How it’s calculated
Each price stands for a probability: 1 ÷ odds. In a fair market the probabilities of all outcomes add up to 100%. Bookmakers push them a little above 100%, and the difference is their margin.
1 ÷ 1.85 + 1 ÷ 3.60 + 1 ÷ 4.20
= 54.1% + 27.8% + 23.8% = 105.6%
kept ≈ 1 − 1 ÷ 1.056 = 5.3%
= 54.1% + 27.8% + 23.8% = 105.6%
kept ≈ 1 − 1 ÷ 1.056 = 5.3%
The “odds without margin” share the margin out in proportion: total ÷ probability. They’re an estimate of the price, not a forecast of what will happen.
Frequently asked questions
What is the bookmaker’s margin?
It is the amount by which the probabilities of a market add up to more than 100%. It gives the share of stakes the bookmaker keeps over time.
Why do the probabilities add up to more than 100%?
Because the odds are a little lower than a fair price. The difference is the margin the bookmaker builds in.
What are odds without the margin?
The odds a market adding up to exactly 100% would give, with the margin shared out in proportion. They’re an estimate of the price, not a forecast.