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Understanding The Horse Racing Odds

The primary reason why people adore horse racing is that they want to bet on it and hope to win big in return. But, unfortunately, many horse racing fans make bets without the slightest understanding of the racetrack tote board. 

That’s why only a few people actually win. As a bettor, it’s your mission to be familiar with how horse racing betting odds work in the first place. 

Although the numbers on the tote board might seem intimidating and daunting, it’s quite easy to learn about the odds and payoffs. And with some practice, you’ll be able to calculate and make better bets. 

How Betting Odds Work

In essence, horse racing betting odds are fractions. For example, when a horse is priced at 1-5, it can be read as 1/5. The fraction means that for every one unit you bet, you’ll receive five units if you win (plus your bet).

If the numerator (first number) is larger than the denominator (second number), your payoff will be heftier than the amount at stake. On the other hand, if the denominator is larger, you are betting on the “odds-on favorite.” 

Odds-on occurs when you wager on popular horses. But you’ll have fewer chances to win because everybody’s betting on the same horse. Moreover, if the favorite wins, the betting pool will be divided among the winning tickets. As such, each one of them can expect a smaller portion of the betting pool.

How To Read The Odds

Here’s a brief explanation of how to read horse racing odds.

  • The Morning Line. These odds are placed on each thoroughbred by the racetrack’s handicapper. Also, they serve as the basis for betting on every race. Additionally, the odds are typically a reflection of each horse’s relative strengths. The morning line odds are either published in an online sportsbook, racing form, or tv program. Plus, they tend to change as more bets are placed. 
  • The Changing Odds. The horse racing betting odds will change depending on the number of people betting on every horse until post time. 
  • Favorites. Remember that each race has a public favorite and a horse that will most likely win the race. If two horses have the same odds, it’s tagged as a joint favorite (JF).
  • Probability. Fractions can easily be interpreted as probability percentages. For example, a race with a fractional odds of 1/1 signifies that there’d be one success for every defeat. Meaning you have a 50% chance of winning. 

Common Betting Payouts

The following payouts demonstrate how much a $1 bet would yield at different odds normally seen in horse racing. These figures only serve as a quick reference.


Odds $1 Payout + Return of the Original Wager
1-9 $1.10
1-5 $1.20
2-5 $1.40
1-2 $1.50
3-5 $1.60
1-1 $2.00
6-5 $2.20
7-5 $2.40
3-2 $2.50
8-5 $2.60
9-5 $2.80
2-1 $3.00
5-2 $3.50
3-1 $4.00
7-2 $4.50
4-1 $5.00
9-2 $5.50
5-1 $6.00
10-1 $11.00
20-1 $21.00
40-1 $41.00

How to Compute Payout Odds

Horse betting is usually challenging because the betting odds change every time a bet is placed. These changes are called pool betting or pari-mutuel wagering. In other betting games, you are playing against the house.

However, with horse racing, you’re betting against other high rollers. So, when a horse finishes the race and wins, the house will subtract its take. Then, the rest of the amount will be divided among the bettors who bet on the winning horse. 

There are many different types of pari-mutuel horse bets. However, the following are the most common types:

  • Exotic Bets
    • Superfecta Key. Choose four finishers, one horse who’ll win and the other three to finish in any order.
    • Superfecta Box. Predict four finishers in any order.
    • Superfecta. Predict the four finishers in the correct order.
    • Trifecta Key. Choose three finishers, one horse who’ll win and the other two to finish in any order.
    • Trifecta Box. Predict the three finishers in any order.
    • Trifecta. Predict three finishers in the correct order.
    • Exacta. Predict the first and second finishers. 
  • Straight Bets
    • Show Bets. Betting on the third finisher
    • Place Bets. Betting on the second finisher
    • Win Bets. Betting on the winning horse

To find out the possible net profit of any bet, use this formula:

  • Your bet x fraction odd = net profit

For example, a ten dollar bet on a ⅘ runner:

  • $10 x (⅘) = $8

Add back the original wager to determine your total profit.

  • $8+$10 = $18


There are a few things to consider regarding horse racing odds, which is why many people find it puzzling. But with practice, you’ll have higher chances of bagging a win. So hedge your bets and have fun at the racetrack!

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