Calculate bookmaker overround, true probabilities and fair odds
The bookmaker margin (also called "overround" or "vig") is the percentage by which the bookmaker inflates the true probabilities to create theoretical margin. A margin of 0% would mean perfectly fair odds before operating costs and market risk. Most recreational bookmakers have margins of 5-10% on football 1X2 markets, while sharp books like Pinnacle typically offer 2-3% margins.
For a 3-way market (Home/Draw/Away), the margin formula is:
Margin = (1/Home + 1/Draw + 1/Away - 1) × 100%For example, odds of 2.10 / 3.40 / 3.50 give: (1/2.10 + 1/3.40 + 1/3.50 - 1) × 100 = 5.63% margin