Implied Probability Calculator
Implied probability = 1 ÷ decimal odds. India at 1.80 implies 1 ÷ 1.80 = 55.56%. Add up every result of a market to see the bookmaker's margin: India 1.80 and Australia 2.10 make 103.17%, an overround of 3.17%.
An implied probability is the price written as a chance. The margin is inside it, so it is not the bookmaker's forecast. Take the margin out in proportion and India's no-margin chance is 53.85%.
By CricketPrediction.com ·
Odds to implied probability
One price per result of a market: decimal, fraction or American.
Enter a price for each result to see the implied probabilities and the margin.
Your chance against a price
Your own estimate, and the price on offer.
Enter your chance, and a price if you have one.
How to Calculate Implied Probability
- Turn each price into a chance. Divide 1 by the decimal odds: 1 ÷ 1.85 = 54.05%, and 1 ÷ 3.00 = 33.33%.
- Add up the market. Take every result of one market. The amount over 100% is the overround.
- Take the margin out if you need to. Divide each chance by the total. The results add up to 100%.
This implied probability calculator does all three as you type. It reads fractions and American odds too.
Worked Example: India v Australia
Say a bookmaker offers India at 1.80 and Australia at 2.10.
| Team | Odds | Implied | No margin | No-margin odds |
|---|---|---|---|---|
| India | 1.80 | 55.56% | 53.85% | 1.86 |
| Australia | 2.10 | 47.62% | 46.15% | 2.17 |
| Total | 103.17% | 100.00% |
The two chances add up to 103.17%, so the overround is 3.17%. A book this size pays back 96.92% of what is staked when bets are balanced. Take the margin out in proportion and India are 53.85% (no-margin odds 1.86) and Australia 46.15% (2.17).
Taking Out the Margin: the Proportional Method
The proportional method divides each implied probability by the market's total. It is also called the basic or multiplicative method. It is the simplest way to remove the margin. It assumes the bookmaker spread the margin in proportion to each price.
Bookmakers do not have to do that. Other methods share the margin out in other ways. Shin's method, the power method and the odds ratio method all give slightly different answers. One statistics package offers all of them, and its author finds the proportional method the least accurate. So treat a no-margin chance as an estimate of what the price says. It is not the true chance of the result.
Comparing a Price With Your Own Chance
Multiply your chance by the decimal odds, then take off 1. If you rate India at 60% and the price is 1.80, that is 0.60 × 1.80 − 1 = +8%: ₹100 expects ₹108 back.
The gap between your chance and the implied one is not the edge. At 2.00, a 60% chance against a 50% price is a 20% expected return, not 10%. And the sum is only as good as your chance. If you bet on your own estimates, size the stakes with a unit-based bankroll system.
Frequently Asked Questions
What is implied probability?
It is a price written as a chance: 1 ÷ the decimal odds. Odds of 2.00 imply 50%. The bookmaker's margin is inside it, so it is not the bookmaker's forecast of what will happen.
How do I calculate implied probability?
Divide 1 by the decimal odds and times by 100. Odds of 1.85 are 54.05%, and 3.00 is 33.33%. The shorter the odds, the higher the implied probability. For fractional or American odds, convert to decimal first, or type them into the calculator as they are.
What is the bookmaker margin, or overround?
Add up the implied probabilities of every result of one market. The amount over 100% is the overround. India 1.80 and Australia 2.10 make 55.56% + 47.62% = 103.17%, an overround of 3.17%.
How do you remove the margin from odds?
The simplest way is the proportional method: divide each implied probability by the market's total, so they add up to 100%. India's 55.56% becomes 55.56 ÷ 1.0317 = 53.85%. Other methods share the margin out differently, so treat the result as an estimate.
What are fair odds?
Fair odds for a chance are 100 ÷ that chance: a 60% chance is 1.67. If your 60% is right, a price above 1.67 has a positive expected return and a price below it a negative one.
How do I know if a price is value?
Multiply your chance by the decimal odds. At 60% and 1.80, each ₹100 expects ₹108 back, +₹8. At 60% and 2.00 it is +₹20, not the "10% edge" of 60% minus 50%. The answer is only as good as your chance.
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