Definition
The bookmaker margin (also called vigorish, vig, juice, or overround) is the hidden commission embedded in the odds. It is the gap between the displayed odds and the true fair odds. This margin ensures the bookmaker earns a mathematical profit regardless of the event's outcome.
How It Works
In a fair market, the implied probabilities of all possible outcomes sum to exactly 100%. Bookmakers inflate these probabilities above 100% to create their margin. The formula is: Margin = (Sum of implied probabilities - 1) x 100. The inverse metric, Return to Player (RTP), tells you how many cents per dollar the bookmaker pays back.
Example
Football match: Team A 2.10 / Draw 3.40 / Team B 3.60
- 1/2.10 + 1/3.40 + 1/3.60 = 0.476 + 0.294 + 0.278 = 1.048
- Margin = (1.048 - 1) x 100 = 4.8%
- RTP = 1/1.048 = 95.4% -- the bookmaker redistributes 95.4 cents of every dollar wagered.
Why It Matters
The margin directly eats into your profitability. With a 5% margin on even-money bets (2.00), you need a 52.4% win rate just to break even. Sharp bookmakers like Pinnacle operate with 2-3% margins, while recreational bookmakers may charge 6-10%. Every percentage point of margin reduction translates directly into better long-term returns for you.
Always check the bookmaker margin before betting. Use our RTP calculator to evaluate odds competitiveness and our no-vig calculator to find fair odds.