The vigorish, or “vig,” is a term used in sports betting to describe the theoretical advantage a professional bookmaker has when taking any wager from a bettor. Similar in concept to a commission, the vigorish exists to ensure the business of oddsmaking is profitable as well as to protect the bookmakers themselves from sudden ruin in the event of an unlikely outcome.
The vigorish represents the mathematical edge that bookmakers create as a long term insurance policy, and is typically expressed bookmakers as a percentage. The percentage can commonly range from 2 to 5 percent, and is taken from the winning side’s share when the successful bets are paid out. For instance, the Packers are one of the most popular NFL teams to sweat for Wisconsin sports betting fans. If an event were to draw 10,000 dollars in wagers from both sides to create a $20,000 pool with a 2 percent vigorish in place, the winners would be paid a total of $18,000 while the bookmaker turned a profit of $2,000 regardless of the winning side.
Vigorish Against the Spread
Betting against the spread, or against a predetermined margin of victory, is the most common form of wagering on team sports such as basketball or football because it can often make wagering on both teams equally attractive to bettors. The industry standard for bets against the spread is shown as -110, meaning that for every $110 you stake you stand to win $100 with a successful bet, and the extra $10 is kept by the bookmaker as vigorish.
Money Line Vigorish
Low scoring games such as hockey and soccer as well as combat and individual sports more often use the money line system. These bets simply require a wagerer to correctly predict a winner, and the bet is structured to pay out according to the participants’ respective chances at winning. Money line bets will typically be rendered with the favorite rated as -100 or less and the less favored side rated at +100 or more. This means that a bettor will have to risk the listed amount on the favorite to win $100 and a bet of $100 on the less favored side will net the listed amount in the event of a successful wager.
Instead of taking vigorish on each game or match within a multiple-event parlay bet, bookmakers apply vigorish to these bets by lowering the payout overall as compared to an individual wager on each event. For example, if the odds of a bettor correctly predicting 3 games at random is 7-to-1, the parlay will pay out at 6-to-1 odds and reserve the extra payout. This ratio grows even more favorable to the bookmaker as more events are added and the chance of a winning wager approaches the astronomical.
Vigorish is a form of protection that helps ensure bookmakers can pay winning wagerers as well as keep their operations running smoothly. While it may be true the house always retains the edge, by intelligently navigating the realities of vigorish, players can get the most favorable odds at as low a personal risk as possible.