How We Turn Bookmaker Odds Into Win Probabilities

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Every percentage on the StatsDream prediction pages starts life as a bookmaker price. We don't run a secret model and we don't sell tips. We read the prices several bookmakers offer on the same game, turn each price into a probability, remove the bookmaker's margin, and average the result. This page shows the arithmetic, so you can check any number on the site yourself.

Step 1: a decimal price is a probability in disguise

Decimal odds tell you what a winning one-unit stake returns, stake included. A price of 2.00 returns two units, so the bookmaker is pricing the outcome as a coin toss: one chance in two. The conversion is a single division:

implied probability = 1 ÷ decimal odds

A price of 1.25 means 1 ÷ 1.25 = 80%. A price of 5.00 means 20%.

Step 2: the prices add up to more than 100%

Take a basketball game priced at 1.80 for the home side and 2.10 for the away side. Converted:

OutcomePriceImplied probability
Home win1.8055.6%
Away win2.1047.6%
Total103.2%

One of the two teams will win, so the true probabilities must add up to exactly 100%. The extra 3.2% is the bookmaker's margin, often called the overround or the vig. It's how the bookmaker earns money whichever side wins.

Step 3: take the margin out

To get a fair probability, we divide each implied probability by the total:

  • Home: 55.6% ÷ 1.032 = 53.9%
  • Away: 47.6% ÷ 1.032 = 46.1%

The two numbers now add up to 100%. This proportional method spreads the margin evenly across the outcomes. It'sn't the only method, but it's simple, transparent and close enough for everyday use.

Step 4: average across bookmakers

One bookmaker can be slow to react to team news, or can shade a price to balance its own book. So we repeat the calculation for every bookmaker that prices the game, then average the margin-free probabilities. For football that's usually eight or nine bookmakers. The averaged figure is the one you see in the 1, X and 2 columns. The tip is simply the outcome with the highest probability.

The same arithmetic applies to every other market on the site. Correct score, both teams to score, half-time/full-time and the goal lines each have their own set of prices, and each set is converted and cleaned separately.

What a percentage does and does not tell you

A 70% favourite is expected to lose three times in every ten. Across a full day's schedule that happens constantly, and it isn't a sign that the number was wrong. The test of a probability is whether events priced at 70% happen about 70% of the time over many games. That's why every prediction page marks each tip right or wrong once the result is in, and why the pages show a running track record once enough games have been settled.

Two more things to keep in mind:

  • The market isn't the truth, only the best available estimate. Prices move right up to kick-off as team news and money arrive. Our tables refresh through the day, but a probability read in the morning can be stale by the evening.
  • A fair probability isn't a good bet. Once the margin is removed, the bookmaker's own price is always slightly worse than the fair one. Knowing that a team is a 54% favourite doesn't make backing it at 1.80 profitable.

Predictions are information, not betting advice. Gambling is for adults (18+) only. Set limits, and never stake more than you can afford to lose.

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