How To Calculate True Odds For Horse Racing

Horse racing is one of the oldest sports in the world, and people have gambled on it for almost as long as it’s existed.

It’s also one of the most popular sports in the country for betting on, with on course race betting alone accounting for £283 million in revenue in the year 2022-2023, while off course betting revenue was an incredible £3.33 billion.

Source: Statista on course horse race betting revenue and off course betting revenue

Clearly, there’s no shortage of punters keen to bet on horse racing - and most of them will, on average, end up losing money.

So how can you become the exception to the rule, the bettor that actually makes a profit from horse racing?

In this article, we’ll talk you through how to calculate true odds and use them to inform your own betting strategies, as well as alternative methods of making more reliable profits from horse racing betting, such as Matched Betting.

What Are True Odds?

True odds are odds that indicate the actual chance of a selection winning.

True odds are different from the odds offered by bookies in that they represent only the real chance of a win, whereas bookie’s odds include their profit margin and adjustments to influence bettors’ decisions.

This means that you cannot reliably gauge the probability of a particular horse winning its race from the odds you see - even if you can get a general idea of its comparative chances.

In order to get the best possible picture of the horses that offer bettors the best chance of a win, and hopefully a sizeable profit, punters and tipsters will try to work out the true odds for each horse in a race, which can then be compared against the odds offered by the bookies.

Of course, it isn’t really possible ever to be sure of whether the odds you’re looking at are in fact the true odds or not - when we talk about ‘true odds’, we mean our best guess.

However, that doesn’t mean that making an effort to calculate true odds isn’t worth your time. There’s an enormous amount of information out there that can be used to inform calculations of true odds, which can potentially give you a leg up over the bookies when it comes to placing your bets.

What About Fair Odds And Implied Probability?

It’s extremely common to confuse fair odds and true odds, so we’ll take a moment to explain exactly what this terminology means.

Implied probability

‘Implied probability’ simply means the probability of any competitor winning implied by the odds you see. This can be calculated from any set of odds by performing some fairly simple maths - for decimal odds, the formula is simply 100/odds.

For example, for decimal odds of 4.0, you would do the following calculation:

100/4 = 25

= 25% probability

Implied probability isn’t, of course, the same thing as the true probability of an outcome occurring - it just tells you what chance of a win is implied by the odds you see.

Fair odds

The term ‘fair odds’ refers to the odds offered by a bookie without their profit margin. We’ll take a quick look at an upcoming horse race to illustrate how you can work out the fair odds from the odds you see on a bookie’s website.

First of all, we need to work out the implied probabilities for all the horses in a race.

As you can see, when you add the implied probabilities together you get a total of more than 100%, which ought to be impossible. That extra 10% is the bookie’s margin, or ‘overround’.

To work out the fair odds, we need to subtract that 10% from the implied probabilities (which we can do by dividing the implied probability by 110, and then multiplying by 100). We then convert the fair probabilities back into decimal odds format to get the fair odds.

Fair odds are easy enough to calculate, but you should bear in mind that they aren’t the same as true odds. They remove the bookie’s margin, but bookies adjust their odds beyond a straightforward profit margin.

Their profit is safer if the volume of betting on all sides of a race is roughly even, meaning that they may increase or decrease odds on certain selections to encourage or discourage punters to bet on them.

This is why it’s important to have an idea of the true odds of a selection, in order to make an informed decision as to whether it’s worth betting on.

How To Work Out Your Own ‘True Odds’

Attempting to establish the best system for working out true odds has occupied some of betting’s finest minds for decades, if not centuries.

A huge number of variables go into the calculations bookies make to determine the likelihood of each horse winning its race, and they have the advantage of extremely powerful software on their side.

That said, it is possible to work out your own true odds, it just takes a lot of industry knowledge and research - and ideally, a good head for mathematics.

If you’re a comparatively new bettor on horse racing, this is likely to be an off-puttingly complex process, so we’d recommend this approach solely to experts.

To decide for yourself what the true odds for each horse in a race might be, you’ll need to consider and weigh a number of factors, which can be roughly divided into a few categories:

• Form. This includes the horse’s age, how much racing the horse has done recently, and any knowledge of possible injuries or health issues.

• Performance. While there is some overlap with the horse’s form, performance would include the horse’s position in recent races, taking into account the strength of the competition, the jockey’s contribution, and how much weight was carried in handicap races.

• Environment. This refers to external factors, such as the surface of the race in question (which a horse may perform better or worse on), the weather conditions, and the distance of the race.

You’ll need to settle on a way of converting all these factors into hard data, to allow you to rate each horse accordingly, before establishing the percentage chance of success for each horse on that basis.

Having done so, simply convert those percentages into your preferred odds format to produce your own set of true odds.

The more you do this, the more you’ll be able to refine your system and, hopefully, improve its accuracy - but keep in mind that no system is perfect, including the bookie’s.

How To Use True Odds To Find Valuable Bets

Once you’ve got your own set of true odds, you’re in a great position to track down bets that offer positive value.

Simply put, wherever a bookie’s odds are higher than the true odds you’ve produced, it’s probably worth placing a bet, as you should, on average, end up making more in profit than you lose.

It must be said, though, that working out your own true odds is a laborious process. Realistically, unless you’re a professional sports bettor, it’s probably not going to be worth your time.

Fortunately, there are tools available to help you track down valuable bets without expending hours and hours on research and number-crunching.

Outplayed’s Pro subscription allows you access to some of our most powerful value betting tools for horse racing, which compare bookie odds to the true odds calculated by our software to identify valuable selections.

Outplayed Tools

• Lucky Finder. The Lucky Finder accurately finds Lucky 15 bets with positive value on your behalf. You don’t need to do any calculations yourself, you simply choose a bookmaker, click ‘search’ and the software will show you four selections to add to your bet slip and place your Lucky 15 bet!
  You’ll experience some upswings and downswings, as with all value betting, but over time you’re likely to see a steady upward trend in your profit.

• Extra Place Master. The Extra Place Master tracks down the best value picks from horse races with extra places.
  It offers two modes, allowing you either to place fully laid matched bets, where you profit if your horse hits the extra place, or to place an unlaid each way value bet, where your chances of winning or placing are higher than the odds would imply, resulting in positive EV.

Matched Betting - An Alternative Strategy To Make Money From Horse Racing

For a less risky alternative to value betting on horse racing, you can’t go wrong with Matched Betting.

Matched Betting is the strategy of betting both for and against the same outcome. So for example, if we consider the race we were looking at earlier in the article, you might bet that Regalion wins, and also that it doesn’t win.

You make your profit by combining this technique with the many promotions bookies use to lure new customers. For example, you might see an offer where you have to place a £10 bet (known as a qualifying bet) to receive a £10 free bet.

If you match both bets, you can roughly break even on the first bet, and then use your free bet to make a profit - if you do it right, there’s no risk at all.

Between sign up offers and reload offers, you can make £300 - £1000+ a month. A few people even make a living this way!

As horse racing is hugely popular for sports betting in the UK, you’ll find a wide variety of offers available most of the time, with festivals such as Cheltenham being particularly profitable.

Summary

Working out the true odds for a horse race can be a very useful means of profiting from sports betting - but it’s time consuming, relies on expert knowledge, and even after all your effort you’ll never be able to completely rely on your results.

For an easier way to track down high value bets, Outplayed Pro members have access to our Extra Place Master and Lucky Finder tools, which create thousands of pounds in profit for our members every single month.

Alternatively, if you’d prefer a less risky way of profiting from horse racing, Matched Betting is the way to go! Check out our beginner’s guide to find out more, or alternatively test out our software with a 7 day free trial and start making your first profits today.