Every bookmaker builds a profit margin into their odds. Understanding this margin — also called the overround or vig — helps you find better value bets and choose the right bookmaker.
What Is the Overround?
In a perfectly fair market, the implied probabilities of all outcomes would add up to exactly 100%. In reality, bookmakers set odds so the total exceeds 100%. The excess percentage is their margin.
Example — a match with these odds:
| Outcome | Odds | Implied Probability |
|---|---|---|
| Home Win | 2.10 | 47.6% |
| Draw | 3.40 | 29.4% |
| Away Win | 3.60 | 27.8% |
| Total | 104.8% |
The 4.8% above 100% is the bookmaker’s margin on this market.
How to Calculate the Margin
Formula: Margin = (Sum of all implied probabilities − 1) × 100%
Where implied probability for each outcome = 1 / Decimal Odds
Typical Margins by Bookmaker Type
| Bookmaker Type | Typical Margin |
|---|---|
| Sharp/Exchange (e.g. Betfair) | 2–3% |
| Mainstream European (e.g. Bet365) | 4–6% |
| Asian bookmakers | 2–4% |
| Local/regional bookmakers | 7–12% |
Lower margin means better value for the bettor.
Why This Matters for the 168 Index
The 168 Index monitors odds from 30+ bookmakers, including both sharp and soft books. When a sharp bookmaker (low margin) moves their odds significantly, it is a stronger signal than when a soft book moves.
By tracking odds movement across the full market, the 168 Index can identify when the true probability of an outcome has shifted — as opposed to a bookmaker simply adjusting their margin.
How to Use Margin Data
- Always compare odds across multiple bookmakers
- Prefer bookmakers with lower margins for better long-term value
- A sudden margin drop from a bookmaker often signals a major odds movement
- The best odds on any outcome are usually at the bookmaker with the lowest margin for that specific market
Key Takeaways
- The overround is the bookmaker’s built-in profit margin
- It is the sum of all implied probabilities minus 100%
- Sharp bookmakers have lower margins than soft bookmakers
- Always seek the best odds across multiple bookmakers
- The 168 Index tracks margins across 30+ bookmakers in real time