![\"Implied](\"https:\/\/www.rulesofsport.com\/betting\/wp-content\/uploads\/2022\/07\/implied-probability-400px.jpg\")
We all have a rough idea of what price we are willing to pay for a product or service \u2013 it just becomes an innate sixth sense.<\/p>\nWe all have a rough idea of what price we are willing to pay for a product or service \u2013 it just becomes an innate sixth sense.<\/p>\n
From a new house or car to fish and chips by the seaside, the vast majority of us know when we\u2019re getting a bargain, when the price is fair and when we are being ripped off, too.<\/p>\n
But it\u2019s amazing how many punters don\u2019t know when they are getting good value or not with their bets, and the reason for that is that they don\u2019t have an understanding of implied probability \u2013 a fairly straightforward calculation that lets you know whether you\u2019re getting value or not.<\/p>\n
![\"Man](\"https:\/\/www.rulesofsport.com\/betting\/wp-content\/uploads\/2022\/07\/man-thinking-holding-football-400px.jpg\")
In betting terms, the most useful application of implied probability is that it converts odds \u2013 be it fractional, decimal or American \u2013 into a percentage, and it\u2019s this number that determines the likelihood of an event occurring.<\/p>\n
We\u2019ll have more examples later in this article, but let\u2019s imagine for now that the bookmakers have Manchester City as an even money (or 2.00 in decimal terminology) chance to beat Liverpool. This translates as a 50% chance of them winning the game.<\/p>\n
And your mission is to decide whether City have a better or worse probability than 50% of winning the contest \u2013 if you think it\u2019s a higher than 50% chance, these would be value odds. If you think that it\u2019s less than 50%, then the implied value is in the draw or backing Liverpool.<\/p>\n
Once you get your head around the idea of implied probability, you\u2019ll wonder how you ever had a bet without it.<\/p>\n
![\"Calculator\"](\"https:\/\/www.rulesofsport.com\/betting\/wp-content\/uploads\/2019\/04\/bigstock-everydayplus-calculator-400px.jpg\")
Okay, so here\u2019s the fun part: doing the calculation for implied probability.<\/p>\n
It becomes so much easier to work out when you use decimal, as opposed to fractional, odds, so consider switching your betting site\/app to decimal in your settings.<\/p>\n
If not, you can type \u2018convert fractional odds into decimal\u2019 into your preferred search engine.<\/p>\n
So, let\u2019s say we have a football game with the following decimal odds:<\/p>\n
The calculation for converting decimal odds into probabilities is as follows:<\/p>\n
(1\/decimal odds) x 100<\/strong><\/p>\n So let\u2019s work through those examples again\u2026.<\/p>\n You\u2019ll notice that the percentages don\u2019t add up to 100%… why? That\u2019s to do with the bookmakers\u2019 margin, which we\u2019ll cover in the next section.<\/p>\n You can use the formula above to calculate the implied probability of any priced sporting event.<\/p>\n Here\u2019s a horse race as another example:<\/p>\n The number over the 100% mark is the bookmakers\u2019 margin \u2013 that is, the over-round they apply to their odds in order to balance their books and walk away with either a profit or a managed loss, depending on whether the favourite wins or not.<\/p>\n A handy way to think about this is if we were betting on a coin toss: in theory, the odds for heads or tails should both be even money (2.00). But a bookie wouldn\u2019t make a profit long term with this kind of thinking, and so they would probably offer something like 10\/11 (1.91) for heads or tails\u2026 creating that all-important margin.<\/p>\n Now, you wouldn\u2019t bet on heads or tails at 1.91, would you!? Not now that you know about implied probability, anyway, because you know each side of the coin has a 50% chance of landing\u2026 the implied probability of 1.91 odds is 52.4%, and so you could say your value on such a bet would be -2.4%. That\u2019s not a recipe for betting success.<\/p>\n Calculating these probabilities alone isn\u2019t enough to turn you into a profitable punter, but for anyone that struggles to work out whether they are taking value prices or not, this is a very useful guide.<\/p>\n The skill, of course, is in deciding if Manchester have a greater or less than 50% chance of winning, or whether Acrion is a more or less likely winner than his 22.2% probability implies.<\/p>\n That bit, we\u2019re afraid though, is completely down to you to decipher\u2026.<\/p>\n","protected":false},"excerpt":{"rendered":" We all have a rough idea of what price we are willing to pay for a product or service \u2013 it just becomes an innate sixth sense. From a new house or car to fish and chips by the seaside, the vast majority of us know when we\u2019re getting a bargain, when the price is […]<\/p>\n","protected":false},"author":3,"featured_media":0,"parent":69,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_acf_changed":false,"footnotes":""},"class_list":{"0":"post-1504","1":"page","2":"type-page","3":"status-publish","5":"entry"},"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/pages\/1504","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/comments?post=1504"}],"version-history":[{"count":7,"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/pages\/1504\/revisions"}],"predecessor-version":[{"id":1546,"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/pages\/1504\/revisions\/1546"}],"up":[{"embeddable":true,"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/pages\/69"}],"wp:attachment":[{"href":"https:\/\/www.rulesofsport.com\/betting\/wp-json\/wp\/v2\/media?parent=1504"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
\n\n
\n \nHorse<\/th>\n Odds<\/th>\n Implied Prob.<\/th>\n<\/tr>\n<\/thead>\n \n Acrion<\/td>\n 4.5<\/td>\n 22.20%<\/td>\n<\/tr>\n \n Recon Mission<\/td>\n 6.5<\/td>\n 15.40%<\/td>\n<\/tr>\n \n Saaheq<\/td>\n 7.5<\/td>\n 13.30%<\/td>\n<\/tr>\n \n Pablo Del Pueblo<\/td>\n 8.5<\/td>\n 11.80%<\/td>\n<\/tr>\n \n Han Solo Berger<\/td>\n 9.5<\/td>\n 10.50%<\/td>\n<\/tr>\n \n Street Parade<\/td>\n 10<\/td>\n 10%<\/td>\n<\/tr>\n \n Delegate This Lord<\/td>\n 11<\/td>\n 9%<\/td>\n<\/tr>\n \n Nordic Glory<\/td>\n 13<\/td>\n 7.70%<\/td>\n<\/tr>\n \n Manettino<\/td>\n 15<\/td>\n 6.70%<\/td>\n<\/tr>\n \n Impeach<\/td>\n 30<\/td>\n 3.30%<\/td>\n<\/tr>\n \n Total<\/td>\n –<\/td>\n 110%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Understanding the Impact of the Bookies Margin<\/h2>\n
![\"Coin](\"https:\/\/www.rulesofsport.com\/betting\/wp-content\/uploads\/2022\/07\/coin-toss-400px.jpg\")
In both of the examples provided, you may have noticed that \u2013 unlike what our maths teachers at school taught us \u2013 the markets didn\u2019t add up to 100%.<\/p>\nHow to Use Implied Probability in Betting<\/h2>\n
![\"Online](\"https:\/\/www.rulesofsport.com\/betting\/wp-content\/uploads\/2021\/08\/online-betting-400px.jpg\")
Implied probability allows us to assign a percentage chance to an outcome using a fairly simple calculation, and often this is an excellent starting point for working out whether a set of odds are value or not.<\/p>\n