Most of us have done it at one point or another, in one form or another. Chased the “big payday” dream, odds be damned.
Maybe it’s plunking down a few bucks on the Powerball, especially on those weeks when it really swells up. Or entering a DFS contest with a couple hundred thousand entries and million-dollar grand prize. Or, if sports betting is more your speed, investing in a parlay or two on an NFL weekend.
Newsflash — the expected value (EV) on all of these is bad to varying degrees. Chances are you’re not going to be lounging on your own private island because you hit all seven numbers on your ticket or every guy in your fantasy lineup returned 5x on their salary. And it’s likely that one of your parlay teams lays an egg unexpectedly — Minnesota Vikings, we’re very much looking at you! — and ruins your four- or five-team train that could have scored you a handsome haul.
But even if you lose everything you put in, there’s an overriding point in every one of these cases … you had fun anticipating the possibilities! Specifically, the possibility of getting your initial investment back many times over.
Parlays have been a cash cow for decades
And yet, the numbers don’t lie – that fun can be quite a drain on your bankroll. The sportsbooks continue to run roughshod over bettors on parlays. Take this 25-year sample (1992-2017) from a research study by UNLV on Nevada casinos for starters:
- Casinos posted a sub-20-percent win rate on parlays in only two years during that period, and never lower than 17.26 percent.
- In turn, they posted a win rate between 23.33 percent and 29.79 percent in 10 years during that period.
- And incredibly, they posted a win rate in excess of 30.0 percent the most frequently – 13 out of those 25 years.
- All of those numbers add up to one especially jaw-dropping one: Silver State sportsbooks racked up an average 31.17 win percentage on parlays between 1992 and 2017.
Naturally, as good as those odds are for the books, they’re correspondingly crappy for bettors.
“The people creating the lines are extremely sharp and they are running the numbers to get the lines in favor so that the general public will lose more than they win,” observes professional handicapper and bettor Jon Price of Sports Information Traders. “When you add in the probability of winning a second or third bet with the contingency that all bets must win for the ticket to be cashed in increases the houses favor exponentially.”
Yet those slim chances didn’t prevent a total of $1.6 billion being placed on parlay wagers in Nevada casinos over that quarter-century period.
Meanwhile, the nascent Mississippi market serves as a tangible example of how “parlay fever” isn’t just localized in the desert. In their first full month of operation in August, 11 Magnolia State casinos took in over $1.5 million in handle on sports parlay cards alone. Notably, those figures were generated in a month where neither college football nor the NFL had yet kicked off their seasons.
Big parlay winners get plenty of attention
Again, the allure lies in the “what if”. Because when parlays do hit, they can hit big. And that’s more than enough of an enticement.
There’s no shortage of press when those explosive winnings do come to pass, too. The story of a $5 bet turned into a $305,000 payout on a William Hill progressive parlay card back in 2016 is one such example. And the big money isn’t just limited to wagers on team sports, either. Back in 2015, a bettor hit on a UFC parlay that converted his $1 investment into $48,291.
However, in a testament of what a dice roll these types of wagers can be, consider the first windfall was the result of an incredible 15-for-15 run in which the bettor nailed 12 college basketball winners and a trio of NBA games as well. The second involved the bettor correctly pegging a whopping nine underdogs to prevail on the UFC Fight Night 61 event in Brazil.
Predictably, parlay wagers are often panned by the sharps, who seem to have disdain for both the poor odds that they offer and the avalanche of attention that some of the big parlay winners get. However, even the sportsbooks themselves will gladly publicize the occasional butt-kicking they take on these bets, too. One look at the numbers cited in the UNLV study easily explains why.
Popularity of parlays to expand right along with sports betting
Given their significant popularity, logic would dictate that parlay betting will be a key part of sports betting’s gradual nationwide expansion over the next few years. In fact, the more the activity is made available to the masses, the more novice bettors with dreams of big returns on modest investments available to flock to parlays.
“I do believe that the popularity of parlay bets are going to surge through the roof in the next few years as the majority of states move to legalize sports wagering,” said Price. “Much like the lottery sells millions of tickets with extremely low probabilities of being paid out. At least with parlay bets the percentage of winners will be exponentially higher than the lottery, which is the biggest sucker’s bet that I’ve seen.”
One thing is certain: Given their proliferation and odds, parlay wagers are an important component of the sports betting ecosystem. They’re certainly helping sportsbooks stay in business, yet it’s not just a one-way street — and it’s that opportunity, no matter how remote, that keeps ’em coming back.