An Advanced Primer on Parlays

It is not In the Bookmaker’s Best Interest for You to Limit Your Risk

Quick now, – is using parlay bets against pointspreads and totals a good idea or a bad idea?

    Hint: Have you ever known a bookmaker to advertise parlay bets?

It’s widely known that sportsbook executives and bookmakers never say good things about parlay bets. (We aren’t referring to parlay cards here. Parlay cards are by no means the same as legitimate parlay bets. Parlay cards are a breed unto themselves and not the same as parlays wherein 2-teamers pay 13-to-5 and 3-teamers pay 6-to-one.)

In fact, your friendly bookmaker often has several reasons why parlay bets are bad for you. Some bookmakers say they don’t take parlays because they want to protect the players!

Well………..consider what you already know: Many bookmakers severely limit the size of the parlay bets that they’ll accept. Some won’t accept parlays at all on the total and pointspread of the same game. Some won’t accept parlays on totals, period, and some even have the gall to pay off two-bet parlays at less than 13-to-5 and 3-bet parlays at less than 6-to-one…And no bookmaker is anxious to advertise the availability of parlay bets.

…If parlays are truly bad for sports bettors, why is all that true? If they’re bad for bettors, they must be good for bookmakers, – right? And if they’re good for bookmakers, doesn’t it figure that bookmakers would be promoting the use of parlay bets?…What’s wrong with that picture?

Try this question:      

TRUE OR FALSE?: A 3-bet parlay paying 6-to-1 costs less in vigorish than three separate bets risking 11 to win ten.

      It’s surprising how many veteran bettors will say that statement is false. Some beginners or non-gamblers even think the vigorish on a 3-bet parlay is as high as 12.5 percent.

      The statement is true. A 3-bet parlay paying 6-to-1 actually has slightly less vigorish charge than three separate bets wherein the bettor risks 11 to win ten. Here’s proof:

Assume a bettor lays $110 on a standard bet to win $100, and does win, and then re-bets the entire $210 on a second bet, and wins again. The payback on the second bet is $210 X 1.91 = $401. (You can quickly figure the correct payback on any ’11-10′ sports bet by multiplying the amount risked by 1.91)

      Now say he bets the entire $401 on yet a third bet and wins again. He gets back a total of $766: ($401 x 1.91 = $766).

     The bettor began by risking $110, he won all three bets, and he ended with $766. Had the same bettor risked the same $110 on the same three bets using a 3-bet parlay paying 6-to-1, he would have ended with $770; – the $110 originally risked plus $660 in winnings.

     So a 3-bet parlay paying 6-to-1 actually costs slightly less than three separate 11-10 bets. The cost on a 3-bet parlay paying 6-to-1 is about 4.35 percent. On a single 11-10 bet the cost is about 4.55 percent.

      Two-bet parlays paying 13-to-5 are slightly more expensive than laying 11 to win ten; – they cost 5.13 percent in vigorish.

Many beginners and non-gamblers think the cost of a 2-bet parlay is 10 percent. After all, the payoff is 2.6-to-one (13-to-5). Since there are 4 different possible outcomes of a 2-bet parlay, (WW, WL, LW, LL), four different bettors could each lay $100 on a different one of the four possible outcomes. The winner would walk away with $360; — his $260 in winnings plus the original $100 he risked – and since the bookmaker kept $40 of the total risked by the four different bettors ($400), it certainly can seem like a vigorish charge of 10 percent.  

…But its not. The four bettors actually risked a total of $782 in this situation, not $400. Note that two of the four bettors were fated to win the first bet. Two of the four bettors had to win the first bet, and when they did, their original $100 was then worth $191 (at 11-10 prices) which they then “automatically” risked on the second game of the parlay. There was $400 risked by the four bettors on the first game of the parlay, and $382 risked by two of the four bettors on the second game of the parlay. The bookmaker ultimately kept $40 of that $782…..5.1 percent.

If a bettor risked $100 on a single 11-10 bet, and won $91, and then re-bet the $191 on a second 11-10 bet, and won again, he would walk away with $365 – not $360. The $5 difference is the difference between 5.1 percent and 4.55 percent. That’s a significant difference, but not so expensive that we shouldn’t use 2-bet parlays if we have a good reason to do so.

No, we can’t win significantly more money over the long haul by parlaying our bets. That’s not why bookmakers don’t like parlays.

     …But that’s not all there is to the story. The value of using parlays actually has to do with the effective use of money management. The fact is, parlaying your bets in a correct manner can help you to dramatically reduce the downside risk to your bankroll.

Say two bettors have the same 15 bets at the same time. One bettor lays 15 individual bets, the other bettor uses five 3-bet parlays to cover the same 15 bets…Now, say they have one of those hellish days that make a sports bettor feel like King Midas in reverse. You know those days. We all have them. Nothing goes right. Maybe they go 3-12 or 2-13, or worse. The parlay bettor has limited his risk to five units, no matter how bad things get. The ‘standard’ bettor has risked fifteen units, – three times as many as the parlay bettor. (See the accompanying illustration.)

     …And check what happens when the two bettors have a great day; – maybe they go 12-3, or even 13-2, or better. The parlay bettor stands to win much more, depending, of course, on how he grouped his bets. Sometimes a parlay bettor will get lucky and happen to group all his winners into the same parlay and all his losers into another parlay, other times he’ll get unlucky and manage to group his winners with losers and lose all his parlays. This ‘luck-of-the-draw’ factor is not really a factor at all when it comes to the cost of vigorish. The luck of how the bets are grouped will even out over the long haul.

      That’s the advantage to using parlays: Parlaying your bets limits your downside risk. In fact, that is precisely the reason bookmakers don’t like parlay bets. It is not in the bookmaker’s best interest for you to limit your risk.


Figures below show the difference in expected cost of vigorish when risking $110 to win $100 on one bet at a time compared to risking $110 on 2-bet parlays @ 13-to-5, and $110 on 3-bet parlays @ 6-to-1. Comparisons cover a span of 600 individual bets.

——————————————————————– – –

Expected result of 600 individual bets, risking $110 to win $100, with 50% expectation per bet:

300 bets won x $100 = $30,000

300 bets lost x ($110) = ($33,000)

TOTAL RISKED OUT-OF-POCKET: $66,000…..NET COST: $3,000 (4.5% per bet)

——————————————————————– – —————

Expected result of 300 2-bet parlays paying 13-to-5, risking $110 to win $286, with 25% expectation per parlay (50% x 50% = 25%):

75 two-bet parlays won x $286 = $21,450

225 two-bet parlays lost x ($110) = ($24,750)

TOTAL RISKED OUT-OF-POCKET: $33,000…..NET COST: $3,300 (5.1% per bet)

——————————————————————– – —————

Expected result of 200 3-bet parlays paying 6-to-1, risking $110 to win $660, with 12.5% expectation per parlay (50% x 50% x 50% = 12. 5%):

25 three-bet parlays won x $660 = $16,500

175 three-bet parlays lost x ($110) = ($19,250)

TOTAL RISKED OUT-OF-POCKET: $22,000…..NET COST: $2,750 (4.3% per bet)


Notice the difference in out-of-pocket risk. The correct use of parlay betting allows you to limit the downside risk to your bankroll when you have multiple bets in the air at once. Bookmakers do not promote parlay betting because it is not in the bookmakers’ best interest for you to limit your downside risk. | January 13th, 1999

– – – – – – – – – – – –About the writer
JR is author of the sports betting classic – ‘How Professional Gambler’s Beat the Pro Football Pointspread”. He’s also the greatest all around handicapper we’ve ever seen.

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