Why Parlays are generally considered to be poor bets

In general, betting on Parlays is considered to be a poor betting strategy. This is because for each event added to the bet the bookmaker’s margin is multiplied.

This can lead to bets that are hugely advantageous towards the bookmaker. 

Parlay betting strategy: Multiplying advantages

What is often missed when discussing the cons of Parlay bets is that, in the same way they boost the bookmaker’s margin, they can be used to multiply a bettor’s edge. If a bettor is confident they have an edge over the bookmaker, then they are powerful tools for increasing that advantage.

Here the bettor has calculated that three events offered by the bookmaker at decimal odds of 2.00 (50% implied probability) actually have a probability of 55.55% (implied odds of 1.8):

In this scenario, the bettor benefits from the Parlay in the same way the bookmaker usually does. His edge has increased.

Dependent events

If the bettor does not already have an edge then one other way a Parlay could be advantageous is if they can find a way to Parlay selections that appear to be independent bets but are actually in some way dependent.

An example of this could be combining a bet on a soccer player and a separate team the player does not play for to score over a certain amount of goals in a season. In this case, if the team scores a lot of goals it may be because the league in general has a high scoring season.

This could be caused by rule changes, a change in the style of soccer played in the league or a number of smaller factors combining together which have an advantageous impact on both outcomes.

These factors would also make the player more likely to score more goals even if he doesn’t play for that specific team. Therefore the bets are in some way dependent.

This is a fairly obvious example, and most bookmakers will be able to prevent these selections from being Parlayed. However, it is not impossible for a bettor on a rare occasion to find two seemingly independent bets that actually share a degree of dependency.

Parlays and volatility

One thing for Parlay bettors to be aware of is that in the short run, betting on Parlays will increase the volatility of returns.

In the example shared above, a bettor betting on an individual outcome will see a return more than 50% of the time if the bettor’s probability is correct. However, when the three outcomes are Parlayed, the bettor will see a return 17% of the time but the winnings will be four times greater.

This greatly increases the volatility of the return. It is not improbable that the events backed by the bettor in the example Parlay and similar Parlays could fail to occur simultaneously on many occasions. This volatility can be difficult for the bettor to factor in unless they can find enough Parlays in the long run to ensure regression to the mean.

The limitations of Parlays

In addition to the usual issues with profitable bettors being limited by bookmakers, Parlays can also be difficult to place at even the sharper books.

The scenario described in this article of a profitable bettor increasing their advantage over the bookmaker is one that they will seek to avoid. This means even the sharpest bookmakers may reduce the odds on offer when selections are added to a Parlay. On top of this, bookmakers will also be affected by the volatility on such selections since Parlays add an additional complexity to risk management.

In conclusion, as with most betting strategies the tool is only as good as the bettor himself. Parlays can be just as preferential to a skilled bettor as they are detrimental to a poor one.