In the world of betting, odds play a really important role. In fact, the entire system of betting is based on odds, where people wager money and expect a return based on their prediction.
Odds for bookmakers represent probabilities of certain outcomes in sporting events happening. However, for the bettors, the odds are used to calculate their potential winnings.
The bookmakers run complex algorithms by gathering different data from the sport to calculate the probability of an event.
Since the probability cannot be displayed with a percentage since it would be too obvious for the bettors, bookmakers use odds that will determine the total money returned on a winning bet, as you can see on TwinSpires horse racing page.
With that said, there are different types of odds in the betting space. The odds can come in different types such as decimal, fractional, Moneyline, or American odds. All of these odds represent a certain probability but they are different due to the region or sport you want to bet on.
There are also fixed and variable odds. In today’s article, we will focus on FIXED odds and find out how they work and how to calculate them.
What is Fixed Odds?
In the world of sports betting, the word “Fixed” can be interpreted in many different ways. Most bettors use the word “fixed” for the act of throwing away games just to make money from betting, which is an illegal activity.
When it comes to Fixed Odds, these have an entirely different meaning. Fix odds represent locking in a bet at a certain price or odds. This means that once you make the bet and the sportsbook accepts your wager, the odds of the bet cannot change.
For example, let’s take these American odds.
Horse number 1 – (+180)
If you decide to bet on this horse to win a race, your potential payout will be $280. With fixed odds, once you make the bet, nothing can change the odds. So, if some news about the horse affects its odds, or has poor prep race results, the odds for you will remain the same, and you’ll still walk away with $280 even if the odds change.
How Does Fixed Odds Betting Work?
Fixed-odds betting is the most commonly used form of betting around the world. It works in the simplest way possible that is fair for the better and for the bookmaker. Both have the identical risk of a certain outcome changing the probability of something happening in a match or race.
Fixed odds work differently compared to starting price or pari-mutuel betting. Starting price betting is most common in horse racing, which means that the odds drop just before the event starts.
With pari-mutuel betting, your potential returns are calculated once everyone places their bets and the money has been pooled and divided across the winners.
When it comes to fixed odds, the system process is much simpler. Fixed odds are the only form of betting where you can calculate your returns the second you make the bet.
How to Calculate Fixed Odds?
The process of calculating fixed odds is actually really straightforward, and much more simple than other betting odd types.
All you need to do to calculate your potential winnings is to use the amount of money you wagered and the fixed odds that appeared when you made the bet.
For example, if you made a $100 bet on a 3.5 decimal odd, your potential winnings will be $350. However, if you add multiple matches or races in the same bet, the process is a bit more complicated and it is best if you use a betting calculator.
Multiple bets per ticket mean that the fixed odds are combined together and then multiplied by the type of odd in order to find out how much you can win.
With that said, fixed odds are the simplest form of betting and the system is beginner-friendly allowing you to stay on top of your game without diving deeper into how the odds work.