VigPulse

Market structure · 4 min read

What the vig actually is

Why the two sides of a market add up to more than 100 percent, and what that overround costs you per bet.

Current · free explainerThis article explains publicly known market structure. Worked examples use round numbers chosen so the arithmetic can be checked by hand — they are not prices from any market. Nothing here is betting advice, and no VigPulse formula is published.
Topic
Market structure
Reading time
4 min
Contains picks
No
Cost
Free

A sportsbook does not need to predict games well to make money. It needs to price both sides so that the implied probabilities add up to more than 100 percent. That surplus is the vig, also called the overround or the juice, and it is the house's structural advantage.

The arithmetic

A price of -110 implies a probability of 52.38 percent. Put -110 on both sides of a market and the implied probabilities sum to 104.76 percent. That extra 4.76 percentage points is the overround. The book's hold — the share of every dollar wagered it expects to keep with balanced action — is 1 minus 1 divided by the overround, or about 4.55 percent.

Overround and hold at common two-way prices
Both sides priced atSum of implied probabilityBook hold
-105 / -105102.44%2.38%
-110 / -110104.76%4.55%
-115 / -115107.00%6.54%
-120 / -120109.09%8.33%

The practical consequence is that a coin flip priced at -110 on both sides is a losing proposition. You need to win about 52.4 percent of those bets simply to break even, and every point of hold above that raises the bar further.

Note

Hold is not the same as the book's actual profit margin. It is what the book keeps if money lands evenly on both sides, which in practice it rarely does.

This is why the first step in evaluating any price is removing the vig. Until you do, you are comparing your estimate against a number that has the book's margin baked into it.

Run it yourself

Current

Enter both sides of a market and see exactly what the operator keeps.

Book hold calculator

Calculators run entirely in your browser. Nothing you type is sent anywhere, stored, or logged.

Where this is used on the site

  • Methodology — the seven stages between prices and a decision, in this vocabulary.
  • Results — every graded row of the public paper record, with CLV where it is meaningful.
  • Results methodology — how each row is captured and graded, including the gaps.

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