Implied Probability, Overround and What Value Means

Decimal odds convert to implied probability by dividing one by the price. Odds of 2.50 imply 40%; odds of 1.50 imply 66.7%.

Add the implied probabilities of every outcome in a market and the total exceeds 100%. The excess is the overround. Removing it proportionally gives the book's fair probabilities.

"Value" has a precise meaning in this framework: a bet where your own estimated probability exceeds the price's implied probability after margin. It is not a synonym for a likely winner.

The practical difficulty is that estimating probabilities more accurately than a well-resourced pricing model is extremely hard, which is why most bettors lose over time. Understanding the arithmetic at least removes the illusion that short odds are safe.