Gambler’s Manifesto: Betting Odds Explained



Betting Odds Explained: How to convert the odds and handicap MMA fights!

“He simply says, if a business is worth a dollar and I can buy it for 40 cents, something good may happen to me.  And he does it over and over and over again.”

            -Warren Buffett on fellow value investor Walter Schloss

The process of handicapping fights is simple.  The first step is to convert the money line odds into percentages.  The second step is to compare our prediction for the fight, our percentages, to the money line percentages.  And the third step is to consider whether we have a large enough margin of safety to place a bet.

The money line odds are set by the bookmakers to reflect the general MMA fan base’s thoughts about a fight, which will be reflected in the bets that they place.  The odds assigned to each fighter reflect the chances that the MMA fan base, which we will sometimes refer to as the market, gives that fighter to win.  These odds can be converted into percentages.  These percentages are the chance that the market is giving the fighter to win.  This is the first step of the handicapping process.

To convert money line odds with a negative sign in front of them, divide the negative money line odds by itself minus 100.  And to convert money line odds with a positive sign in front of them, divide 100 by the positive money line odds plus 100.

Example 1:  Dan Henderson +350 is fighting Jon Jones -550

Dan Henderson’s chance to win = 100 ÷ (350 + 100)

= 100 ÷ 450

= 22.22% chance to win

Jon Jones’ chance to win = -550 ÷ (-550 – 100)

= -550 ÷ -650

= 84.62% chance to win

Example 2:  Frankie Edgar +135 is fighting Ben Henderson -165

Frankie Edgar’s chance to win = 100 ÷ (135 + 100)

= 100 ÷ 235

= 42.55% chance to win

Ben Henderson’s chance to win = -165 ÷ (-165 – 100)

= -165 ÷ -265

= 62.26% chance to win

You can perform the conversions on your own with a calculator, or you can use websites that provide free odds-to-percentage calculators.  I recommend visiting  They have an easy to use and free odds calculator.  You can also use Google and search betting odds to percentage calculators and see what you find.

After you have converted the money line odds to percentages, you now know what the market is saying about a fight.  You now know what percentage chance of winning each fighter has been assigned by the MMA fan base.  The next step is to assign your own percentages to each fighter’s chance of winning.  This is an art, and not a science, as there are no set rules or easy formulas.  And you are not looking for a single percentage point.  Predict using a range.  Your prediction is just an estimate and a range.  Instead of making silly predictions like a fighter will win this fight 73% of the time, you should be making predictions like this fighter will win this fight 65-75% of the time.  It is also acceptable to approximate.  For example, predicting that a fighter will win a fight around 90% of the time.  Assigning percentages to a fight (your own odds) is essentially just your opinion of a fight.  In part two of my book we go over predicting and breaking down fights, which is when you assign your percentages.  But for now just know that this is step two in the process.

At this point you have converted the money line odds into percentages and come up with your own predictions and percentages.  Now your job is to compare the percentage that the market (money line odds) is giving a fighter to win to your own chances you give that fighter to win.  If you see a large discrepancy between the market’s odds and your own, then you have a potential bet.  That is the entire handicapping process. Now let’s examine a couple questions about the handicapping process.

Why should I convert the odds into percentages and come up with my own?

Finding fights where your percentages differ greatly from the market’s is where you find your profit and make your money.  It is all about finding bargains, and this is where value investing comes into play.  Warren Buffett made his billions by buying up stocks when they were being undervalued by the market.   If he was confident that a company was worth $4 a share, but was being undervalued by the market and trading at $3 a share, then he would buy up the stock and wait for the market to come to its senses.  In this case, Buffett was buying up whole dollars for seventy five cents.  If you do this over and over you will show a big profit.

For an MMA example, consider this.  When Cain Velasquez fought Brock Lesnar his odds to win were +145.  The market was saying Cain’s chances to beat Lesnar were 41%.  I had Cain’s chances to win more around 90%.  I believe Cain would win this fight nine times out of ten, while the market, the general MMA fan base, believed Cain would only win this fight four times out of ten.  So what did I do?  I bet Cain huge and made a great profit.  Emulating Mr. Buffett, I had found a bargain where I could buy ninety cents for forty cents.  I was buying at a discount.  I believed I was taking a ten percent risk and while getting compensated for taking a sixty percent risk.  So why were most MMA fans so wrong going into this fight?  Cain was not a star yet, and many fans had not seen him fight.  Lesnar, on the other hand, was a star and had a lot of hype around him.  Fans were undervaluing Cain, while over valuing Lesnar.  Their incorrect valuations of each fighter’s skills were reflected in the money line odds.  Betting on MMA is all about finding situations where you can get large rewards while only taking small risks.  It is about finding bargains and buying at a discount, just like Warren Buffett.

Should I bet when my odds are the same as the money line odds?

No, betting on fights when your odds are the same as the house’s is equivalent to giving your friend four quarters for a one dollar bill.  There is no profit to be gained in this situation.  Over the long run you will break even.  Say Lyoto Machida is fighting Ryan Bader and his odds to win are -400, which convert to eighty percent.  If you also believe Machida’s chances to win are eighty percent, then there is no point in betting.  You are taking a twenty percent risk, and getting compensated for taking a twenty percent risk.  In the long run, you will show no profit for making these kinds of bets.  Do not place bets when your odds are the same as, or close to, the money line odds.  This will often be the case because most of the time the general MMA fan base is correct about each fighter’s chance to win a fight.

How do I set my own odds?

You simply ask yourself how many times out of ten do I think this fighter wins this fight?  If Anderson Silva is fighting Yushin Okami and you think Silva wins the fight eight times out of ten, then you are giving him an eighty percent chance to win the fight.  Predict using a range.  Coming up with odds down to one percentage point is silly and a waste of time.  A range of five to ten percentage points is preferred.  Predicting fights and assigning percentages is a skill.  I go over how to break down and predict fights in a part two of the book.

How big of a difference, between my odds and the money line odds, does there need to be in order for me to place a bet?

There is no easy answer to this question.  It comes down to your own preference and why you are betting on fights.  I recommend, and believe it is most profitable, to have a large margin of safety between your odds and the market’s odds.  The term margin of safety comes from the creator of value investing, Benjamin Graham.  When he invested his and other people’s money, he wanted as little risk as possible.  He looked for big margins of safety, large differences between his valuations of companies compared to the market’s valuations.  He believed in a large margin of safety because it reduced risk.  Lots of things can go wrong when you invest in stocks or bet on MMA fights.  In both endeavors you can get unlucky or simply be wrong.  Lots of things can go wrong in MMA.  Lucky, fluke knockout punches sometimes land.  Fighters can come into a fight injured, and they can also sustain injuries during the fight.  Referees make bad calls and judges make bad decisions.  A fight being fixed is always a possibility, albeit a microscopic one.  And finally, sometimes we are just wrong about our prediction.  The larger the margin of safety you have when placing a bet, the more you can protect yourself against these risks.

I prefer a large margin of safety.  Sometimes for a fight there might be a thirty percent difference between my odds and the money line odds.  Other times there will be a fifty percent difference.  The minimum margin of safety I will bet with is around a twenty percent difference.  My motivation for betting on MMA is to make a lot of money, while taking only small risks.  All I want to do is make money in a low risk fashion.  I have no need to have action on a UFC card in order to make it interesting.  Being an MMA fan, I enjoy the fights regardless of whether I have bets going.  For me, the pain of losing money hurts worse than the good feelings I get from winning money.  I like finding very large discounts between my odds and the market’s odds, and firing big when I find them.  Why take lots of risks and buy dollars for eighty-five cents over and over, when you can be patient and fire big on low risk opportunities where you can buy dollars for fifty and sixty cents?  That is how I like to do it.

But some people are not betting purely for profit, and they like the action.  If the money is not a primary concern to them and they want the action, but they want to be betting in a profitable way, then they can bet on all the fifteen and twenty percent differences they see.  I do not recommend betting often with such small margins of safety.  Maybe you are not as good at handicapping as you think you are.  Maybe if you bet a lot when the difference between your odds and the money line odds are only fifteen or ten percent, you will end up losing money because your handicapping is wrong too often.  The larger the difference is between your odds and the money line odds, the more slack you give yourself in case you are wrong and your handicapping abilities are not as good as you think they are.

I recommend waiting around for big margins of safety and then betting those fights big.  Big margins of safety, big differences between your odds and the money lines odds, represent low risk, high reward opportunities, which are the best kind of opportunities.  I refer to this strategy as big game hunting.  If, like myself, your only goal is to make large profits while taking small risks, then only bet when you have big margins of safety.  In appendix A of my book, I give two examples of big game hunting and show just how low risk and high reward they can be.

How much should I bet?

There is no easy answer to this question either.  It is entirely dependent on who is asking and what their goals are.  If someone was trying to make a living from betting on MMA, or if someone was running an investment fund based on betting on MMA, then it would be important to talk about bankroll management.  But I am going to make the assumption that everyone reading this article is just gambling on MMA recreationally and wants to make some money from one of their hobbies.

If you fall into this group, the recreational MMA bettor, then you do not need to worry about bankroll management.  Of course, always gamble responsibly, and if you cannot afford to be betting on MMA fights, then don’t.  My advice in regards to bet sizing is to not waste money betting on fights with small margins of safety.  Save your betting money for the fights with large margins of safety, the fights that offer low risk, high reward opportunities.  These fights do not come along often, so when they do, bet big.  Be responsible with your money, do not bet what you cannot afford to lose, but when these low risk, high reward fights come along, I recommend taking full advantage of them by betting as big as you are comfortable with.  You will get unlucky from time to time and lose fights because of cuts, bad judging decisions, fluke knockouts, or simply because your prediction was wrong.  But over the long run, if you big game hunt and bet on fights only with large margins of safety, then you should not be losing many bets.  If you find yourself losing many bets and lots of money, then you are probably not a skilled MMA bettor, and you need to stop betting on fights immediately.


Jason Rothman is president of Rothman MMA Consulting and the author of the book “Betting on MMA.”  For more on MMA betting check out his website at


About Jeff Fox

Jeff Fox is Mr. Manifesto - the Supreme Leader and evil mind behind The Hoops Manifesto, The MMA Manifesto, & A Dry Heat.