take the fractional odds of 9-5 and turn them into a division problem (dividing nine by five), you wind up with 1.80, which is the amount of profit the wager will generate for every \$1 you bet.

Thus, the decimal version of 9-5 is correctly written as 1.80-1. Adding the two numbers together (1.80 + 1 = 2.80) gives you the total payoff for a \$1 wager. Once you have this combined figure, simply multiply it by the size of your wager to calculate the payoff. If you’re betting \$75 on a 1.80-1 shot, the payoff will be \$210 (75 x 2.80).

Now that you’re up to speed on three different ways of displaying odds, you can knowledgeably find betting value across the full spectrum of horse and human sports. Good luck!