When I was but a wee lad, the odds on a bet were presented as a ratio. The ratio was profit:bet.
A bet that paid at 2:1 meant that for every dollar you paid, you would get two dollars of winnings, plus your original dollar. A bet that paid at 1:2 means that for every dollar you bet, you would get 50 cents of winnings, plus your original dollar. You bet the denominator (second number) to win the numerator (first number). You could bet 4:5, meaning you would get $.80 for each dollar bet, besides your original dollar.
To understand this you need to understand one thing only – the ratio of the two numbers compared to your bet.
At some point the way of expressing odds shifted. The current method is bad. It’s bad because it’s two different methods kludged together.
Positive odds (+): The number represents potential profit on a fixed $100 stake. “The Boston Celtics’ odds to win the 2025/26 NBA Finals are +650.” This means that for every $100 you bet, you would get back $650, plus your original $100 bet.
Negative odds (-): The number represents the required stake to achieve a fixed $100 profit. “The Oklahoma City Thunders’ odds to win the 2025/26 NBA Finals are -120.” This means that you need to bet $120 to win $100, plus your original $100 bet.
To understand this method, you need to switch between two different articulations – one is ‘how much a $100 bet gets you’, the other is ‘how much you need to bet to get $100’. This is not a natural cognitive match.
The whole idea of presenting winnings as a negative number is dumb. It is:
- Psychologically backwards: Negatives should be for losses only.
- Counter to ordinary reasoning: “I have $100 to bet, what will I get for it?”
- Fragile: If the odds change from slightly below even to slightly above even, the entire presentation system changes.
- Inconsistent: Consistency would mean that positive bets are how much I need to bet to get $100, not how much betting $100 gets me.
I propose we get rid of negatives. Instead, all bets should be normed to $100, and they are all positive. The odds for San Antonio winning the championship would not be presented as -120, they would be presented as +83.33. If you bet $100 and win, you will get $83.33 back (besides your original $100). This is self-consistent and removes unneeded mental switches.
Let’s get rid of this nonsense. If you bet $100 on the Pats to win 10 or more games you get $68.97 in winnings. It should be presented as +68.97.