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Betting Guide

What is Overround Betting? How OKBet and Other Bookmakers Secure Profits

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November 6, 2024
What is Overround Betting?

In the context of sports betting, the terms overround, vig, or juice are the words meaning how a bookmaker will always keep himself protected no matter the outcome of the event. To betting enthusiasts, however, these theories are very helpful in explaining the form in which the odds are set, where the money is made from, and therefore, where smart betting is made from. Overround betting is used widely by many successful sites, such as OKBet and other popular betting sites, because of the way it is used to add a margin that can allow for the bet to remain profitable regardless of the unpredictability of the result. To start, traditional overround breaks down this guide into its component processes, shows how the measure is computed, and its relevance to both bookmakers and bettors.

What is Overround in Sports Betting?

Overround is the additional margin that a bookmaker retains on the actual odds to ensure that he or she will win a bet whether the game or event in question will be won by the favorite, underdog, or end in a draw. But when odds are set such that the implied probability of the total on an event is higher than 100%, bookmakers provide for themselves a safety edge or margin by which they will be able to make a profit based on any outcome. That is to say, overround betting is one strategy that bookmakers use to avoid falling behind. This margin is hundreds over 100 and is a very effective way to maintain profitability across thousands of betting markets.

How to Calculate Overround: The Basics

To understand overround, let’s look at an event with two possible outcomes, like a tennis match or a coin toss. For a “fair book,” where each outcome probability adds up to 100%, odds would be set so that the sum of the implied probabilities for all outcomes equals 100%. However, to ensure a profit, bookmakers increase this total probability above 100%.

The formula for Implied Probability

The formula to calculate the implied probability of an outcome is: Implied Probability=1Odds×100\text{Implied Probability} = \frac{1}{\text{Odds}} \times 100Implied Probability=Odds1​×100

For instance, if a bookmaker sets the following odds for a match:

  • Player A: 1.80
  • Player B: 2.20

Here’s how we can calculate the overground:

  1. Calculate the Implied Probabilities
    • Player A’s Implied Probability: 11.80×100≈55.56%\frac{1}{1.80} \times 100 \approx 55.56\%1.801​×100≈55.56%
    • Player B’s Implied Probability: 12.20×100≈45.45%\frac{1}{2.20} \times 100 \approx 45.45\%2.201​×100≈45.45%
  2. Add the Implied Probabilities
    • Total: 55.56%+45.45%=101.01%55.56\% + 45.45\% = 101.01\%55.56%+45.45%=101.01%

The total probability here is 101.01%, which exceeds 100% by 1.01%. This additional 1.01% is the overround or margin, representing the bookmaker’s edge. If bettors place equal amounts on both outcomes, the bookmaker stands to make a 1.01% profit.

Why Do Bookmakers Use Overround?

Overround is vital for bookmakers as it reduces the financial risk associated with offering bets. Without overround, they could potentially suffer losses, especially in scenarios where “sharp” bettors (experienced bettors skilled in spotting value) place large bets.

Bookmakers often adjust the overround based on market competition and perceived bettor interest. High-profile events like championship games or finals may have a smaller overround to attract more bets, while lower-profile games might feature higher overround percentages, securing greater margins.

Overround in Events with Multiple Outcomes: A Horse Racing Example

Overround becomes even more critical in events with numerous outcomes, such as horse racing, where multiple horses have a chance of winning. Here’s an example to illustrate this scenario:

Imagine a horse race with three horses, each assigned the following odds:

  • Horse 1: 3.00 (Implied Probability = 33.33%)
  • Horse 2: 4.00 (Implied Probability = 25.00%)
  • Horse 3: 5.00 (Implied Probability = 20.00%)

If we add these probabilities, the total implied probability is: 33.33%+25.00%+20.00%=78.33%33.33\% + 25.00\% + 20.00\% = 78.33\%33.33%+25.00%+20.00%=78.33%

To ensure a profit, the bookmaker might adjust the odds downwards:

  • Horse 1: 2.50 (Implied Probability = 40.00%)
  • Horse 2: 3.75 (Implied Probability = 26.67%)
  • Horse 3: 4.50 (Implied Probability = 22.22%)

Now, the total implied probability becomes: 40%+26.67%+22.22%=88.89%40\% + 26.67\% + 22.22\% = 88.89\%40%+26.67%+22.22%=88.89%

This creates a total overround of 11.11% (100% - 88.89%), meaning the bookmaker has a built-in profit margin.

How Does Overround Affect Bettors?

The impact of overround on bettors is mainly felt in the form of reduced payouts. The higher the overround, the lower the potential return on each bet. This margin, while necessary for bookmaker profits, affects the odds value bettors receive.

For example, a bettor choosing between two bookmakers may notice that the overround at one is slightly lower than the other. The lower-overground option often translates to better odds and potentially higher returns over time.

Strategies to Minimize Overround’s Impact

While overround is unavoidable, bettors can take steps to minimize its effects on their profits. Here are some strategies:

  • Shop for the Best Odds: Handicap value varies from one bookmaker to another thus, it the important to compare the odds on different sites to get the best offer.
  • Use Betting Exchanges: It is a platform synonymous with a bookmaker where users can bet against one another instead of betting against the bookmaker; as such it is associated with lower overrounds since betting exchanges only take commission on winners.
  • Consider Arbitrage Betting: Very often, using real-life examples, differences in odds between various bookmakers generate arbitrage situations. Deciding to bet on all possible outcomes in the different companies, bettors can guarantee themselves a short-term profit that levels out the overround. However, arbitrage betting can only be done mathematically well and very fast to take advantage of these odds.

Conclusion: Overround and Betting on OKBet

In the competitive landscape of sports betting, overround is a vital mechanism that enables bookmakers to secure a profit while offering a range of betting options. By understanding overround, bettors can make more informed decisions and find better value. Platforms like OKBet, known as Asia’s most trusted sports betting provider, offer bettors competitive odds on various sports events. With OKBet, users can access a world of betting options that bring them closer to the action in basketball, football, boxing, and more.

For betting enthusiasts, OKBet not only provides extensive sports coverage but also ensures transparency in odds, giving bettors a fair and enjoyable experience. Explore OKBet for an immersive betting experience and keep up with the latest in sports news, events, and insightful betting strategies. Whether you’re new to betting or a seasoned pro, understanding the nuances of overround and other betting terms can give you the edge you need in today’s dynamic sports betting environment.

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