Betting margins is the way that the bookmaker receives an edge on the odds that they offer. In the following guide we have explained all about this and the impact that it has on your bets!
What is betting margins?
Betting margins is the way that all bookmakers use to increase their chances of making a profit from the bets that we’re placing. As you may or may not know, all eSport odds offered are based on predictions of the likelihood of a certain outcome occurring. If you’re for instance betting on the winner of the match, the odds offered will be based on the likelihood of each team winning.
With betting margins these odds are manipulated in a way so that the bookmaker receives an advantage. This means that the odds offered by bookmakers do not represent the statistical likelihood of the outcome taking place. The difference between the actual likelihood and the odds that the eSport betting sites are offering is the so called betting margin.
A very simple example to illustrate this is if we were to place a bet on a coin toss. The statistical likelihood of either side of the coin showing up would be 50% or 1 in 2. Hence, if a bookmaker that made no profit at all would offer a bet on this, the odds would be 2 to 1 or 2.00 if viewed as decimal odds. In reality this never happens as the odds offered would more likely be somewhere around 1.80 – 1.96 depending on how much of a margin the bookmaker is looking to make.
How does betting margins affect my bets?
If bookmakers always made the correct predictions of the outcomes in a match, it would be very difficult to make a long term profit. To do so, one would have to rely on using bonuses for value as there wouldn’t be any value in the odds themselves. For the casual bettor that is mainly betting on eSports for fun and to up the excitement of the professional matches being played, this wouldn’t matter that much. For those that are in it to make as much money as possible and perhaps even a living out of their betting, this would however be a huge disadvantage.
Now luckily for all of us, the bookmakers aren’t always making the correct predictions. The fact is that they regularly make mistakes and set odds that aren’t at all corresponding with the actual likelihood of the outcome occurring. This means that although the bookmakers’ betting margins always lower the odds, it’s fully possible to find great value in them by just making better predictions. This is all you have to do to make a long term profit as if you’re only betting on odds that are higher than the actual probability of the outcome occurring, you’re guaranteed to make money in the long run.
Because of this, the betting margin isn’t really anything you would ever have to think about as all that matters is your own prediction and finding odds that are higher than this. Sure, a bookmaker with a higher betting margin may be more likely to offer worse odds than a bookmaker with low margins, but this won’t always be the case. You should therefore focus on finding the best odds rather than focusing on finding low betting margins.
How to calculate betting margins
Betting margins are easily calculated by using the following equation:
2-way market: (1/decimal odds A) * 100 + (1/decimal odds B) * 100 – 100
3-way market: (1/decimal odds A) * 100 + (1/decimal odds B) * 100 + (1/decimal odds C) * 100 – 100
Please note that you must first divide, then multiply and at the end add and subtract.
Let’s for instance imagine a Dota 2 match between Evil Geniuses and Wings Gaming. Evil Geniuses are given the odds of 2.10 to win, while Wings Gaming are given 1.70. To calculate the margin that the bookie has, you would just have to enter the values in the equation. This would look like the following:
(1/2.10) * 100 + (1/1.70) * 100 – 100
This would result in 0,47619 * 100 + 0,58823 * 100 – 100, which equals 47,619 + 58,823 – 100, which ends up in a total sum of 6,4. In other words, the margin that the bookie would have on the bets would be 6,4%.
We hope you enjoyed the article. If you liked it, please feel free and share it with your friends.