Convert American odds to a break-even rate

American odds describe payout relative to stake. Converting them to an implied probability lets you compare prices in a common unit. The resulting number is a price-derived break-even rate, not a prediction that the outcome will occur.

Work through it

1. For positive odds A, calculate 100 divided by A + 100. For negative odds −A, use the positive magnitude A divided by A + 100.
2. Convert the result to a percentage and keep the market terms alongside it. A different line or settlement rule is a different proposition.
3. Compare a model estimate only when its method and calibration are understood. A price by itself does not establish a profitable opportunity.

Check your result

• The odds sign is correct.
• The event and settlement terms match.
• Implied probability is labeled separately from a model estimate.