Parlays tend to get a bad reputation among long-time bettors since these wagers favor the house, despite the multiple parlay systems created. On the other hand, others were able to make money on this risky wager consistently.
Are parlays a bad idea? Is there any merit to making them for upcoming sports seasons? We answer these questions by discussing the advantage and disadvantages of parlays and parlay systems.
How Parlays Are a Bad Idea
Odds in parlays tend to back the house most of the time, especially with so many legs weighing the wager down. Even if a parlay consists of ones that are likely to win, there is a risk the entire wager loses.
Parlays are a collection of moneyline, spread, totals, futures, or prop bets that predicts every wager or leg it carries will win. Losing even just one of the legs will make the entire parlay lose. This condition makes parlays risky with more legs added to them.
Bettors have likely thought filling up parlays with five to ten favored wagers with prices of around -150 to -200 is the best way to go. American odds with a negative symbol indicate that a wager is highly likely to come accurate such as the Cavaliers going up against the Hornets in the NBA Eastern Conference 2022. The odds of winning a -200 money line are incredibly high. Many will assume that parlays consisting of five wagers with -200 odds have the same odds of -200 of winning. Unfortunately, this is not statistically true.
Let us form a coin toss parlay bet with five legs that predicts all tosses end with heads to illustrate the odds of the grouped wager. Each leg gives us a 50/50 chance or ½ odds that coins will land on heads. To get the probability of winning several coin tosses in a row, we multiply the odds by each other. For winning two coin tosses, that will be (1/2) (1/2) = parlay odds or (0.5) (0.5) = implied probability, which will give us decimal odds of 0.25 if we do this for five coin tosses or (0.5) (0.5) (0.5) (0.5) (0.5), the implied probability 3%.
Given our example, parlays consisting of five 50/50 wagers have a 3% chance of winning. This scenario makes sense since bettors need to win all five of these coin tosses while bookies only need for them to lose one.
What about parlays with -150 to -200 odds or a parlay with -155, -160, -154, -195, & -170? First, we turn the American odds to implied probability with an odds converter: 60.78%, 61.54%., 60.63%, 66.10%, and 62.96%. By applying the same formula from the coin toss or (0.6078) (0.6154)(0.6063)(0.6610)(0.6296) = implied probability, the chance for this specific parlay to win is 0.0943 or 9.43%. As you can see, this is one of the bad parlays that will likely lose even if you have highly favorable wagers to the bet.
Even with wagers that heavily favor you added to parlays, the edge is still with the bookies since the risks grow for every leg included in the bet. US sports betting companies are comfortable providing parlay insurance because of the overwhelming edge on their side.
When Are Parlays a Good Idea?
Despite the risks, parlays can still be bad news for bookies if you use correlated parlays. Correlated parlays consist of two or more wagers that are related to each other. If one of these wagers wins, the rest are likely to win. Note that we are not talking about wagers related to a sports league or a kind of bet.
Good examples of bets found in correlated parlays include the Cowboys covering the spread in the first half of the game and the team covering the whole game. Another would be a spread bet for the first or second half and an over wager for the favorites. If the team can cover the spread at any point in the game, the totals will likely go over.
Correlated parlays, including two-legged parlay, are profitable in the long run. With its payout of 2.5 to 1, a $100 stake has a payout of $350 or a profit of $250 if it wins. A correlated two-legged parlay can lose if the favorite does not cover the spread. However, what if we hedge our bets by making another correlated two-legged parlay? This parlay will have the underdogs covering the spread and the totals going under. The payout for one of these correlated parlays will cover the $200 stake while granting you a $50 profit.
Use our free parlay payout calculator to know how much you will earn from your parlay!
Bookmakers understand the profit potential of correlated parlays, which is why it is nearly impossible to do this in any game. You cannot add a first-half and full game spread or a first-half spread and totals for your parlays. The only way to get correlated parlays with a same-game parlay promotion. With this promotion, you can add legs from the same game to your parlay, allowing you to make correlated parlays.
Should Bettors Still Do Parlays?
Parlays are wagers for those who bet to risk instead of betting to win. People comfortable with losing money just for a chance at a massive payout are likely to enjoy the thrill of parlays.
Here is the possible payout of the earlier five-team parlay example provided earlier with a $100 stake:
|Parlay Leg||Sports Betting Odds|
Lucky bettors who hit that 9% win probability can get a sports betting parlay ROI of nearly ten times their stake. See how much you can win from parlays by using our payout calculator, and you will understand why people are still making this type of wager.
Are parlays good bets? Parlays are terrible if you are looking for wagers with long-term earning potential. However, these are valued bets if you can make correlated parlays. Regular parlay wagers pay so much more because you have very little chance of winning.
This article was published on December 19, 2022, and last updated on November 22, 2022.