How does betting work, and how do the numbers add up?
Fixed-odds betting turns a price into a payout: stake times decimal odds. The same price implies a probability, and the prices across a market add up to more than 100%, which is the margin. This hub explains odds, multi bets, margin and expected value with worked examples, all marked illustrative, and points to the calculators.
Pages in this section
- 01How does online sports betting work in Australia, and what do you need to start?How online sports betting works in Australia, start to finish
- 02Decimal odds explained: from price to payout in three stepsHow to read decimal odds and work out a return
- 03Multi bets explained: legs, combined odds and what a lost leg doesWhat is a multi bet, and how is the payout worked out?
- 04Do you pay tax on betting winnings in Australia?Are betting winnings taxed in Australia? What the ATO says
- 05Stake limits and account closures: what the terms sayCan a bookmaker limit your bets or close your account?
- 06Winning consistently online: what the evidence and the arithmetic showCan you win consistently betting online in Australia?
- 07Bookmaker margin: does it make long-run winning almost impossible?Are bookmaker odds fair? Margin, overround and long-run results
- 08Giving a betting app your ID and payment details: what protects you?Is a betting app safe to use with your ID and card details?
- 09Implied probability, defined with a worked exampleImplied probability: what decimal odds say about chance
- 10Overround: how the margin is built into the pricesBookmaker margin (overround): definition and worked example
- 11Cash out, defined: early settlement of an open betCash out: what early settlement means for a bet
- 12Expected value of a bet: from odds and your own estimate to a resultExpected value calculator for a single bet (educational)
- 13Turnover arithmetic: how a stated requirement is worked outWagering turnover calculator: worked examples
The three numbers
Return. Stake times decimal odds. A$20 at 2.50 returns A$50.00, which is A$30.00 profit plus the A$20 stake.
Implied probability. One divided by the odds. At 2.50 that is 0.40, or 40%.
Margin. Add the implied probabilities across a market and subtract one. Two outcomes priced at 1.90 each give 52.63% plus 52.63%, or 105.26%, so a margin of 5.26%.
Illustrative example, not a price.
The upshot: price, implied probability and margin are the same arithmetic seen three ways.
Multi bets
A multi bet combines legs, and the odds multiply. Three legs at 1.80 each combine to 1.80 × 1.80 × 1.80 = 5.832. A$10 returns A$58.32.
One lost leg loses the whole bet. Illustrative example, not a price.
Expected value
Expected value is stake × (your probability × odds − 1). With odds of 3.00 and your own estimate of 30%, the result is 0.9 − 1 = −0.10 per A$1 staked. The estimate is yours, not a fact.
The arithmetic only shows what the estimate implies.
Illustrative example, not a price. The calculators on this site use the same formulas and are for education.
The upshot: the formula is simple; the estimate you feed it decides everything.
Where the limits are
Online in-play betting on sport is banned. Credit cards and digital currency are banned for betting. Both rules are explained on licensing and legality and paying a bookmaker.
Tools to stay in control are on staying in control.
18+ and where to get help
18+ only. Gambling can be harmful. Need help? Call Gambling Help Online on 1800 858 858 (free, 24/7) or visit gamblinghelponline.org.au. To exclude yourself from licensed Australian online and phone wagering providers, register with BetStop at betstop.gov.au. BetStop help line: 1800 238 786.
FAQ
How do decimal odds turn into a payout?
Multiply the stake by the odds. A$20 at 2.50 returns A$50.00, including the stake.
What is a bookmaker's margin?
The amount by which the implied probabilities across a market exceed 100%. Two outcomes at 1.90 give 105.26%, a margin of 5.26%.
What happens to a multi bet if one leg loses?
The whole bet loses. The odds of the legs multiply, so the payout is higher, but every leg must win.