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the vig simplified - how the bookmaker makes money

By Admin on August 19, 2012 in Betting Guide

As punters we all dread "the vig", which is short for vigorish. In punter slang it is often mentioned as "the juice". The bookmaker loves the flavor of this juice, and we don't blame him. After all, who wouldn't want to buy a dollar for eighty to ninety five cents on a regular basis? This is basically what happens as the bookmaker is taking out a theoretical margin on the bet offer. You can consider it a commission to take your bet and offer you the bookmaker services really.

Bookmaker vig, simple example

The concept is really intuitive and easy to understand. Imagine that you and your buddy were going to have a one flip coin tossing competition. You both put down €100 to win €100 since as the clever boys or girls you are decide that its likely the outcome is equally likely to be either heads or tails. This given the toss is done with a fair coin. For arguments sake assue the coin is fair. Now you flip the coin and the lucky winner is paid by the loser. Here, the entire pot of €200 is distributed.

Now, let's assume you and your friend want to do the same contest over again, but for whatever reasons you involve a bookmaker.  He deems you to be equally skilled in coin flipping, and assign a 50% likelihood to each of you. However, the bookmaker needs to feed his kids, save for a Ferrari and pay his staff so he calculates in vig. In another article we will show the few of you who find this extraordinarily interesting how this is done using info graphics. For now we just understand that the bookmaker should offer odds 2.00 on each of you if you were to bet €100 to win €100 as in the previous example. The bookmaker does not do that usually unless it is a special promotion. Instead he offers perhaps 1.90 1.90 on each of you to win. These odds represent 5% vig, or take if you like. This time you won but you only pocketed €90 for your hard earned coin tossing win. Your mate lost €100, so there is this tenner somewhere in the system that is unaccounted for. Look no further; it is in the pocket of your bookie.

This was a two outcome betting situation, but the same principle applies to situations with one or more outcomes. It doesn't matter if you are betting a single, looking at winner outright betting, placing a betting system like the trixie bet or going for one of our bet tips section football accumulator tips. You don't escape the vig.

Beating the vig?

Can the vig be beaten? It sure can, but it is going to require a lot of hard work. You have to overcome the head start that your bookmaker has, and then add enough value to the bet to actually be willing to place it. Most professionals prefer to price in a safety margin as well for potential mistakes in the bet analysis. After all, there are many factors in play. This is material for tons of other articles though. Articles you already can read at our site. We suggest you get to work and read them all.

Our goal

We at Howtobet.net hope to provide you bet tips and general betting advice that you can use to your advantage in the battle against the vig. Do read our articles, and think them through. Comment on them and get the discussion going. You'll be a better punter for it. Share them with your friends, get their views. They probably want to learn how to bet too.

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