Implied probability is a way of expressing betting odds as a percentage. Instead of looking at a price such as 2.00 or 2/1, you can convert those odds into a percentage representing the likelihood implied by that particular betting price.
For example, decimal odds of 2.00 have an implied probability of 50%. Longer decimal odds, such as 5.00, have a lower implied probability of 20%.
Understanding implied probability can make it easier to interpret betting markets and see the relationship between odds, probability and potential returns. In this guide, we explain how to calculate implied probability using both decimal and fractional odds.
If you are still getting familiar with betting prices themselves, our guide to How do betting odds work? explains what odds mean, how they are set and the difference between shorter and longer prices.
What Does Implied Probability Mean?
Implied probability is the likelihood of an outcome expressed as a percentage based on its betting odds.
Every betting price can be converted into an implied percentage. For example:
Decimal odds of 2.00 = 50% implied probability
Decimal odds of 4.00 = 25% implied probability
Decimal odds of 10.00 = 10% implied probability
This does not mean that an outcome priced at 2.00 is guaranteed to occur exactly half the time. Implied probability is derived from the betting price rather than being a guarantee of the real-world likelihood of an event.
Bookmaker margins also need to be considered when looking at the probabilities across an entire market.
How Are Betting Odds and Probability Connected?
Betting odds and implied probability have an inverse relationship.
In general:
Shorter odds = higher implied probability
Longer odds = lower implied probability
Consider four decimal prices:
1.50 = approximately 66.67%
2.00 = 50%
4.00 = 25%
10.00 = 10%
As the decimal odds increase, the implied probability decreases.
The potential return moves in the opposite direction. For the same stake, longer odds produce a larger potential return than shorter odds. Our guide to How to calculate betting returns from odds explains this side of the relationship in more detail, including how to calculate potential profit and total returns.
How to Calculate Implied Probability from Decimal Odds
Converting decimal odds into implied probability requires a simple formula:
Implied probability = (1 ÷ Decimal Odds) × 100
Suppose the decimal odds are 2.00:
1 ÷ 2.00 = 0.5
0.5 × 100 = 50%
The implied probability is therefore 50%.
Now consider decimal odds of 4.00:
1 ÷ 4.00 = 0.25
0.25 × 100 = 25%
For decimal odds of 1.50:
1 ÷ 1.50 = 0.6667
0.6667 × 100 = approximately 66.67%
Once you know the formula, you can use the same calculation for any decimal price.
How to Calculate Implied Probability from Fractional Odds
Fractional odds can also be converted directly into an implied probability.
If the fractional odds are written as A/B, the formula is:
Implied probability = B ÷ (A + B) × 100
Take fractional odds of 2/1 as an example:
1 ÷ (2 + 1) × 100 = 33.33%
The implied probability is approximately 33.33%.
For fractional odds of 4/1:
1 ÷ (4 + 1) × 100 = 20%
Odds-on prices use exactly the same formula. At 1/2:
2 ÷ (1 + 2) × 100 = approximately 66.67%
If you want to understand how these prices relate to their decimal equivalents before calculating probabilities, our guide to Fractional vs decimal odds: what’s the difference? explains how both formats work and how to convert between them.
Implied Probability Examples
The relationship between fractional odds, decimal odds and implied probability can be seen in the following examples:
| Fractional odds | Decimal odds | Implied probability |
| 1/2 | 1.50 | 66.67% |
| 1/1 | 2.00 | 50% |
| 2/1 | 3.00 | 33.33% |
| 3/1 | 4.00 | 25% |
| 4/1 | 5.00 | 20% |
| 9/1 | 10.00 | 10% |
Equivalent fractional and decimal odds always produce the same implied probability.
For example, 2/1 and 3.00 are simply different ways of displaying the same betting price. Both therefore have an implied probability of approximately 33.33%.
Why Do Shorter Odds Have a Higher Implied Probability?
Shorter betting odds represent a higher implied chance of the selection occurring.
Imagine a football match where one team is considered a strong favourite. That team might be priced at decimal odds of 1.50.
Using the implied probability formula:
1 ÷ 1.50 × 100 = approximately 66.67%
An opposing team available at 5.00 would have an implied probability of:
1 ÷ 5.00 × 100 = 20%
The shorter-priced selection therefore has a higher implied probability.
However, short odds should never be interpreted as a guarantee. Sporting events remain uncertain, and favourites can lose.
Why Do Longer Odds Have a Lower Implied Probability?
Longer odds work in the opposite way.
Suppose one selection is priced at 2.00 and another is priced at 10.00.
The first has an implied probability of 50%, while the second has an implied probability of 10%.
The longer-priced selection also offers a larger potential return relative to the same stake. This reflects the lower likelihood represented by the betting price.
For example, a £10 stake at 2.00 has a £20 total potential return, whereas £10 at 10.00 has a £100 total potential return.
This does not mean the longer price is automatically better. The two prices represent very different implied probabilities.
Implied Probability and Bookmaker Margin
When you convert every selection in a betting market into an implied probability, you may notice that the percentages add up to more than 100%.
This is because bookmaker prices generally incorporate a margin.
Consider a simple two-outcome market where both selections are available at decimal odds of 1.90.
For each selection:
1 ÷ 1.90 × 100 = approximately 52.63%
Add the two probabilities together:
52.63% + 52.63% = 105.26%
The combined implied probability is therefore 105.26%, rather than 100%. In this simplified example, the amount above 100% reflects the bookmaker’s margin.
This is one reason implied probabilities derived directly from bookmaker odds should not automatically be treated as the objective or “true” probabilities of the outcomes.
Is Implied Probability the Same as the True Probability?
No. Implied probability is specifically the probability represented by a betting price.
A bookmaker’s odds are influenced by its assessment of an event and also incorporate a margin. Different bookmakers can offer different prices on the same outcome, which means those prices can produce different implied probabilities.
For example, one bookmaker might price a selection at 2.00, implying 50%, while another might offer 2.10.
At 2.10:
1 ÷ 2.10 × 100 = approximately 47.62%
The sporting outcome being considered has not changed, but the prices represent different implied probabilities.
Implied probability should therefore be understood as a way of interpreting odds rather than a certain prediction of what will happen.
Implied Probability and Betting Returns
Implied probability and potential betting returns are closely connected.
For example, consider a £10 stake at three different decimal prices:
| Decimal odds | Implied probability | Total potential return |
| 2.00 | 50% | £20 |
| 4.00 | 25% | £40 |
| 10.00 | 10% | £100 |
As the implied probability falls, the potential return for the same stake increases.
If you want to work through the calculations behind these figures, How to calculate betting returns from odds provides step-by-step examples for both fractional and decimal prices.
Remember that these are potential returns. The amount is only returned if the relevant conditions of the bet are met.
How Does Implied Probability Work in Sports Betting?
The same calculation can be applied across different sports and betting markets.
Imagine a simplified football 1X2 market with the following decimal odds:
Home win: 2.00
Draw: 4.00
Away win: 4.00
The implied probabilities would be:
Home win: 50%
Draw: 25%
Away win: 25%
In this simplified example, the three percentages total exactly 100%. In a real bookmaker market, the available prices will generally incorporate a margin, so the total implied probability may be above 100%.
The same principle can be applied to betting markets in tennis, basketball, horse racing and other sports available at NetBet Sport.
Why Is Understanding Implied Probability Useful?
Understanding implied probability gives you another way to read betting odds.
A decimal price such as 4.00 may not immediately tell a beginner how likely the outcome is considered to be. Converting it into an implied probability of 25% can make the meaning of the price easier to understand.
It can also help illustrate why shorter and longer odds provide different potential returns and make it easier to compare prices expressed in different formats.
However, calculating implied probability does not tell you which team or player will win. It simply converts the information contained within the betting price into a percentage.
Understanding Implied Probability
Implied probability converts betting odds into a percentage representing the likelihood associated with the price.
For decimal odds, use:
(1 ÷ Decimal Odds) × 100
For fractional odds A/B, use:
B ÷ (A + B) × 100
For example, decimal odds of 2.00 have an implied probability of 50%, while odds of 4.00 represent 25%.
Shorter odds generally have higher implied probabilities and smaller potential returns relative to the same stake. Longer odds have lower implied probabilities and larger potential returns.
Most importantly, implied probability is derived from betting odds and should not be treated as a guarantee of what will happen. Sporting events remain unpredictable, so if you choose to bet at NetBet Sport, only bet what you can afford to lose.
Implied Probability FAQs
What is implied probability in betting?
Implied probability is the likelihood of an outcome expressed as a percentage based on its betting odds. For example, decimal odds of 2.00 correspond to an implied probability of 50%.
How do you convert decimal odds into probability?
Divide 1 by the decimal odds and multiply the result by 100. For example, 1 ÷ 4.00 × 100 gives an implied probability of 25%.
Why do betting probabilities add up to more than 100%?
The implied probabilities of all selections in a bookmaker’s market can add up to more than 100% because the prices generally incorporate a bookmaker margin. The amount above 100% is commonly referred to as the market’s overround.
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