Fixed Odds Betting Explained
In a nutshell, “Fixed Odds Betting” is a type of bet that is placed on odds that are predetermined.
What does this mean?
The person placing a fixed odds bet knows exactly what profit they will make at the time of the bet, should they win. Odds may change after the bet is placed, but the potential winning amount will remain the same.
Examples of Fixed Odds Betting
Dan bets $10 on a game with 2:1 odds. If Dan wins, his return would be $30 ($20 winnings plus his $10 bet). If Dan does not win, he loses his original $10 bet on the game.
Sarah places a $10 bet with the odds of 10:1. The winnings would be $100, plus the original $10 bet, should she win. That is a return of $110 total. If the horse Sarah bet on does not win, then Sarah loses her original $10 bet.
Let's say Sarah placed a $15 bet, instead of $10, on the same 10:1 odds race. The winnings would be $150, plus the original $15 bet, should she win. That is a return of $165 total. If the horse Sarah bet on does not win, then Sarah loses her original $10 bet.
Bob, the player, bets $100 with the odds of 2.00 (1:1). The bet is accepted. Prior to the start of game, but after the bet was made, the odds drop from 2.00 to 1.40. If Bob wins, he will still receive the winnings of $200 for the odds of 2.00 (1:1).
How to calculate fixed odds betting.
When a player wants to bet using fixed odds, they should know what the odds are at the time the bet was made. This is commonly referred to as the “live price.” Their are also “starting prices,” which are what the fixed odds would be at the time the race starts, and not at the time the bet was made.
Keep in mind that bookies price bets so that whatever the outcome will be, it will always be in their favor. The total of all possible quoted outcomes will be more than 100%, which is known as “overround.”
3 Types of Odds
1) Moneyline Odds (aka American Odds) – When a player bets Moneyline Odds, they are betting on the odds of the overall outcome of the game – or winner – regardless of point spread. The players are given the odds of the game winning, to which there are only two possible outcomes for Moneyline Odds: positive or negative.
2) Fractional Odds – The net total paid to the winner relative to the risk of the bet. In other words, the amount that will be paid should the bet win. For example, 4:1 would have the return of 4 multiplied by the stake, plus the original stake.
3) Decimal Odds – The stake multiplied by the decimal shown. This figure would be the amount the player would receive, if they won. An easy example of this is a $1 bet with the odds of 5.00. The winning amount would be $5.00.
Pros and Cons of Betting Fixed Odds
Regardless of odds fluctuating, potential winnings do not change.
Odds shortening will not affect the player.
The player knows what the exact potential winnings are.
Bookies always have the upper hand.
If the price rises, the player does not receive higher winnings.
Most bets these days are fixed odds, which makes this type of betting quite common. Players that bet this way, tend to be players that teeter more on a balanced see-saw of risk. There is comfort in knowing that if the odds change for a lower winning amount, the fixed better is not affected. In turn, however, there is risk of disappointment should the odds turn in favor of a higher winning amount, where the player only receives the winning amount that is quoted (fixed) at the time they placed their bet.