# ROI Calculator or Return On Investment Calculator

The ROI Calculator or Return On Investment Calculator helps you measure the efficiency of an investment or our case, a bet. The ROI calculator essentially takes the projected gains from a bet and divides it by the total cost of the bet to come up with a percentage representing the ROI for that wager. This may help you evaluate which bets to place based on the return you are looking for. You are going to need to know a few things before you start: first determine the amount you expect to wager. Next you want to determine the likelihood of winning the bet. This can be your personal feeling on the bet or you can try the Fair Odds Calculator to determine the implied probability of a bet with the vig or juice removed. There is no sense in entering the implied probability from the actual odds, because the ROI calculator will return a 0% rate of return. The final step is to enter the American odds:

## How the ROI Calculator works

Calculating ROI is actually one of the easier ones, especially if you are familiar with implied probability. Let’s work through a quick example. You are going to place a $100 spread bet at -110 odds. Though the odds for both sides of the bet indicate it is 50/50, you know that your long term winning percentage on spread bets is 55%. What the ROI calculator is going to indicate to us is the ideal outcome, over the long term, of a bet like this. Here are the steps for calculating:

## 1) Calculate the Implied Probability

This one is pretty easy. To cheat, please use the Implied Probability Calculator

Implied Probability = (-1*(Odds)) / (-1(Odds) + 100)

Which looks like:

Implied Probability = (-1*(-110)) / (-1(-110) + 100)

or:

52.4% or 0.524 = 110 / 210

## 2) Calculate the expected average Winnings

This one is easier than it sounds. First we need the decimal odds:

Decimal Odds = 100 /(-1 * Odds) + 1 *(for negative odds) *

1.9091 = 100 / (-1*-110) + 1

Then we plug them into this equation

Winnings = Decimal Odds * Probability of Winning / 100 * Bet

or:

$114.60 = 1.9091 * 60% / 100 * $100

## 3) Calculate the ROI using the Winnings

All the hard work is done. Now we wimply get the ROI

ROI = Winnings / Bet – 1

ROI = $114.60 / 100 – 1

ROI = 0.146 or 14.6%

The advice that ROI is giving you, is if you should place a wager based on your estimated winning percentage. If your winning percentage is too low, then some favorite bets may not be worth the risk. The trick is always accurately predicting your estimated winning percentage.