Odds are generally displayed in three different ways: American odds, decimal odds and fractional odds. When it comes to horse races, the vast majority of racebooks opt for fractional odds. You will see a number, followed by a backslash and then another number. These numbers tell you the amount of profit you stand to earn by betting on that horse to win the race. The number on the left of the backslash tells you the amount you would win if you laid down the amount on the right of the backslash.
For example, you might see a horse priced at 5/1 to win a particular race. These are also known as 5 to 1 odds. It tells you that for every $1 you wager, you stand to win $5 if the horse wins. A $1 bet at 5/1 would therefore earn you a $5 profit. Your stake is returned to you when your bet is a winner, so your total return in this case would be $6. If you were to bet $10 at 5/1 and the horse won the race, you would make a $50 profit. If you bet $20, your profit would be $100, and so on.
Another example would be odds of 5/2, also known as 5 to 2 or 5 2 odds. In this case, you would win $5 for every $2 you staked. A $2 wager at 5/2 would therefore net you a $5 profit if the horse romped to victory. Your stake is handed back to you too, so you would receive a return of $7. If you bet $10 at 5/2, you would make a $25 profit. If you bet $20, your profit would be $70, and so on.
Sometimes a horse will be odds-on. That means the sportsbooks think it has a strong chance of winning the race. When a horse is odds-on, the number to the right of the backslash will be greater than the number on the left. For example, you might see a favorite priced at 4/5 and wonder how to calculate a 4/5 odds payout. It simply means that for every $5 you bet, you stand to win $4 if the horse is successful. A $5 bet at 4/5 would therefore earn you a profit of $4. As you get your stake back, your total return is $9. If you were to bet $20 at 4/5, you would earn a $16 profit if successful.