Parlay Betting Explained: Math, Strategy, and When to Avoid Them

What Is a Parlay?

A parlay (also called an accumulator or multi bet) combines two or more individual bets into a single wager. The catch: every leg must win for the parlay to pay out. If any one leg loses, the entire bet loses.

The appeal is obvious: payouts multiply with each leg, creating the potential for large returns on small stakes. A $10 five-leg parlay can pay hundreds or even thousands of dollars. But the math behind that appeal is worth understanding before you start stacking legs.

How Parlay Payouts Are Calculated

Parlay odds are calculated by multiplying the decimal odds of each leg together.

Two-Leg Parlay Example

• Leg 1: Team A moneyline at -110 (decimal 1.909)
• Leg 2: Over 215.5 at -110 (decimal 1.909)

Parlay Odds = 1.909 x 1.909 = 3.644

A $100 bet returns $364.40 (profit of $264.40).

For comparison, betting each leg separately at $100 each risks $200 total and returns $191 per win. You'd need both to win to profit $182. That's less than the parlay's $264, but with the safety net that one winner still returns money.

Three-Leg Parlay

Add a third leg at -110:

Parlay Odds = 1.909 x 1.909 x 1.909 = 6.959

$100 returns $695.90. The payout looks impressive, but the probability of hitting all three at 50% each is only 12.5%.

The Payout Curve

The payouts scale exponentially, but so does the probability of losing.

The Hidden Math: How the House Edge Compounds

This is the part most bettors miss. The sportsbook's margin (vig) doesn't just apply once. It compounds with each leg you add.

The Vig Problem

On a single -110 bet, the implied probability is 52.38%, but the true probability for an even market is 50%. That gap of about 2.4% is the book's edge on that bet.

On a two-leg parlay:

• Fair odds (no vig): 2.00 x 2.00 = 4.00
• Actual parlay odds: 1.909 x 1.909 = 3.644
• House edge: (4.00 - 3.644) / 4.00 = 8.9%

On a five-leg parlay:

• Fair odds: 2.00^5 = 32.00
• Actual odds: 1.909^5 = 25.37
• House edge: (32.00 - 25.37) / 32.00 = 20.7%

The vig roughly doubles with each added leg. By the time you're at 8-10 legs, the house edge can exceed 40%. This is why sportsbooks love parlays. New Jersey's 2024 betting data showed books held 24.2% on parlays versus just 4.4% on straight bets.

When Parlays Are -EV (Most of the Time)

For the average bettor picking games at roughly 50/50, parlays are a losing proposition that gets worse with every leg added. The compounding vig ensures the book always has a significant edge.

The Numbers Don't Lie

If you make 100 two-leg parlays at $100 each with 50% win rate per leg:

• Expected wins: 25 (25% hit rate)
• Expected payout: 25 x $364 = $9,100
• Total risked: $10,000
• Expected loss: -$900 (-9% ROI)

Scale that to five legs:

• Expected wins: 3.13
• Expected payout: 3.13 x $2,537 = $7,941
• Total risked: $10,000
• Expected loss: -$2,059 (-20.6% ROI)

When Parlays Can Be +EV

Parlays aren't inherently bad. They're bad when you don't have an edge. If you have positive expected value on each individual leg, a parlay amplifies that edge.

The Math of +EV Parlays

If each leg has +3% EV individually, the parlay's EV is:

Parlay EV = (Combined true probability x Parlay payout) - Stake

Two +EV legs at 53% true probability, -110 odds each:

• True combined probability: 0.53 x 0.53 = 28.09%
• Parlay payout at -110/-110: $364 per $100
• EV: (0.2809 x $364) - $100 = +$2.25 (+2.25%)

The parlay is profitable, but notice the EV percentage is actually lower than betting each leg separately. This matters for bankroll growth.

Parlays vs. Straight Bets for +EV Bettors

Here's the nuance most people miss. With two +EV plays:

Betting straight risks more capital but produces more total expected profit. The parlay has a higher payout per dollar risked when measured as a percentage, but lower absolute profit because you're risking less.

For bankroll growth, straight bets are generally superior, unless you're specifically constrained on capital.

When Parlays Make Strategic Sense

• Correlated legs: If two outcomes are positively correlated (same game over + fast team winning), the true combined probability is higher than the independent multiplication suggests. Same game parlays can be +EV when books underprice correlations.
• Capital efficiency: If you want exposure to multiple outcomes but have limited capital to deploy.
• Promotional boosts: Profit boosts on parlays from sportsbooks can push marginal bets into +EV territory.

Same Game Parlays (SGPs)

Same game parlays combine multiple bets from the same event. They're hugely popular and extremely profitable for the sportsbook.

Why SGPs Have Massive Vig

When you bet a regular parlay, each leg is from a different game and the outcomes are independent. The book multiplies fair odds together.

With SGPs, outcomes are correlated. If you parlay "Team A wins" with "Over 220.5 points," these aren't independent because teams that win often score more. But the book prices SGP legs as if they were less correlated than they actually are (or not correlated at all), pocketing the difference.

The effective vig on SGPs is typically 15-30%, making them among the worst bets in sports betting from an expected value standpoint.

The Exception

If you can identify where the book has underpriced a correlation (where two outcomes are more linked than the SGP odds suggest), that's an edge. This requires deep knowledge of the sport and the specific matchup, and it's rare.

Common Mistakes

Adding Legs for Excitement

Each additional leg you add that doesn't have +EV makes the entire parlay worse. Never add a "just because" leg to juice the payout. You're paying for that payout with compounding vig.

Not Checking Individual Leg EV

Every leg of a parlay should be a bet you'd make individually. If you wouldn't bet it straight, don't include it in a parlay.

Ignoring CLV on Parlay Legs

Closing line value applies to every leg of a parlay individually. Track CLV per leg, not just whether the parlay hit.

Chasing Big Payouts

The allure of a 10-leg parlay paying +50000 is powerful. The math says you'll hit it roughly once every 1,000 attempts. At $100 per try, that's $100,000 risked for an expected return of about $50,000.

Key Takeaways

• Parlay payouts multiply by multiplying decimal odds, so use a parlay calculator for quick math
• The house edge compounds with each leg. 2 legs: ~9%, 5 legs: ~21%, 10 legs: ~40%+
• For most bettors, parlays are worse than straight bets due to compounding vig
• +EV parlays exist but only when every individual leg has positive expected value
• Straight bets produce more absolute profit than parlays for the same number of +EV picks
• Same game parlays have massive vig, typically 15-30%
• Never add legs "just because" since every leg without an edge makes the parlay worse