It can be very profitable to further inform your knowledge-based Eurovision bets with some basic maths. Two great ways to do this are explained in our winning principles article. Another way to do this is by considering over-rounds. The over-round on a betting market is defined as the sum of the implied probabilities of the odds. You can calculate it easily such as in this example:
Implied Probability = 1/Odds
The longer the odds are in the market, the smaller the over-round is. An over-round of 100%* indicates a completely ‘fair’ market. Though bookmakers will always make markets with an over-round higher than this to allow for their uncertainty of the true odds, and to enable them to make a profit.
The size of the over-round will generally depend on the number of runners, how confident the bookie is in their odds, and how competitive the bookie wants their odds to be. Over-rounds can vary greatly, but as a rule of thumb they are about 105% + 2% extra for each runner (up to around 190%)*. You want to be betting mostly into markets with lower than typical over-rounds.
Bookies generally don't tell you their over-rounds, but on the the Betfair exchange they actually show the market over-round for you. This is because exchanges thrive from giving users value and liquidity, so you will generally find their over-rounds to be much smaller than on bookmakers (we have more detail on betting exchanges here).
How can you use over-rounds?
The over-round is one of the first things I look at in a new market. This is because you can use it to give you an indication of the fairness of the odds and potential value in the market. A low over-round doesn’t guarantee that there are good value bets in the market, but it makes them more likely, and easier to spot if you are comparing selections.
In situations where the bookies really don’t have a clue or disagree greatly, it can lead to scenarios where you can select the best odds from different bookmakers to create an ‘effective market’ with an over-round of lower than 100%. In such a scenario you can actually bet on all of the outcomes and book in a guaranteed profit if you use the right staking – this is the same concept as arbitrage.
If you have a hunch in these situations and you don’t mind taking a bit of risk then it may be even better value to just pick a couple of your favourites, and bet on them (personally I’d go with Stina and Jorn in this example).
Hopefully this has been a good introduction to over-rounds and how they can be useful. If you have any questions then let us know.
Happy Betting!
* This for a market with one winner. For markets with multiple winners (such as qualification markets) you should multiply the by the number of winners (e.g. a fair market for a Eurovision semi-final market would have a 10x100% = 1000% over-round)
Gamble responsibly: BeGambleAware
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