What Implied Probability means
Implied probability converts a set of odds into the percentage chance that price represents. For American odds, a negative number's implied probability is calculated as odds/(odds+100); a positive number's is 100/(odds+100). A -150 favorite carries an implied probability of 60%; a +150 underdog carries an implied probability of 40%. Comparing implied probability against your own independent estimate of how likely an outcome actually is - rather than just looking at which side "feels right" - is the foundational skill behind finding value in sports betting, since a bet is only profitable long-term if your true win probability exceeds the implied probability baked into the price.
Key points
- Implied probability converts a set of odds into the percentage chance that price represents.
- A -150 favorite carries an implied probability of 60%; a +150 underdog carries an implied probability of 40%.
- Comparing implied probability against your own independent estimate of how likely an outcome actually is - rather than just looking at which side "feels right" - is the foundational skill behind finding value in sports betting, since a bet is only profitable long-term if your true win probability exceeds the implied probability baked into the price.
Example and context
A -150 favorite carries an implied probability of 60%; a +150 underdog carries an implied probability of 40%.
Related glossary terms
These terms sit in the same part of the betting vocabulary and are useful to read next.
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