An odd is a price and a probability at once. Once you see that, you stop sorting odds into high and low and start asking whether the price matches what you think will happen.
From odds to probability
With decimal odds there is one formula: probability = 1 / odds. Odds of 2.00 imply 50%. Odds of 1.50 imply 66.7%. Odds of 5.00 imply 20%.
We say "imply" because this is not the true chance of the event. It is the chance that would be right if the bookmaker kept nothing for itself. It does keep something.
The margin
Take a match priced 2.10 for the home side, 3.40 for the draw and 3.60 for the away side. The implied probabilities are 47.6%, 29.4% and 27.8%. They add up to 104.8%. The three outcomes together must be 100%, so the extra 4.8 points are the margin (the overroundi).
How to remove it
The simplest way is to spread the margin proportionally: divide each implied probabilityi by the total. In the example that gives 45.4%, 28.1% and 26.5%, and fair oddsi of 2.20, 3.56 and 3.77.
More elaborate methods exist. The proportional one is the most common and is enough to compare prices. Try your own numbers in the margin calculator.
Why the bookmaker matters
Margins differ a lot. Sharpi books such as Pinnacle, and exchanges like Betfair, work on thin margins. Most retail bookmakers charge noticeably more, especially on side markets. The bigger the margin, the harder it is to come out ahead over time, even with good estimates.
That is why our model compares the price it finds with the fair price of a sharpi market when one exists. If the price does not beat it, we do not play.