What Is a Parlay Bet and How Does It Work?

Parlay bet – Parlays have a distinct position in sports betting legend. There are numerous stories of outrageous parlay bets winning big money against all odds. In fact, the climaxes of the critically praised films “Silver Linings Playbook” and “Uncut Gems” both rely around audacious parlay bets.

So, what exactly is a parlay? What exactly is a parlay? Should you wager on parlays?

We’ll answer these questions and more here as we go over everything parlay.

Parlay bet -  everything you need to know regarding parlay bet, what it is? How to manage and how to place a bet

What Exactly Is a Parlay Bet?

A parlay bet is made in sports betting when a bettor makes two or more bets and combines them into one wager. Depending on the sportsbook or location, these bets may be referred to as “accumulators” or “multis.”

The gambler must win every little wager in order to win the parlay, and losing even one of the smaller bets results in the parlay being lost. A sportsbook typically offers higher payouts for adding more games to each parlay. Parlay bets are riskier because they combine multiple individual wagers, but they pay out more if all individual wagers win.

KEY LESSONS

  • A parlay bet is a type of sports wager that consists of two or more individual wagers. 
  • A sportsbook is a business that accepts parlay bets.
  • Combining bets into a parlay makes it more difficult to win but raises the payoff.
  • Parlay formats are available on mobile betting platforms such as BetMGM, FanDuel, and DraftKings.

HOW DOES A PARLAY BET PAY OUT?

Parlay bet -  everything you need to know regarding parlay bet, what it is? How to manage and how to place a bet

When the sportsbook accepts the parlay bet, they create a multi-level wager in which each winning bet becomes a larger wager on the next leg.

With two normal -110 legs, the first bet becomes $100 on the Bucs +3 or the under 54.5. Both bets terminate at the same time in this example, therefore it makes no difference which one represents the “first” leg. Because the Bucs +3 covered the spread, the $100 is now worth $190.91.

That $190.91 is now the stake for the second leg, which is under 54.5. That also came in, and a -110 bet at that price pays $173.55. Add them all together and you get $364.46.

Remember that the bettor began with a $100 stake, thus the profit in this parlay bet would be $264.46.

A simple structure exists for -110 wagers if you’re looking to conduct some back of the envelope arithmetic to figure out what a parlay bet will pay out. We’ve already shown that a two-teamer pays around 2.6-to-1. A three-team parlay pays about 6-to-1, and the odds double for every -110 bet added to the parlay.

Let’s look at some hypothetical bets from Week 1 of the NFL season to see how parlays would function. The lines that follow are all from DraftKings Sportsbook. We’ll look at a three-team parlay and then a four-team parlay now that we’ve broken down a two-team parlay.

How to Make a Parlay Bet

A parlay bet can be made in a variety of ways. Any online or in-person sportsbook will accept this type of wager and evaluate the odds of winning. To select teams and totals, casinos use a popular alternative known as a parlay card. Along with the wagered money, the card is given to the ticket writer at the sportsbook. Parlay formats are available on mobile betting platforms such as BetMGM, FanDuel, and DraftKings.

Payout Calculation

Calculating the odds of parlay bets can be difficult, due in part to the way odds are expressed in sports betting in the United States. A parlay can be calculated by any sportsbook, which is often what gamblers rely on.

To determine a payment, follow these steps:

  1. Convert the decimal odds to American odds.
  2. Add all of the decimal odds together.
  3. Multiply the result by the amount you bet.
  4. To calculate the parlay chances, subtract your initial stake.

Assume a bettor is parlaying three-point spreads at -110. To begin, convert the odds to decimal form, which is 1.91. Then add them all together: 1.91 x 1.91 x 1.91 = 6.97    

Then multiply this by a $10 bet: 6.97 x 10 = 69.7

The original stake amount is then subtracted: 69.7 – 10 = 59.7

This parlay pays $59.70 for every $10 wagered. That’s +597 in American odds, which means this parlay pays nearly 6-1. For -110 bets, there is a simple rule. A double bet pays around 2.6-to-1, while a triple parlay pays approximately 6-to-1. The odds nearly double after that for every -110 wager added to the parlay.

A Parlay Bet Example

If a bettor believes that the Green Bay Packers (+4) and Baltimore Ravens (-6) will cover their spreads on an NFL Sunday, they can utilize $10 and bet on these teams separately for $5. If both succeed, the prize is around $19. However, the bettor can combine these wagers for a win of around 2.65 times the bet. The following are probable outcomes:

  • Both teams are responsible for: Win ($26.50)
  • The Packers cover, but the Ravens do not: Loss (-$10)
  • The Ravens cover, but the Packers do not: (-$10)
  • Neither team covers: Loss (-$10)

The parlay raises risk but gains more than two separate bets. Parlays can be more complex and include more individual bets. Instead of simply two teams covering the spread, a bettor may wager on five. If one team fails to cover their spread, the entire bet is forfeited. If all five are covered, the payout is high: about +2335, or a $230.35 win on a $10 bet.

Risks and Benefits

“Parlay [bets] are popular because everyone dreams of turning a little bit of cash into a big payday,” explains Steven Petrella, deputy editor for The Action Network. “Sportsbooks love to promote big parlay winners on X platform (formerly Twitter) and Instagram, but they’re not posting the thousands of losing parlay tickets.”

Bettors are considerably less likely to win parlay bets than single bets, and sportsbooks profit more from parlay bets than single bets. According to Nevada Gaming Control Board Gaming Revenue Reports, Nevada sportsbooks had an almost 30% hold from 1992 to 2015, according to a study conducted by the University of Nevada Las Vegas Center for Gaming Research. Every other major sport has an average of less than 5%.

Individual bet odds are calculated to create a modest profit for the sportsbook. With regular bets, gamblers have a 50% probability of profiting. By combining many wagers into a single wager, the bettor increases their risk and reduces their odds of winning. “The math backs that up, too,” says Petrella of The Action Network. “The true probability of winning four NFL point spreads combined is about +1500,” he continues, “but the sportsbook only offers +1200.”

BET ON A 3-LEG PARLAY

Let’s start with a basic three-team parlay on the moneyline, combining a couple favorites. Many gamblers prefer playing moneyline parlays because they are confident in the winning teams but do not want to lay long odds to win a small sum.

Here are three Week 1 NFL favorites that appear to be excellent parlay candidates for many bettors:

  • San Francisco 49ers vs. Detroit Lions (-380)
  • Cleveland Browns (-320) vs. Kansas City Chiefs
  • Baltimore Ravens against. Las Vegas Raiders (-250)

The fictitious bettor here wagers $100 on a parlay of these three teams. On Sunday afternoon, San Francisco and Detroit will face off. Assuming San Francisco wins, the bettor now has $126.32 in theoretical funds to roll over to the next wager – a profit of $26.32 in addition to the original deposit.

That $126.32 becomes Kansas City’s risk. If the Chiefs win as predicted, the bettor wins an additional $39.48. With that added to the stake, they now have $165.80.

Now fast forward to Monday evening. The $165.80 is wagered on Baltimore at -250 odds. This time, the net earnings would be $66.12, for a total of $232.12. After deducting the original stake, the bettor won $132.12.

As a result, the three-team parlay paid out around +132.

BET ON A 4-LEG PARLAY

Assume our hero wishes to be a little more aggressive this time. Three-team moneyline favorites may feel secure, but this one paid only +132. Unexciting.

Consider a four-team parlay with a couple of spread picks and a couple of hot underdogs that the bettor believes have a chance. Our hero predicts Daniel Jones and Kyler Murray will have breakout seasons in their third years. They are, however, skeptical about the rookie quarterback class. So:

  • The New York Giants (+115) • The Arizona Cardinals (+140) • The Houston Texans +3 (-105) • The Carolina Panthers -5 (-105)

After the first three games are completed, the bettor’s $100 investment becomes $914.83. The Giants are +115 on the moneyline, for a total payoff of $1,966.80.

This payout is significantly greater than the preceding rule of thumb, which offers an estimate of around 12-to-1 for a four-team parlay. Small price changes – notice how these prices are all better than -110 – make a big difference in the parlay payoff.

THE BENEFITS OF PARLAYS

Regardless of what the content in the sports betting industry says you, parlays are not the root of all evil. There are other compelling reasons to wager on parlays.

First and foremost, consumers enjoy sweating little bets that have the potential to win big. The same logic underpins the appeal of the lottery.

Many people are oblivious to the fact that they are putting a -EV wager. For them, betting isn’t always about making money in the long run, and that’s fine. Investing disposable dollars in a six-teamer with little chance of returning home provides them with amusement. Parlay away if they are betting responsibly and enjoy parlays.

Second, there are +EV parlays. We’ve already discussed how to combine winning bets to boost the possible payoff. However, even breakeven or -EV gamblers can occasionally find successful parlay bets using a concept known as correlation.

THE DISADVANTAGE OF PARLAY BETTING

Parlays, according to most sources, are a bad way to gamble on sports, at least in terms of long-term predicted value. This is due to the fact that in order for a parlay to have a positive anticipated value (+EV), all or almost all of the bets in the parlay must have a positive expected value.

Because this is a very high bar to clear, most parlays just help the bookmaker win the bettors’ money. Simply look at the revenue split from any legal betting market for proof. By a huge margin, sportsbooks routinely keep a bigger part of the money they take on parlays.

If that doesn’t convince you, compare the expected value of the $100 parlay to the expected value of two $50 spread bets, both at -110 odds. We’ll save you the math, but assuming a 50% chance of winning each individual wager, here’s how it works out:

  • Straight bets: -$4.55 • Parlay: -$9

Using parlays should do the trick if you want to provide the bookmakers money at twice the typical rate or faster.

CORRELATED PARLAY BETS

What if you could parlay two bets and winning one enhanced your chances of winning the other? It turns out you can. These are referred to as “correlated parlays.”

The most obvious example would be combining the first half over with the total over of the game. Obviously, if the first-half total is higher, the overall total becomes the favorite to win.

Because this is so evident, sportsbooks have put up barriers to prevent you from betting on these parlays. They used to, at least. “Same-game parlays” (SGPs) have recently become a sports betting sensation. However, you should examine the payouts on them before booking them and compare them to the individual bets parlayed together. Sportsbooks frequently fudge payouts in accordance with the correlation, which negates the +EV component of them.

In any case, connected parlays are permitted and pay in full. A good example appears in Week 6 of the 2021 NFL season. The Kansas City Chiefs then head to Washington for a meeting with the Football Team.

If everything goes as planned, Kansas City will have a tremendously explosive offensive, while Washington will have a very formidable defense. If the game turns into a high-scoring shootout, Washington will struggle to keep up. However, if the game is low-scoring — certainly under the total – Washington has a much greater chance of covering or winning.

If you accept this premise, then Washington and the under are connected bets. As a result, combining them in a parlay bet offers a +EV if you’re correct.

WHERE DOES MY PARLAY BET GO IF THE GAME IS CANCELLED?

Because parlay bets consist of numerous legs, neophyte bettors frequently have questions regarding grading parlays. Obviously, a single loss ends the parlay, but certain bets do not win or lose.

The first and most prevalent is a push. Assume that Houston lost by three points but that the other legs won. In this situation, the push simply drops out of the bet, making it a three-team parlay.

Another issue to be aware of is canceled or postponed games, which are more of a problem now than ever due to the epidemic. Again, most of the time, the bet simply drops out of the parlay, resulting in a smaller parlay.

The same goes for a rare tie in a moneyline bet. Unless you’re betting a three-way market (common in soccer), the tie is excluded from the parlay.

Consult your sportsbook’s regulations for complete information on how they handle various scenarios involving various bets.

PARLAY STYLES

Round Robin parlays and teasers are the most prevalent types of parlays.

The Round Robin

A Round Robin bet involves placing multiple parlay wagers at the same time. It’s as simple as that. Round Robin bets are simply a means to make numerous parlays easier. When a bettor “Round Robin’s” teams in sports betting, it’s analogous to a horse bettor “boxing” horses for an exacta or trifecta wager in a race.

The bettor will choose between 3 and 8 teams or totals to participate in the Round Robin. They’ll then decide how many teams or totals to tie together for the Round Robin. A bettor may, for example, choose eight teams and totals for a Round Robin and tie the parlays to as many three-team combinations as feasible.

The number of different parlays the bettor has will be determined by the combination of teams. Continuing the example, if a bettor chooses two teams and Round Robins eight teams, they will have 28 potential parlays. If the bettor chooses to make three-team parlays, he or she will have 56 distinct parlay tickets to choose from.

Each parlay ticket will cost the amount specified. If the bettor only has $300, they can Round Robin the teams by two, giving them 28 potential parlays for $10 apiece. The payoff for each winning parlay is the same as if the parlay bets had been placed individually.

Teaser

A teaser is similar to a parlay in that the bettor can choose various teams or totals. With a teaser, however, no moneylines are permitted. In contrast to a parlay, the bettor can adjust each point spread or total by a set amount of points. These bets pay less than a standard parlay because the additional points on the spread or total make them simpler to win.

Teaser bets can alter the point spreads or totals by six to ten points. Each leg of the teaser, however, must use the same number of points. The teaser’s legs might go in numerous ways.

  • For example, the Kansas City Chiefs’ -7 can be reduced to -1. Meanwhile, the Houston Texans can be baited for six points ranging from +4 to +10.

The more teams involved in a teaser, similar to a typical parlay, the bigger the return. Again, because different sportsbooks have different odds and restrictions, they may provide different payouts and teaser possibilities.

Conclusion

Parlay bets combine two or more wagers. They are a method of mixing multiple bets into one. Parlay bets are far more difficult to win than standard bets but have higher payoff. According to David Forman, vice president of research at the American Gambling Association, parlay bets can “be enjoyed purely for fun, not as a moneymaking opportunity.”

FAQ on parlay betting

Is a parlay a wise investment?

When compared to single-game wagers, a parlay is not a strong bet in terms of win chance.

How much does a three-team parlay pay?

A $100 three-team parlay with -110 odds on each game pays $595.79.

Can you combine prop bets?

Yes, you may parlay prop bets at several sportsbooks.

What exactly does key parlay mean?

A key parlay consists of a single stake that is used in numerous parlays.

Is it possible to parlay the same game?

In a parlay, you cannot utilize the same bet twice. However, you can parlay the spread or moneyline as well as the Over/Under total from the same game.

What are the odds of winning a three-game parlay?

Every parlay is dangerous, and the odds of winning vary. You lose the parlay if even one of your games does not go your way.

Do people win a lot of money on parlays?

Parlays are high-risk, high-reward bets by definition. If you win one, your payment will be greater than if you bet the parlay legs individually.

Is it better to place a straight bet or a parlay?

Making wise straight bets will help you win in the long run, while betting a well-constructed parlay may pay off big in the short run, but they are less likely to pay off in the long run.

When is it OK to pay out a parlay?

Making wise straight bets will help you win in the long run, while betting a well-constructed parlay may pay off big in the short run, but they are less likely to pay off in the long run.

When is it OK to pay out a parlay?

If your sportsbook permits you to cash out on in-play parlays, you can do so when you believe you’ve benefitted, even if you’re not sure about the final leg.

Michael Adams
Experienced writer in iGaming Industry. Worked for the big companies in the industry, now I took the challenge to grow with a new company and a new website. The future is bright and I am happy to be part of it!

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