When placing any bet, it’s important to know what the amount of money that you are staking is going to return to you. The level of returns can have a huge effect on how much you want to stake and also the amount of money that is on the line.
It’s pretty basic stuff to be honest, but if you are new to betting then it’s 100% something that you need to know. Whilst a lot of numbers can get thrown around when betting, especially online with odds and betting lines, once you mastered it then it will take next to no time at all to work out what returns you are due from any bet that you place.
Why is it Useful to Calculate Your Returns?
One of the biggest reasons why we need to do is to avoid confusion for the punter. Very few people would be comfortable in placing a bet and having no idea what the returns from their stake would be until after that bet has completed. There are exceptions to this in form of pool betting with companies like the Tote, but you’re always going to be getting a general idea of what will be coming your way, if not a fully accurate one until after the race.
Some bookmakers will tell you what you are due to be returned when you place your bet. To work it out, you just multiply your stake by the price. But, there are some that won’t highlight this amount, which is frustrating, so it’s important you know what you are due.
It helps down the line should any issues arise as well. Let’s say you were betting on a 10/1 shot with £10 stakes and it went on to win. But, the bookmaker then paid you just £50, which is half what you should be paid. If you weren’t aware then you might not realise the mistake of the bookmaker in what would prove for you, to be a very costly mistake.
How the Odds Work
Odds can be one of the hardest things to grasp when you first starting out with betting. It looks highly confusing, but actually it’s very simple. The odds that you see will reflect the chance of that selection has of winning. It also allows you to work out the returns that you will get for your stake.
For example, let’s say you back a horse to win its race at odds of 4/1. The bookmaker is essentially saying that every time this race was run under the same conditions, the horse would win 1 in 4 times. As the number increase, the chances of the horse winning technically decrease and as the number decreases, the chances of the horse technically increase.
The price, 4/1 is structured in a way that shows the returns you will get. With fractional odds, the left-hand column highlights the amount that you will get in terms of a net win if you wager the amount in the right-hand column. So, for a 4/1 shot, if you bet £1 you get a £4 net win.
An important note of this are the words net win. With winning bets, you also get your stake back. So, your total returns for this would be £5, which includes the £4 net win, plus your £1 original stake.
Whilst fractional odds are more traditional format of viewing odds, there are alternatives to the layout, in the form of decimal odds. Now, it’s worth noting that decimal odds and fractional odds both represent the same returns, but they are just laid out differently.
The decimal number is the amount that you get back that includes your stake. For example, if we carry on from the 4/1 bet above, if this was written a decimal, it would be highlighted as 5.00. As stated, the decimal price includes the net win for the bet and the stake that you place, so in this case, £4 net win and £1 stake, from traditional odds of 4/1, giving decimal odds of 5.00.
It basically comes down to personal preference between the two formats of odds and which one suits you best. Honestly, a lot of us use decimal now as you simply multiply your stake by the decimal and this is your returns, but if you’re more a traditional punter, fractional odds work just as well.
Let’s take a look a couple of simple bets and their returns that you could expect.
OK, so we decided to take on a race from Newmarket, the 15:10 which includes 8 runners. We pick out horse; Captain Sparrow at odds of 8/1 based on the price that we have taken about 30 minutes prior to that race starting and place our £10 bet to win.
We are in luck; the horse goes on to win and we go to get our returns. The payout would be as follows:
- £10 x 8 = £80 net win
- Plus original £10
- Total returns = £90
As you can see, we get an £80 net win from an 8/1 shot, plus our original stake of £10, meaning that we get £90 returned in total.
We’re on a roll and decide to take on the next race at Newmarket in the 16:00. This is a bigger field, with 15 runners in total. As a result, we decide to hedge our bets a little and instead of betting on the win only market, we decided to place an each way bet.
The horse that we have backed is Salty Star at odds of 25/1. As it’s an each way bet, there are two lines that we need to bet on; the win and the place. We place £10 each way, so a total bet of £20.
The place terms of the each way price is 1/5 of the starting price paying 3 places.
Salty Star runs well in the race and we can’t believe our luck as we get our second winner! The payout will be as follows.
- The win bet: £10 at 25/1 = £250 net win + £10 stake = £260 total
- The place bet: 1/5 of the odds = 5/1 x £10 stake = £50 + stake = £60 total
- Total returns from this bet = £300 net win, plus stake = £320
As you can see, we get a decent net win from the each way bet. If the horse was to not win, but still place, you can simply remove the win money to see your overall returns in this scenario.
Decimal and Fractional Returns Table
For reference, below we have a table of returns for a single bets of £10 on odds of between 1/100 and 100/1. We have included both fractional and decimal odds. Please note that the returns shown include the £10 stake.
|Fraction Odds||Decimal Odds||Returns||Fraction Odds||Decimal Odds||Returns|
Multiple betting is where you start to combine more than one selection into your bet. This means that instead of picking just one horse to win a race, you might pick two or three from different races. For these bets to be successful you need each of your selections to win.
Calculating the price is actually quite simple as all you do is multiply the two prices together. To get your price we think it’s much easier to use decimal odds as it’s just a straight multiplication between the two numbers.
Doubles are where you have two selections in your bet. To get the price of a double you just multiply the odds together and off you go. So, let’s say you picked a horse at odds of 9/1 (10.00) and another at 4/1 (5.00).
The double price for this would simply be 10.00 x 5.00, giving you a total price of 49/1 (50.00). Your returns would simply be 50.00 multiplied by whatever your stake was. For example, if you bet £10 on this, it would return £500.
The treble works in the same way as the double, except for this you have three selections in your bet instead of 2. Again, the process in terms of working out the odds is exactly the same, just multiplying each price together to get your multiple price.
So, three horses priced at 6/4 (2.50), 3/1 (4.00) and 5/1 (6.00), would give you a treble price of 59/1 or 60.00 (2.5 x 4 x 6). A £10 stake would return £600 bet, assuming all selections win.
The process for this continues as you keep adding in more selections. All you need to remember is multiply each selection by the other and then you can’t really go wrong. Using decimal odds is an easier way of quickly working these prices out, but it can be done with fractions as well if you’d rather.
Estimating Forecasts (CSF)
The Computer Straight Forecast (CSF) is one of the biggest mysteries in the betting industry. The bet is essentially where you choose selections (usually with horse racing) to finish in 1st and 2nd place in the correct order.
The mysterious part of the race is that you don’t really know what the odds will be for the race before you place your bet. In fact, in most cases you get told after the race.
A common misconception for this is that you multiply the odds of each together. But this is not the case as the bets are what are known in the industry as a related contingency. This means that when one result comes in, it affects the odds of the other result.
For example, you have two horses in your forecast that are both priced 5.00 to win the race. You bet one to come 1st and the other to come 2nd. If the 1st horse wins the race, then the odds for the second horse would no longer be 5.00 for it finish second. A horse that it was rivalled with is technically no longer in the race, so the odds for the other horse would need to drop.
The calculations that go into this are extensive to say the least. We won’t go into them here, but you can pick the 12 or so page document from the Association of British Bookmakers if you would like a bit of a brain teaser to get your head around it.
What we will say is that the formula is one that should keep changing. They do this to keep in mind of any rule changes. It was reported in 2006 that a rule change came in to take draw bias as part of the calculation for the price of the forecast.
So, if you had a race where the first 3 horses finished in the first 4 stalls, then there would be a low draw bias assumed for that race. This would in turn change the odds to reflect this.
The idea of the CSF is to prevent the bookies from having to pay out massive wins from bets that have unusual circumstances involved.
For example, in 2018 Tree of Liberty was named the shortest ever price loser of a National Hunt race at Ludlow, priced at 1/20. This horse should win almost every single time at this race and these odds, but when it happens, it means the bookies are susceptible to huge losses from successful forecast bets. The CSF would be able to take this into account and adjust the odds as necessary.
|2nd||Tree Of Liberty||1/20|
|Fell||Over To Midnight||25/1|
|Computer Straight Forecast||£23.47|
There are some bookies that will offer you some sort of prediction for the price, but nothing is set in stone until the end of the race.
The final point that we want to make is on the margins for these types of bets. To put it bluntly, they are not good. Brunel University did a study on it and found that overrounds were as high as 250% for some races. They even looked smaller field races that included just 4 runners to see these bets pulling up to 115% overround, which is astonishingly high for a race with just 4 horses involved.