Convert decimal, American or fractional betting odds into implied probability.
Implied probability shows what the odds represent mathematically. It does not predict the actual chance of an event happening.
Betting odds are more than just a number showing how much a bet can return. They also represent a probability.
Implied probability converts betting odds into a percentage, making it easier to understand how likely an outcome is being priced.
For example, decimal odds of 2.00 represent an implied probability of 50%, while decimal odds of 4.00 represent 25%.
The formula depends on the odds format you are using. The underlying probability is the same — only the way the odds are written changes.
The same betting price can be written differently depending on the odds format being used.
Although the odds look different, all three formats describe the same price and therefore the same implied probability.
The result tells you what probability is represented by the betting price. It does not mean that the event has exactly that chance of happening.
For example, decimal odds of 2.30 represent an implied probability of approximately 43.48%. Your own assessment of the outcome could be higher or lower.
Comparing the probability represented by the odds with your own estimate is one of the basic ideas behind identifying potential value in a betting market.
Odds of 2.00 do not prove that an outcome has a true 50% chance of happening. The percentage simply shows the probability represented by that price.
Bookmaker margin also matters. If you convert every possible outcome in the same market into implied probability and add the percentages together, the total will often exceed 100%.
That extra percentage is commonly known as the bookmaker's margin or overround.
Converting odds into probability makes betting prices much easier to understand. Instead of looking at numbers such as 1.50, +200 or 5/2 without context, you can see the percentage represented by each price.
It is also useful when comparing prices, evaluating betting markets and understanding concepts such as break-even probability, bookmaker margin and expected value.