What does a decimal price mean?
A price of 2.40 is a multiplier, not a dollar profit. For a normal winning cash bet, each $1 staked returns $2.40 in total, including that original $1.
That distinction matters when a bet slip shows a “potential return”. The full amount is not money gained: part of it is your stake coming back. Betfair’s decimal-odds explanation makes the same distinction between return and profit.
Calculate the return, then the profit
Total return if the bet wins = stake × decimal odds.
Profit = total return − stake.
For example, an $8 cash stake at 2.40 returns $19.20 if it wins. Subtract the original $8 and the profit is $11.20. If it loses, the return is $0 and the loss is $8.
These are arithmetic examples, not suggested bets or live prices. They assume ordinary settlement without fees or adjustments:
| Odds | Winning return | Profit |
|---|---|---|
| 1.60 | $16 | $6 |
| 2.40 | $24 | $14 |
| 4.00 | $40 | $30 |
At every price in the table, a losing bet still loses the full $10 stake.
Convert odds to implied probability
Implied probability (%) = 100 ÷ decimal odds.
At 2.40, the calculation is 100 ÷ 2.40 = approximately 41.67%. At 4.00 it is 25%. These percentages describe the price; they do not establish the actual chance of the selection winning.
A shorter price corresponds to a higher implied probability and a smaller winning return for the same stake. A favourite can still lose. The calculation does not mean a 4.00 selection must win once in every four attempts.
Why the percentages can exceed 100%
Consider a hypothetical market with exactly two possible outcomes, both priced at 1.90. Each price implies about 52.63%. Together they total about 105.26%, even though the two outcomes cover 100% of the possibilities.
The excess above 100% is called the overround. It helps explain why the displayed prices should not be treated as a set of true probabilities. It is not a prediction of the bookmaker’s actual profit on that event.
Betfair’s guide to odds and implied percentages (pages 36–37) explains this relationship. The examples here are our own.
Read the market as well as the number
The calculation only helps if you know what must happen for the bet to win. A match winner, a points handicap and a combined score are different propositions. Our AFL market guide explains those differences; our greyhound guide covers racing markets.
Check the selection, total cash stake, accepted odds and settlement rules on the slip. Do not apply a basic cash-bet example to a promotional credit without reading its terms. For an exchange, check commission too: the displayed return may be before charges. Betfair’s Sportsbook and Exchange odds guide notes that Exchange winnings are subject to commission.
For account and withdrawal checks, read our platform comparison checklist.
Keep the numbers in perspective
Understanding a return does not make betting a source of reliable income. NSW Government GambleAware explains that uncertain outcomes and bookmaker margins remain, even for people who know a sport well.
If you choose to bet, set a spending limit beforehand and keep money needed for bills separate. You can follow sport and racing without placing a bet.
Published 12 October 2026. Sources checked on the same date. Examples explain the maths; operator rules and charges must be checked separately.
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