Official documentation: implied probability and bookmaker overround

Implied probability is the chance of an outcome that a price assumes. The conversion is one line: for decimal odds, implied probability = 1 / odds, so decimal odds of 6.00 imply 1/6 ≈ 16.7%. For a prediction market contract that pays $1, the price isthe probability: a Spain contract at 17¢ implies a 17% chance Spain wins the 2026 World Cup. The overround is what makes bookmaker odds different: sum a bookmaker’s implied probabilities over all outcomes of one event and the total exceeds 100% — that excess is the bookmaker’s built-in margin, and it must be stripped before any fair comparison.

Conversion reference

Format	Example	Formula	Implied probability
Market price (per $1)	17¢	price itself	17%
Decimal odds	6.00	1 / 6.00	16.7%
Fractional odds	5/1	1 / (5/1 + 1)	16.7%
American odds (+500)	+500	100 / (500 + 100)	16.7%

Reference examples; market prices as of June 2026 are live on Polymarket and inside Prever.

What the overround is, precisely

The overround (also called vig, margin, or juice) is the amount by which a bookmaker’s implied probabilities sum past 100%. A two-outcome event priced at 52.4% and 52.4% has a book of 104.8%, i.e. a 4.8% overround — the bookmaker’s structural edge regardless of the result. Across a 48-team outright market like the 2026 World Cup winner, small per-team markups compound into a meaningfully inflated book, which is why naively reading bookmaker odds overstates every team’s chances at once.

To strip the margin, divide each implied probability by the book total: fair probability = implied / book sum. In the two-outcome example, 52.4% / 104.8% = 50% — the margin-free estimate. This one-line normalization is the minimum hygiene before comparing a bookmaker number to a prediction market price or a model output.

Why prediction market prices read differently

An order-book prediction market has no overround built into the price, because traders compete on both sides: if yes and no together cost more than $1, someone profits risk-free by selling the pair until they don’t. Costs are charged as explicit fees instead — as of June 2026, Polymarket charges a 0.75% taker fee on sports markets (makers pay nothing), Kalshi charges 0.07 × P × (1 − P) per contract (peaking around 1.75¢ at a 50¢ price), and Prever includes a 1% taker fee inside the order with no deposit or withdrawal fees. The practical consequence: a Polymarket price of 17¢ on Spain can be read directly as a ~17% market probability, while a bookmaker’s “Spain 5/1” needs the normalization step first.

Worked example: reading the 2026 favorites

As of June 2026, Polymarket’s World Cup winner market prices Spain at roughly 17% and France at roughly 16% — directly comparable, no adjustment needed. The Opta supercomputer’s simulations put Spain at 16.1% and France at 13.0%, also directly comparable because model outputs are already probabilities. Only the bookmaker column requires the overround strip before joining this comparison. Once everything is in the same unit, the interesting question becomes where the sources disagree — which is the subject of our market vs model guide.

Where this applies inside Prever

Every price Prever displays is a live Polymarket order-book price streamed over websocket, so every number you see is already an implied probability per stage of a team’s run — Groups through Champion. The allocation engine described in our methodology documentation consumes those probabilities together with money-on-it and return upside. If you want the gentler, screenshot-level version of this page, read how to read World Cup probabilities; to apply it, open the Road to Glory builder or check the history-derived angles on AI Picks. And after the final, evaluate any probability source with the scoring rules in Brier score and log loss.