Why the odds add up to more than 100%
Every price implies a chance: −110 means 52.4%, +150 means 40%. Add up the chances for every side of a market and you get more than 100%. The extra is the book's margin, also called the vig or the juice. It is how the book gets paid whichever side wins.
The simple case: −110 on both sides
- Each side implies 52.4%.
- Together that is 104.8%, so the margin is 4.8%.
- Take it out and each side is 50.0%: a coin flip, which is what the book actually thinks.
That fair chance is the no-vig probability. It is the honest read of what the market expects, and it is the number every CacheOut call starts from.
Lopsided markets: why the method matters
The simple way to remove the margin divides every side by the same total. But books don't load their margin evenly: they shade the longshot more, because bettors overpay for long odds. Dividing evenly leaves the favorite looking a little weaker than the market really rates it.
Take a −400 favorite against a +320 underdog. Divided evenly, the favorite is 77.1%. By the power method, which takes proportionally more from the longshot, it is 78.7%. On an even market the two methods agree; the further apart the sides, the more they differ.
CacheOut's game boards use the power method, book by book, before averaging across books.
What no-vig odds are good for
- Comparing books: the one with the smallest margin is charging you least for the same bet.
- Judging a price: if your own estimate is above the no-vig chance, the price is generous by your numbers; if below, it isn't.
- Checking a cash-out offer: fair value is computed from fair chances, not the book's loaded ones.
One caution: winning bets at fair prices is not proof of an edge. A fair price already contains what the market knows, so over time betting it breaks even, before the book's margin.
Not betting advice. 21+ where permitted.