Parlay Betting Guide: When Combining Bets Makes Sense
Parlays are the sportsbooks' best friend. They look generous, promise massive payouts, and feel like the smart play when you're confident in multiple games. But the math tells a different story. This guide explains when parlays destroy your bankroll, when they can actually offer value, and how to approach multi-leg betting without falling into the traps that make books rich.
What You'll Learn
The Math Behind Parlay Odds
Understanding parlay math starts with one simple rule: multiply the decimal odds of each leg together. If you have two legs at +100 (which equals 2.0 in decimal format), your parlay pays 2.0 x 2.0 = 4.0 decimal odds, or +300 in American format. Three legs at +100 becomes 2.0 x 2.0 x 2.0 = 8.0 decimal, or +700 American.
This seems straightforward, but here's where the house gets you: the vig compounds with each leg. At standard -110 juice (which equals 1.91 decimal odds), a single bet requires winning 52.4% of the time to break even. A two-leg parlay at those same odds requires hitting 27.5% of the time to break even, which is 52.4% multiplied by 52.4%.
The problem is that books don't pay true parlay odds. A "fair" two-leg parlay at -110 per leg would pay +264. But most books pay closer to +260 or even less. That gap seems small, but it represents additional edge for the house on top of the already-compounded vig.
The Vig Snowball Effect
As you add legs to your parlay, the gap between what you're paid and what you should be paid widens dramatically. A three-leg parlay might show odds of +600 when fair odds would be closer to +700. By the time you're building eight-leg or ten-leg parlays, you're giving the house an enormous edge.
| Parlay Legs | Approximate True Odds | Typical Book Odds | House Edge Gap |
|---|---|---|---|
| 2 | +264 | +260 | ~1.5% |
| 3 | +600 | +580 | ~3% |
| 4 | +1228 | +1100 | ~10% |
| 5 | +2435 | +2000 | ~15% |
| 6+ | Varies | Much lower | 20%+ |
This table illustrates why professional bettors rarely touch large parlays. The math is simply too punishing.
Why Most Parlay Bettors Lose
Sportsbooks make a disproportionate amount of their profit from parlay bettors. The reasons are mathematical, psychological, and structural.
The Multiplication Problem
Every leg you add to a parlay multiplies your chances of losing. Even if you're an excellent handicapper hitting 55% on straight bets, a three-leg parlay at that rate hits only 16.6% of the time (0.55 x 0.55 x 0.55). You need to hit at exceptionally high rates for the parlay math to overcome the compounding vig.
The Harsh Reality
If you're a 55% handicapper, you'll likely hit only about 17% of three-leg parlays and 9% of four-leg parlays. The reduced payout odds rarely compensate for this steep decline in win probability.
The Psychological Trap
Parlays feel like smart plays when you're confident in multiple games. The logic goes: "I like all three of these, why not combine them for a bigger payout?" But this reasoning ignores the compounding risk and the additional vig you're paying.
Worse, parlays encourage you to add legs you're less confident about. "Might as well throw in the Lakers game too," is a thought that has destroyed countless bankrolls. Each marginal leg you add dilutes your overall edge while increasing the house advantage.
When Parlays Actually Make Sense
Despite the math working against them, there are specific situations where parlays can be justified or even advantageous.
Situation 1: You Have Genuine Edge on Multiple Legs
If you're a skilled handicapper who consistently hits above 55% and you have strong conviction on multiple independent plays, two-leg parlays can make sense. The key word is "independent." Each leg must be something you would bet individually at full size.
The 2-Leg Rule
Most professionals who use parlays at all stick to two-leg combinations. The vig penalty is smallest on two-teamers, and you maintain some diversification. Anything beyond two legs is typically entertainment, not strategy.
Situation 2: Correlated Outcomes
Correlated parlays combine bets that have a logical relationship. If one outcome occurs, it makes the other more likely. This is where genuine edge can exist, and we'll cover it in detail below.
Situation 3: Extreme Bankroll Constraints
If you have a tiny bankroll and need to grow it quickly to bet at meaningful sizes, small parlay wagers can make mathematical sense. The expected value is negative, but the utility value of a potential larger bankroll might justify the approach. This is a specific scenario, not a general strategy.
Situation 4: Promotional Value
Many sportsbooks offer parlay boosts, insurance, or profit multipliers. When these promotions are generous enough, they can shift the math in your favor. Always calculate whether the promotion actually overcomes the natural parlay disadvantage.
Correlated Parlays: The Edge Books Don't Want You to Find
Correlated parlays represent the one area where combining bets can offer positive expected value. The concept is simple: some outcomes are linked. If one happens, it increases the probability of another happening.
What Makes a Parlay Correlated?
True correlation means the outcomes affect each other's probability. If the Chiefs jump out to a 21-0 lead (making them likely to cover), it also increases the probability of the game going over (since the trailing team will need to score aggressively).
Some classic correlations:
- Team spread + game over: A team covering a large spread often pushes the total over because the leading team is scoring heavily.
- Underdog spread + game under: Underdogs covering typically keep games close and low-scoring.
- Same-game player props: If a quarterback throws for 350+ yards, receivers are more likely to hit their receiving yard props.
- First half/full game combinations: A team leading at halftime is more likely to win the game.
Example: Correlation in Action
Leg 1: Chiefs -10.5
Leg 2: Game over 48.5
If Kansas City covers a double-digit spread, it likely means they scored 28+ points. This significantly increases over probability compared to what the parlay odds assume.
Why Books Don't Like Correlated Parlays
Sportsbooks historically banned obviously correlated parlays or priced them unfavorably because the true probability of both legs hitting is higher than the independent calculation suggests. The "same-game parlay" products now offered by most books are carefully priced to account for correlations, often eliminating the edge.
However, books can't perfectly price all correlations. Subtle relationships between outcomes sometimes slip through, creating genuine edge for bettors who understand the connections.
How to Size Your Parlay Bets
Kelly Criterion, the mathematical formula for optimal bet sizing, actually argues against parlays in most cases. Even when you have edge, the higher volatility of parlays means you should bet smaller relative to your bankroll.
The Kelly Math
If Kelly suggests betting 5.5% of your bankroll on a single bet at 55% and -110, it suggests betting only about 3.8% on a parlay with the same underlying edge, despite the parlay's potentially higher return. The volatility adjustment is significant.
Practical Sizing Guidelines
- 2-leg parlays: No more than 2% of bankroll
- 3-leg parlays: No more than 1% of bankroll
- 4+ leg parlays: Treat as entertainment, tiny stakes only
These are maximum guidelines for bettors who believe they have edge. If you're not confident in your handicapping, reduce further.
Straight Bets vs. Parlays: The Bottom Line
Even if you have slight edge on a parlay, straight bets on the individual legs typically produce better long-term results with less variance. The exception is when correlation exists between legs, genuinely increasing the probability beyond what the odds assume.
The honest answer for most bettors: stick to straight bets. Parlays should be a small percentage of your action reserved for specific situations, not your primary betting approach.
Common Parlay Mistakes
Mistake 1: Adding "Lock" Favorites
Throwing in heavy favorites at -300 or -400 to "boost your parlay odds" seems smart but adds significant risk for minimal reward. Those favorites lose more often than casual bettors expect, and when they do, your entire parlay dies for a leg you added almost as an afterthought.
Mistake 2: Chasing Yesterday's Losses
Building a big parlay to recover losses is one of the fastest ways to destroy a bankroll. The math doesn't care that you had a bad day yesterday. Parlays are not a recovery strategy.
Mistake 3: Confusing Correlation with Causation
Not all seemingly-related outcomes are actually correlated in ways that help you. "This team always covers at home" and "they always hit the over" doesn't mean combining those bets is correlated. True correlation requires a logical link where one outcome directly affects the probability of the other.
Mistake 4: Ignoring the Juice
Comparing parlay payouts across books can reveal significant differences. Some books pay -110 parlays at +260, others at +264. Over time, this matters. Shop your parlays just like you shop straight bets.
Mistake 5: Building Parlays from Weak Sides
If you wouldn't bet a game as a straight bet at full size, it shouldn't be in your parlay. Parlays work (when they work) by combining multiple positions you have genuine conviction in, not by throwing together "lean" plays for excitement.