Solved What is the term for ...

June 14, 2019 at 02:11:52
Specs: several
My question has absolutely nothing to do with computers, but
this forum is the most convenient place for me to ask...

What is the term for the difference in payout when, for example,
I will pay you $10 if you win a bet we make, but you only have
to pay me $1 if I win the bet?

-- Jeff, in Minneapolis

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June 14, 2019 at 09:35:31
In your example, 10:1 odds.

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June 14, 2019 at 11:59:20
Huh. So the term "odds" is used both for the probability of an
event and for the payoff ratio, even though the two may have
no relationship to each other. Huh.

Do you think that if I use the term "odds" to refer to a payoff ratio,
the listener is ... um ... likely to understand that that I mean payoff
ratio and not probability?

I'll bet you five dollars that there is a Ford model A in this garage,
and I'll give you odds of ten to one. Does that make sense? Is it
understandable? Is it dangerously ambiguous?

-- Jeff, in Minneapolis

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June 15, 2019 at 05:18:02
✔ Best Answer
It's completely understandable since you are talking about gambling, not statistics.

The article riider referred you to says that in no uncertain terms.

"In statistics, the odds for or odds of some event reflect the likelihood that the event will take place, while odds against reflect the likelihood that it will not. In gambling, the odds are the ratio of payoff to stake, and do not necessarily reflect exactly the probabilities."

That is why in gambling, the odds can change depending on how many people or how much money is involved. At some point the "house" may say "I can't afford to pay 10:1 on all these bets. I'm going to shorten the odds."


"The second reason is that one of the players has been bet on heavily, much more money coming in for that player over the other. When a bookmaker takes a majority of money on one particular selection they will have an uneven book, making a loss on that player, and a profit on the other – so they will shorten the odds on the player taking the money, and lengthen the other player. This should achieve the objective of evening their books up somewhat, if it doesn’t, they may well shorten the odds on that player again. They may keep shortening the odds, or make a stand, thinking they have taken a lot of money at bad odds for that player."

message edited by DerbyDad03

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