22 min readPolymarket Odds Guide: Understanding & Converting Betting Odds
Understanding odds is fundamental to successful trading on Polymarket. Unlike traditional sportsbooks that use American or decimal odds, Polymarket displays probabilities directly as share prices. This guide explains everything about Polymarket odds, from basic concepts to advanced analysis techniques that help you find profitable opportunities.
What You'll Learn
- How Polymarket displays odds as share prices
- Converting between odds formats (American, decimal, fractional)
- Understanding implied probability and edge
- Finding value when odds are mispriced
- Advanced techniques for odds analysis
- Tools to track and compare odds
- Common patterns and what they mean
- Practical examples with real market scenarios
How Polymarket Odds Work
Polymarket uses a simple, elegant system: share prices represent probabilities directly. A 65¢ share implies a 65% probability. No complex conversions needed—what you see is what you get.
The Price-Probability Relationship
Every Polymarket share costs between $0.00 and $1.00. When a market resolves, winning shares pay exactly $1.00, and losing shares become worthless. This creates a direct mapping between price and probability:
Implied Probability = Share Price × 100%
Example: If Yes shares cost $0.72, the market implies a 72% chance the event will happen.
Yes and No Shares
Every binary market has two types of shares: Yes and No. Their prices are complementary— they should approximately add up to $1.00 (the small difference is the spread).
| Yes Price | No Price | Implied Yes % | Implied No % |
|---|---|---|---|
| $0.90 | $0.10 | 90% | 10% |
| $0.65 | $0.35 | 65% | 35% |
| $0.50 | $0.50 | 50% | 50% |
| $0.25 | $0.75 | 25% | 75% |
| $0.08 | $0.92 | 8% | 92% |
Why This System is Better
Polymarket's probability-based pricing offers significant advantages:
- Intuitive: No mental math—65¢ means 65% probability
- Tradeable: Shares can be bought and sold before resolution
- Transparent: No hidden vigorish or house edge in the odds
- Market-driven: Prices reflect collective trader wisdom
Converting Between Odds Formats
If you're familiar with sports betting odds, here's how to convert to and from Polymarket's probability format.
American Odds Conversion
American odds show how much you win on a $100 bet (positive) or how much you need to bet to win $100 (negative).
Formulas:
Positive American → Probability: 100 / (American + 100)
Negative American → Probability: |American| / (|American| + 100)
Example: +300 odds = 100 / 400 = 25% = $0.25 on Polymarket
Example: -200 odds = 200 / 300 = 66.7% = $0.67 on Polymarket
Decimal Odds Conversion
Decimal odds show your total return per dollar bet (including your stake).
Formula:
Probability = 1 / Decimal Odds
Example: 2.50 decimal odds = 1 / 2.50 = 40% = $0.40 on Polymarket
Example: 1.25 decimal odds = 1 / 1.25 = 80% = $0.80 on Polymarket
Fractional Odds Conversion
Fractional odds (common in UK) show profit relative to stake.
Formula:
Probability = Denominator / (Numerator + Denominator)
Example: 3/1 odds = 1 / (3 + 1) = 25% = $0.25 on Polymarket
Example: 1/4 odds = 4 / (1 + 4) = 80% = $0.80 on Polymarket
Complete Conversion Table
| Polymarket | American | Decimal | Fractional | Probability |
|---|---|---|---|---|
| $0.05 | +1900 | 20.00 | 19/1 | 5% |
| $0.10 | +900 | 10.00 | 9/1 | 10% |
| $0.20 | +400 | 5.00 | 4/1 | 20% |
| $0.33 | +200 | 3.03 | 2/1 | 33% |
| $0.50 | +100 | 2.00 | 1/1 (evens) | 50% |
| $0.67 | -200 | 1.50 | 1/2 | 67% |
| $0.80 | -400 | 1.25 | 1/4 | 80% |
| $0.90 | -900 | 1.11 | 1/9 | 90% |
| $0.95 | -1900 | 1.05 | 1/19 | 95% |
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Understanding Your Potential Returns
Your profit on Polymarket depends on the price you pay and the outcome. Here's how to calculate returns at different entry prices.
Calculating Profit
Formulas:
Profit per share (if correct) = $1.00 - Entry Price
Loss per share (if wrong) = Entry Price
Return % (if correct) = (Profit / Entry Price) × 100
Example: Buy at $0.40
If correct: $0.60 profit per share (150% return)
If wrong: $0.40 loss per share (100% loss)
Return Table by Entry Price
| Entry Price | If Correct | Return % | Equivalent Decimal |
|---|---|---|---|
| $0.05 | +$0.95 | +1900% | 20.00 |
| $0.10 | +$0.90 | +900% | 10.00 |
| $0.20 | +$0.80 | +400% | 5.00 |
| $0.30 | +$0.70 | +233% | 3.33 |
| $0.40 | +$0.60 | +150% | 2.50 |
| $0.50 | +$0.50 | +100% | 2.00 |
| $0.60 | +$0.40 | +67% | 1.67 |
| $0.70 | +$0.30 | +43% | 1.43 |
| $0.80 | +$0.20 | +25% | 1.25 |
| $0.90 | +$0.10 | +11% | 1.11 |
Finding Value in Odds
The key to profitable trading is finding markets where the price doesn't accurately reflect the true probability. This is called "finding value" or "positive expected value (EV)."
The Value Formula
A bet has positive expected value when your estimated probability exceeds the implied probability from the market price.
Expected Value Formula:
EV = (Your Probability × Payout) - (1 - Your Probability × Stake)
Or simplified for Polymarket:
EV per dollar = Your Probability × (1 / Price) - 1
Example: Market price is $0.40 (implies 40%). You believe true probability is 55%.
EV = 0.55 × ($1.00 / $0.40) - 1 = 0.55 × 2.5 - 1 = 0.375
You expect to make $0.375 per dollar wagered over time—a +37.5% edge.
Spotting Mispriced Markets
Markets can be mispriced for several reasons:
- Information lag: News hasn't fully been priced in yet
- Emotional trading: Fear or greed creating overreaction
- Illiquidity: Not enough traders to correct the price
- Complexity: Hard-to-analyze markets attract less smart money
- Recency bias: Overweighting recent events vs. base rates
The Edge Threshold
Most professional traders look for at least a 5-10% edge before committing capital. Here's how that translates at different price points:
| Market Price | 5% Edge Target | 10% Edge Target |
|---|---|---|
| $0.20 (20%) | You believe 25%+ | You believe 30%+ |
| $0.40 (40%) | You believe 45%+ | You believe 50%+ |
| $0.60 (60%) | You believe 65%+ | You believe 70%+ |
| $0.80 (80%) | You believe 85%+ | You believe 90%+ |
Multi-Outcome Market Odds
Many Polymarket markets have more than two outcomes—for example, "Who will win the election?" with 5+ candidates. These markets have unique odds dynamics.
Sum of Probabilities
In a multi-outcome market, all outcome prices should add up to approximately 100%. If they add up to more, there's potential arbitrage. If less, there's unusual value somewhere.
Example: "Next Fed Chair"
Candidate A: $0.45 (45%)
Candidate B: $0.30 (30%)
Candidate C: $0.15 (15%)
Candidate D: $0.08 (8%)
Others: $0.05 (5%)
Total: 103% — slightly over 100%, which is normal due to spreads
Correlation Between Outcomes
Outcomes in multi-candidate markets are inversely correlated—when one rises, others typically fall. Understanding these relationships helps with portfolio construction.
- Direct competition: If A rises, B often falls
- Grouped outcomes: Multiple candidates from same party may move together
- Event dependencies: Dropping out of one candidate benefits others
Long-Shot Odds in Multi-Outcome Markets
Low-probability outcomes in multi-outcome markets offer asymmetric returns but require careful analysis:
| Price | If Wins | Consideration |
|---|---|---|
| $0.02 (2%) | +4900% | Lottery ticket—probably won't hit |
| $0.05 (5%) | +1900% | Outsider with a real path |
| $0.10 (10%) | +900% | Dark horse—worth research |
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Odds Movement Analysis
Tracking how odds change over time provides valuable trading signals. Here's how to interpret different patterns.
Sharp vs. Soft Movement
Not all price movements are equal. Understanding who's moving the market helps you decide whether to follow or fade the move.
| Sharp Movement | Soft Movement |
|---|---|
| Large single trades | Many small trades |
| Often precedes news | Often follows news |
| Likely informed trading | Likely reactive/emotional |
| Usually don't fade | Can fade extreme moves |
Common Patterns
Watch for these recurring patterns in market odds:
- Pre-event drift: Gradual movement toward correct outcome in days before resolution. Markets often "figure it out" slowly.
- Event spike: Rapid movement during live events. First movers capture most of the edge.
- Overreaction and reversion: Initial moves often overshoot, then correct. Patience can pay.
- Support and resistance: Prices often bounce at round numbers (50%, 75%) or historical levels.
Volume-Price Relationship
Volume often confirms or questions price moves:
- High volume + price move: Move likely sustained (conviction)
- Low volume + price move: Move may reverse (weak hands)
- Rising volume at resistance: Breakout likely
- Declining volume at support: Breakdown possible
Polymarket vs. Sportsbook Odds
How do Polymarket odds compare to traditional sportsbooks? The differences are significant.
The Vigorish Difference
Sportsbooks build profit margin ("vig" or "juice") into their odds. Polymarket has no such built-in margin—you trade peer-to-peer.
Example: 50/50 Event
Sportsbook: Team A at -110, Team B at -110
Both imply 52.4% probability → Total 104.8% → 4.8% vig
Polymarket: Yes at $0.50, No at $0.50
Both imply 50% → Total 100% → 0% vig (only small spread for liquidity)
Why Polymarket Often Has Better Odds
- No house edge: All value goes to traders, not the platform
- Market efficiency: Competition among traders drives accurate pricing
- Exit liquidity: Can sell positions before resolution
- Price discovery: Market-driven odds, not bookmaker judgment
When Sportsbooks Might Be Better
- Deep liquidity: Major sports markets often more liquid at sportsbooks
- Promotions: Free bets, odds boosts can add value
- Regulation: Licensed, insured, established dispute resolution
- Fiat simplicity: No crypto required
Tools for Odds Analysis
Several tools can help you analyze and track Polymarket odds more effectively.
PolyTrack
PolyTrack provides real-time market data and whale tracking:
- Live odds across all markets
- Historical price charts
- Large trade alerts ("whale watching")
- Market comparisons and analysis
Polymarket Native Charts
Polymarket's built-in features include:
- Price charts with multiple timeframes
- Volume indicators
- Order book depth visualization
- Trade history
Third-Party Analytics
Other tools in the ecosystem:
- Polygon block explorers for on-chain analysis
- Portfolio trackers for managing positions
- Spreadsheet integrations for custom analysis
- API access for automated monitoring
Practical Examples
Let's walk through some real-world scenarios to apply these concepts.
Example 1: Election Market Analysis
Scenario: "Will Candidate X win?" trading at $0.35
Analysis:
- Implied probability: 35%
- Potential return if wins: +186%
- Polls show 40% support
- Historical polling error suggests range of 35-45%
Assessment: If you believe true probability is 40% based on polling, this offers +5% edge. However, polls have uncertainty. Only bet if you're confident the market is underpricing.
Example 2: Crypto Price Market
Scenario: "Will BTC hit $100K by June?" trading at $0.60
Analysis:
- Implied probability: 60%
- Current BTC price: $95,000
- Needs +5.3% move to resolve Yes
- Historical volatility suggests this is achievable
Assessment: Price implies high confidence. Consider if 60% truly reflects probability of hitting $100K. If you think it's lower (50%), No shares at $0.40 offer better value.
Example 3: Live Event Trading
Scenario: Sports championship, Game 7, halftime score tied
Analysis:
- Pre-game: Team A was $0.55 favorite
- At halftime: Both teams at $0.50
- Home court advantage for Team A
- Team A's star player heating up
Assessment: Market now prices as coin flip. If you believe Team A's home advantage and player performance suggest 55%+, buying at $0.50 offers value. But be quick—live markets move fast.
Common Mistakes with Odds
Avoid these frequent errors when analyzing Polymarket odds:
Ignoring Base Rates
How often does this type of event typically occur? If incumbents historically win 75% of elections, a challenger at $0.40 may be fairly priced even if they look strong.
Overconfidence in Personal Judgment
Markets aggregate many opinions. If you think a market is obviously wrong, you're claiming to know better than the collective. Sometimes you do—often you don't.
Confusing Recent Trends with Probability
A price rising from $0.30 to $0.50 doesn't mean it will keep rising. Each price level reflects new information. The move already happened—future moves are not guaranteed.
Neglecting Resolution Risk
Markets with ambiguous resolution criteria carry extra risk. Even if your probability assessment is correct, unclear rules might lead to unexpected outcomes.
Chasing Long Shots
Low-priced outcomes are cheap for a reason—they probably won't happen. Don't treat prediction markets like lottery tickets. The expected value of most long shots is negative.
Frequently Asked Questions
Why don't Yes and No prices add up to exactly $1.00?
The difference is the bid-ask spread, which provides liquidity. In active markets, the spread is small (1-2¢). In illiquid markets, it can be larger. The spread also prevents perfect arbitrage opportunities.
Do Polymarket odds predict outcomes accurately?
Research shows prediction markets are well-calibrated. Events priced at 70% happen about 70% of the time. This doesn't mean every prediction is correct—it means the probabilities are accurate on average.
Can whales manipulate odds?
Large traders can temporarily move prices, but maintaining manipulation is expensive. If someone pushes a price away from true value, other traders can profit by trading against them. Manipulation typically doesn't persist in liquid markets.
Should I always take the best odds available?
Not necessarily. Better odds usually come with trade-offs—less liquidity, longer resolution time, or more ambiguous criteria. Consider the full context, not just the price.
How do fees affect effective odds?
Most Polymarket markets have no trading fees. Some markets (like 15-minute crypto) have taker fees around 1-2%. Factor this into your analysis—a $0.50 share with 2% fee costs effectively $0.51 and reduces expected value.
What's a good minimum edge to trade?
Professional traders typically look for 5-10% edge. With smaller bankrolls, you might need higher edges to justify risk. Never trade without any perceived edge—you're just gambling.
How do I calculate odds on multi-outcome markets?
Sum all outcome prices to check for arbitrage (over 100% means arb opportunity). Convert each individual price to probability the same way: price × 100 = implied %. Remember that only one outcome pays out.
Why do some markets have very different odds than polls?
Markets incorporate more information than polls—enthusiasm, turnout estimates, historical accuracy of polls, late-breaking trends. Markets also adjust instantly while polls have lag. When they disagree, markets are often more accurate.
Can I use Polymarket odds for portfolio hedging?
Yes. If you have real-world exposure to an event, you can use Polymarket to hedge. Own crypto? Buy "Will BTC fall below $X" as insurance. Worried about election outcome affecting your job? Hedge with political markets.
How often should I check odds?
Depends on your trading style. Day traders watch constantly. Position traders might check daily. For long-term markets, weekly review is often sufficient. Obsessive checking rarely improves results and can lead to overtrading.
The Psychology of Odds
Understanding how psychology affects odds perception helps you avoid common traps.
Probability Blindspots
Humans are notoriously bad at processing probabilities. We overweight dramatic outcomes, struggle with small probabilities, and let emotions color our assessments.
- Availability bias: Recent events feel more likely than they are
- Wishful thinking: We overestimate outcomes we want to happen
- Anchoring: First prices we see influence subsequent estimates
- Round number bias: We perceive 50% and 75% as more meaningful than 52% or 73%
Emotional Discipline
Successful traders maintain emotional distance from their positions:
- Don't trade markets where you have strong personal preferences
- Stick to pre-determined position sizes regardless of excitement
- Accept that losing trades are part of the process
- Review decisions based on process, not outcomes
Timing Your Odds Analysis
When you analyze matters as much as how:
Best Times to Analyze
- Before major events: Odds often drift correctly in final hours
- After market opens: Morning liquidity often reveals true sentiment
- During low volatility: Calmer markets price information more accurately
- When you're rested: Tired analysis leads to poor decisions
Times to Avoid Trading
- Immediately after surprising news (wait for dust to settle)
- When you're emotional about recent wins or losses
- Late at night when judgment is impaired
- When trying to "make back" recent losses
Related Resources
Continue learning about Polymarket:
- Polymarket Explained - Complete platform overview
- Polymarket Betting Guide - Strategies and bankroll management
- Polymarket Tutorial - Step-by-step getting started
- Predictions Hub - All market categories
- Whale Tracking Guide - Follow large traders
Mastering Polymarket odds is the foundation of profitable trading. The probability-based pricing system is intuitive once you understand it, and it eliminates the confusion of traditional odds formats. Focus on finding genuine edge—situations where your assessment of probability exceeds the market price—and you'll be well-positioned to profit over time. Use tools like PolyTrack to track odds movements and whale activity, and always remember that the goal is long-term expected value, not winning every trade.
Frequently Asked Questions
Polymarket displays odds as probability. A $0.65 share means 65% implied probability. If correct, you receive $1. Your return = ($1 - price) / price. At $0.65, profit is $0.35 per share (54% return).
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