Betting Margins Explained
All bookmakers build margins into the markets they take bets on, in order to (hopefully) guarantee themselves a profit.
Therefore, as a punter if you have the ability to calculate betting margins using a simple formula, then you can easily identify which bookies are offering you the best odds.
The “True Odds”
The best way to explain how this works is using the classic coin toss scenario. In any coin toss the probability of heads is 50% and tails is 50%. So the true odds for both outcome is evens (2.0). 50% + 50% = 100%. Making this a fair, or “round” market.
However, if a bookmaker offered the above true odds on a coin toss and took an equal amount of money on each outcome, they would just break even and not make any money. For example, if they took £100 on heads and £100 on tails, at these odds of evens (2.0) they would be paying out £200 regardless of the result, meaning a profit of £0.
Therefore, bookmakers will offer lower odds than the true odds in order to build in a profit margin. Keeping with the coin toss example, a bookmaker might instead offer odds of 10/11 (1.91) on both heads and tails outcomes. This is now implying that both have a 52.36% probability of being the correct outcome. 52.36% + 52.36% = 104.72%, making this an “overround” market, where the bookmakers margin is 4.72%.
So now if they took £100 on heads and £100 on tails, at these new odds of 10/11 (1.91), and the result is heads, the bookie would pay out £191 (£100 x 1.91) on heads and be left with £9 profit. Likewise, if the result is tails they would pay £191 out on tails and still have a £9 profit.
Now bookmaking is a business, so it’s fair enough that the bookies have their margins, however as punters we should always be looking for the best value for our money, and by this we mean the betting sites that have the lowest margins and offer as close to the true odds as possible.
Example:
Let’s compare the odds offered by Skybet and bet365 for the Tottenham v Man Utd match.
Skybet are offering: Tottenham 5/4 (2.25), Draw 12/5 (3.4), Man Utd 23/10 (3.3)
bet365 are offering: Tottenham 69/50 (2.38), Draw 121/50 (3.42), Man Utd 23/10 (3.3)
To calculate each bookies margin here we make the following calculation using the decimal odds:
Skybet: 100/2.25 + 100/3.4 + 100/3.3 = 104.16%
bet365: 100/2.38 + 100/3.42 + 100/3.3 = 101.56%
From this simple calculation we can see that skybet’s margin is considerably bigger on this match than bet365, so bet365 are the best value by a long way! If you do this for every Premier League match (as we do over on our Premier League Margins page) you will be able to see the bigger picture, and which bookies consistently offer the best value for money.
This formula can be used on any market in any sport. Remember, the lower the bookies margin the better value it is to you!
You might also be interested in:
Top 20 Betting Offers
New customers only. Register, deposit with Debit Card, and place first bet £10+ at Evens (2.0)+ on Sports within 7 days to get 3 x £10 in Sports Free Bets & 2 x £10 in Acca Free Bets within 10 hours of settlement. 7-day expiry. Eligibility exclusions & T&Cs Apply. | |||||
18+ New UK+ROI Customers only. Certain deposit methods & bet types excl. Min first £5 bet within 14 days of account reg at min odds 1/2 to get 6 x £5 free bets (selected sportsbook markets only, valid 7 days, stake not returned). Restrictions + T&Cs apply. | |||||
New Customers Only. To qualify, deposit and place a minimum £10 bet on any sport. Then, place two additional qualifying bets, each worth at least 50% of your largest initial stake. Quinnbet will credit your account with a Free Bet up to £25, the following day 18+ T&Cs Apply. Gamble Responsibly. | |||||
18+ New customers only. Opt in, deposit & bet £10 (odds 2.00+) within 7 days of registration. Get £30 in Free Bets for selected markets, 7 days expiry. T&Cs apply, see below. gambleaware.org | Please gamble responsibly | |||||
18+ | New players only. Opt-in. Min deposit is £20. Offer: Place a £20 sports cash bet at minimum odds of 3/4 (1.75) or higher and receive a £20 Free Bet. Free bet credited upon settlement of all qualifying bets. Full terms apply. | BeGambleAware.org. | |||||
18+. New customers only. Opt in required. Minimum bet of £20 on any selections. Min odds of evens (2.00). Pre-game only. Free bet awarded upon settlement. Free bet split into 4 x £5 Free Bets. Free bet expiry 24 hours. Other free bet terms apply. Maximum pay-outs apply. GamCare.org.uk | UK only. Full T&Cs apply. #ad | |||||
New customers online only. Register and bet a min £/€5 at odds of 1/1 (2.0) or greater across sports or racing within 7 days of registration to qualify. Receive £/€10 Tote Credit, £/€10 Free Sports Bet within 48 hours of qualifying bet settlement. Qualifying bet is the first racing pool or sports bet added to bet slip. Voided/non-runner bets will not qualify; subsequent bet will be qualifying bet. 7-day expiry. 18+. One per customer. Selected customers only. Full T&Cs apply. Gambleaware.org.Full T&Cs apply. | |||||
18+ New UK + ROI customers only. Certain deposit methods & bet types excl. Min first £/€5 bet within 14 days of account reg at min odds 1/2 to get 6 x £/€5 free bets (selected sportsbook markets only, valid 7 days, stakes not returned). Restrictions + T&Cs apply. | |||||
18+ New customers only. Place a £10+ bet at min odds 1/1 (2.0) within 14 days of sign-up. Get £30 in Free Bets, valid for 7 days on selected bets only. Free stake not returned with winnings. T&Cs apply. BeGambleAware.org | |||||
18+ New customers only. Opt in, deposit and bet £10 on any sports market at 1/1+ odds within 7 days of sign up. Get 3x£10 in Free Bets for set sports markets. Free Bets expire in 7 days. Scroll for T&Cs. GambleAware.org | Please gamble responsibly | |||||
*New members only. £10+ bet on sports (ex. Virtuals) 1.5 min odds, settled within 14 days. Free Bets: accept in 7 days, valid 7 days; £20 use on sportsbook, £10 on Bet Builder. Stake not returned. T&Cs + deposit exclusions apply. Bet Responsibly. GambleAware.org. 18+ | |||||
New members only. £10+ bet on sports (ex. virtuals) at 1.5 min odds, settled within 14 days. Free Bets: accepted in 7 days, valid 7 days; £20 use on sportsbook, £10 on Bet Builder. Stake not returned. T&Cs + deposit exclusions apply. Bet Responsibly. GambleAware.org. 18+ | |||||
Place a £10 fixed odds single or £10 each-way bet at minimum odds of 1/2 and get 3 x £10 free fixed odds bets, 3 x £5 Total Goals football spread bets and 3 x £5 Winning Favourites spread bets and a £1 racing Race Index spread bet. 18+ www.gambleaware.org. | |||||
*New customers only. Place a min £10 pre-event bet at min odds of 2.0. £40 worth of Free Bet Tokens awarded on bet settlement. 4 x £10 each with betting restrictions. 7 day expiry. Debit Card deposits only (exclusions apply). 18+ GambleAware.org. Bet The Responsible Way Full Terms apply | |||||
New customers. Bet £40+ at odds 2.0 (evens) or greater, with code BET40GET20, get 2×£10 Free Bets. Free Bets must be placed at min odds 4/1 (5.0) or greater, paid after settlement and 24h later, expire in 24h. Full T&Cs apply. GambleAware.org | |||||
18+| GambleAware.org. New GB customers only. Opt in, deposit and Bet £20+ on sports at min odds of 2.0+ (1/1) for £40 in Free Bets within 7 days of registration. Debit cards or instant bank transfers only. Free bets expire within 7 days of issue. Geographical restrictions and T&C’s apply. | |||||
Offer valid for new Betgoodwin customers aged 18 years and over. Min qualifying stake £10 at odds of 6/4+. Excludes horse & greyhound racing. Min 4 legs at odds of 2/5+ for £10 free acca. Full Terms apply. begambleaware | |||||
New customers only. Min £20 bet at minimum odds of 1/1 (2.0). Max reward: Two £10 Bet Builder Free Bets. Each Bet Builder Free Bet requires a minimum of 4 legs at combined minimum odds of 3/1 (4.0). Free Bets expire 7 days after credit. 18+. Full T&Cs apply. | |||||
New UK customers. Place a £10 real money bet at min. 2.0 odds within 5 days of deposit. Get 4 x £10 Free Bets: 1 Single, 2 Accas & 1 Bet Builder (min. 3 selections each). Excludes cashout, E/W, Multis, Ineligible Markets & Odds Boosts. Credited after bet settlement. 7-day expiry. T&Cs apply. | |||||
New customers only. To qualify for free bets, the new user must place and settle £20 on easyBet markets. The user must bet on at least 2 different events to qualify. The user must place and settle bets at odds of 2.0 or more. An event is classed as two different sporting events. Bets can be placed on singles, multiples and Bet Builders. The user must place and settle bets before the closing date of the promotion to qualify. Users making their first deposit by Skrill, Neteller or PaySafe card will not qualify for this promotion. T's and C's Apply. Be Gamble Aware. 18+ |
