Image one. The bookmaker tweets about the big winner who connected 17 bets on a massive parlay to win real money on a small wager. Dreamy scenario most of the casual bettors are imagining each time they choose parlays as their betting option and come close to winning as so many times before.
Image two. According to the Nevada Gaming Control Board Gaming Revenue Reports, sportsbooks in Nevada boasted a nearly 30% hold on parlays between 1984 and 2016. In comparison, every other major sport, including the NBA, has a hold below 5% by itself.
Now try combining these two images and ask yourself why are the sportsbooks so willing to share information on how they’ve lost six-figures or other sizable amounts of money? The social networks – on the web or mouth-to-mouth – are full of shared stories on the big winners, but you won’t be able to read or hear on the small stakes that got flushed down the drain – luckily, if I may add, as the sheer number of such reports would tilt some safety fuses.
But I’m getting ahead of myself, so let’s get to the basics for the readers who haven’t thought much about this topic or are just entering the shark waters.
A parlay is a combination bet with two or more wagers linked together in pre-defined manner. If any of the bets in the parlay lose, then the entire parlay loses. However, bettors can get massive one-time payouts if they correctly guess the outcome of all the wagers in the field, as the odds get multiplied.
It’s easy to see why hitting this type of betting game is the ultimate fantasy with the recreational bettors. It’s the instant big-time prize without any hustle, and at a price of a couple of drinks and a family pizza. Nobody’s going to miss that money, right? Sure. Except, the people won’t stop at losing a one-time parlay wager.
Even the unskilled punter who hits only 50% of his bets will get three-out-of-six wagers right. On a good day, they’ll get four and sometimes even five. Instead of cashing in on the good fortune, the one miss will not only haunt them for the next couple of days, but also lure them into thinking that they were very close to cashing in a sizable amount.
So let’s take a look at the math to rebuke this feeling once and for all. The education of bettors hasn’t helped in the last few years, but I’d be happy if you would get convinced that parlays are not the way you should invest you money in the sports market.
First, if you have placed any parlays before, I hope that you did it with the offshore bookmakers, as there’s a big difference in how they treat the odds in comparison to Vegas. Offshore sportsbooks typically have better odds than Vegas, but neither offer true odds for parlays. There are other limitations, constructed to protect the book from the one-in-a-billion types of bets, usually concerning the number of linked wagers in a single parlay.
But the primary reason the books have been encouraging parlays and winning regularly on them is the increased juice they get from each added wager on the sheet. With the increased juice and the lowered probability of the right outcomes, the parlays are not the fool’s gold, they are the punters’ worst enemy. With money management being essential in this industry, it’s surprising to learn how little the people care about losing smaller amounts of money on these type of bets. That’s the main thing here. This is a business, and not the easy way to earn big bucks. And the leader in this business is the house. The parlays are their bread and butter, and I can show it to you with a simple example. You should sit down.
Say that you understand that the odds to hit many wagers are slim and you are focused on playing only the six-team parlays. Vegas pays 40/1 and the most offshore books pay 47/1 for such parlays. Let’s also assume that you are no better than flip-a-coin bettors and that you can hit the outcome of your wagers at a 50 percent clip.
Now let’s do the math and calculate your expected payout on a $100 wager.
The odds of correctly picking all the six games is 0.5 x 0.5 x 0.5 x 0.5 x 0.5 x 0.5 = 0.015625 = 1.5625%
You’d win $4000 at 1.5625 percent clip on your $100 wager, so your expected payout is:
(0.015625*$4000)-$100=$62.5-$100=-$37.5
This means that you are expected to lose more than a third of your investment on each six-team parlay bet. Compare it to the standard $9 on a single wager (assuming the normal -110 juice) and you’ll understand why the books are making enormous amounts of money on the parlays. Even if you’d use offshore sportsbooks, the expected payout would still be very negative: (0.015625*$4700)-$100=-26.5$. The larger the list of the linked wagers on a single parlay, the numbers grow more. You don’t feel so lucky any more, right?
Are occasional parlays allowed? What about doubles?
See, I’m not here to force any betting system on you. Everything is allowed and if you feel entertained by the prospect of hoping you’ll hit the rich vein, so be it. Playing singles is for the patient, methodical punters who do this as a way to earn money. It’s hard enough even without the occasional adventure that’ll lose you chunks of money. Just be fair to yourself and write down each parlay investment and continue to add new ones to the total sum until you win. Compare and see how much you’ve lost in an NBA or any other season or year.
Doubles are a good escape for those who don’t want to be as disciplined as proposed, but still have a decent chance of winning here and there. Both offshore and Nevada casinos pay out at 13/5 on doubles, so the expected payout is -$35 – worse than the higher combination parlays, as the books are looking to cash in on the habit of the restless.
While it can be tempting to bet doubles when you are very positive about your picks, avoid doing it – it’s the positive bias talking, and even if the true values are big, it’s better to increase the stake on two singles than to bet the double. The prices just aren’t right.
I truly hope I was able to show you why to avoid parlays in NBA betting, and it applies to all major sports. If you want to earn money placing wagers, stop treating it purely as fun and think of it as investment in business – the money you earn will allow you to have fun tomorrow. Speaking of, check back tomorrow for more advice on how to improve your finances betting the NBA.
