Probability is generally described as the potential or likelihood that something will or will not occur. To have confidence in a statement of probability, you should have a strong belief in the logic and mathematical support for it. Probability is used to make decisions ranging from personal or family activities to gambling wagers and high level business decisions. For instance, families may opt out of a planned camping trip if the weatherman forecasts a 70 percent probability of rain. Gamblers are often aware of the mathematical probability that they will win a given game or unique play. Business leaders take calculated risks based on expected probability of an impacting event or occurrence.
Mathematical expressions of probability are typically given as percentages, as in the previous example about the weather, or as a ratio comparing the potential of an expected outcome against the total possibilities. If a basketball player shoots 50 percent on a given shot, you might safely predict a 1 in 2 chance that he makes the next shot. Literally, this expression means it is highly probable that if he takes two shots, he will make one.
Odds are a specific type of probability in which the potential of one occurrence is stated against the potential of another. Odds help express the potential that one event takes place versus others. As an example, you could say the odds of it raining in the weather example are 7 to 3, as opposed to saying the probability of rain is 70 percent.
Expressing odds establishes a basis for wagers. Take the basketball player who shoots 50 percent. His odds of making the next shot are "even," because he has the same mathematical potential to make the next shot as he does to miss it. Saying a horse has 2 to 1 odds of winning is the same as stating he has a 1 in 3 chance, since 1 is the expectation of a win and 3 is the total possible opportunities. Saying a horse has 2 to 3 odds is like saying in five races, you would expect him to win three and lose two. A bet against high odds pays more because of the risk. A $10 bet on a 20 to 1 horse returns $200.