How Bookmaker Margins Work
A bookmaker margin is the difference between the true probability of an outcome and the probability implied by the price on offer. Convert every price in a market to an implied probability, add them up, and the amount by which the total exceeds 100% is the margin — the operator's built-in edge. In our sample of Australian markets, measured average margins ran from about 4.9% (Sportsbet) to roughly 7.4% (bet365), which means the same bet can cost you noticeably more or less depending on where you place it.
This guide shows the exact maths, works a numbered example, and compares the average margins we measured across licensed AU operators so you can see where value tends to sit.
The core formula: implied probability and overround
Every decimal price carries an implied probability: divide 1 by the odds. A price of $2.00 implies 1 / 2.00 = 50%. A price of $1.90 implies 1 / 1.90 = 52.63%.
In a fair two-way market the true probabilities sum to 100%. A bookmaker prices both sides slightly short so the implied probabilities add to more than 100%. That excess is the overround (also called the vig or the juice). Margin is usually quoted as overround minus 100%.
Formula for a two-way market:
- Margin = (1 / odds_A) + (1 / odds_B) − 1
For a market with more outcomes (a three-way football result, a large horse racing field), you sum the implied probability of every runner or outcome and subtract 1. More outcomes generally means more places for a bookmaker to load margin, which is why big racing fields and multi-runner futures markets tend to carry higher margins than a straight head-to-head.
Worked example: an AFL head-to-head
Take an AFL match priced by two bookmakers.
Bookmaker 1: - Home $1.90 → implied 1 / 1.90 = 52.63% - Away $2.00 → implied 1 / 2.00 = 50.00% - Sum = 102.63% → margin = 2.63%
Bookmaker 2: - Home $1.83 → implied 1 / 1.83 = 54.64% - Away $1.91 → implied 1 / 1.91 = 52.36% - Sum = 107.00% → margin = 7.00%
Both markets describe the same contest. Bookmaker 1 has shaded the true 50/50 by only 2.63%; Bookmaker 2 by 7.00%. On a $100 bet at the home side, Bookmaker 1 pays $190 and Bookmaker 2 pays $183 — a $7 difference on one leg for identical exposure.
Across a season of bets that gap compounds. If your true win rate keeps you break-even against a 2.6% margin, the same picks lose money against a 7% margin without a single result changing. Margin, not luck, decides that outcome.
Implied Probability Calculator
Why margins differ between markets and sports
Margin is not uniform inside a single bookmaker. It varies by:
- Number of outcomes: a two-way tennis match carries less margin than a 16-runner Saturday metro race.
- Liquidity and profile: high-turnover markets like AFL, NRL and Premier League head-to-heads are priced tightest because competition forces operators to shade their edge. Obscure lower-league or novelty markets carry fatter margins.
- Bet type: same-game multis and Bet Builder legs are correlated and repriced, so effective margin on a built bet is typically far higher than on the individual single markets that feed it.
- Live vs pre-match: in-play prices update fast and often carry wider margins to cover the operator's uncertainty.
When we quote an average margin per operator, it is a mean across a sample of markets — useful for ranking operators, but always check the specific market you intend to bet.
Measured average margins across AU bookmakers
The figures below are average margins we calculated from sampled markets. Lower is better for the bettor. Sample sizes vary, so treat small samples as indicative rather than definitive.
- Sportsbet — 4.91% average margin (44 markets sampled)
- PointsBet — 5.64% (51)
- Ladbrokes — 5.82% (258)
- Unibet — 5.84% (243)
- Neds — 5.89% (59)
- PlayUp — 5.93% (44)
- TAB — 6.05% (59)
- betr — 6.19% (56)
- bet365 — 7.44% (30)
On margin alone, Sportsbet posted the tightest average in our sample, with PointsBet, Ladbrokes and Unibet clustered in the high-5% range. bet365 recorded the widest average margin here — though note its sample was the smallest (30 markets) and its market coverage and depth ratings (9.6 and 9.5) are the highest of the group, meaning it prices markets many rivals do not offer.
Margin measures price quality on a like-for-like market. It does not measure how many markets exist. Read the two together.
Best-price share: a second angle on value
Average margin tells you how a bookmaker prices a market in isolation. Best-price share tells you how often that bookmaker actually posts the top available price when compared head-to-head with the others in the sample.
Measured best-price share from our sample:
- Unibet — 55.97% of sampled markets at the best price (243)
- Ladbrokes — 54.65% (258)
- Neds — 35.59% (59)
- TAB — 27.12% (59)
- PointsBet — 23.53% (51)
- bet365 — 23.33% (30)
- Sportsbet — 15.91% (44)
- PlayUp — 13.64% (44)
- betr — 12.50% (56)
Note the tension: Sportsbet had the lowest average margin but a low best-price share, because its sample and the samples it was compared against differ in size. Unibet and Ladbrokes, on the largest samples, topped the best-price share — they most often held the leading price when a like-for-like comparison was possible.
Practical takeaway: no single operator wins every market. Holding accounts with two or three of the tightest-margin books and comparing prices before you stake is the reliable way to capture the best line.
How to use margin data before you bet
1. Convert the prices you see to implied probabilities and sum them. If the total is 104%, the margin is 4%.
2. Compare the same market across bookmakers. The lowest overround is the best-value book for that market, regardless of its overall average.
3. Prefer high-liquidity markets — AFL, NRL, Premier League, ATP/WTA singles — where margins are tightest, over novelty or deep-field markets where they widen.
4. Treat multis and Bet Builder prices sceptically: the compounded margin on several legs is far larger than on singles.
5. Use our live tools to shortcut the arithmetic and see where the current line sits versus the open.
Margin is the one cost you can control before a single result lands. Lowering the average margin you pay from ~7% to ~5% is a structural edge that applies to every bet you make.
FAQ
What is a good bookmaker margin in Australia?
On tight two-way markets, anything at or under roughly 5% is competitive. In our sample, average margins ranged from about 4.9% (Sportsbet) to 7.4% (bet365). Bigger multi-outcome markets like large racing fields naturally carry higher margins, so judge each market on its own overround.
How do I calculate the margin on a market myself?
Divide 1 by each price to get its implied probability, add them all up, then subtract 1 (or 100%). For a two-way market at $1.90 and $2.00 the sum is 52.63% + 50.00% = 102.63%, giving a 2.63% margin.
Does a lower margin always mean better odds?
For the specific market you are betting, yes — a lower overround means the operator has shaded the true probability less, so the price is closer to fair. But average margin across a whole bookmaker is a mean of many markets, so always check the individual market you intend to bet rather than relying on the operator's overall figure.
Why did bet365 show the highest average margin but the top coverage ratings?
The two measure different things. Average margin is price quality on sampled markets; coverage and depth measure how many sports, competitions and markets are offered. bet365 rated highest for market coverage (9.6) and sports depth (9.5) while recording the widest average margin in our sample (7.44% across 30 markets). It prices markets many rivals do not carry, which is a separate value from tight pricing.
Are same-game multis worse value because of margin?
Generally yes. The legs in a same-game multi are correlated and repriced, so the effective margin on the combined bet is considerably higher than the sum of the individual single-market margins. Singles at low overround are the cleaner-value option.
How many accounts do I need to consistently get the best price?
In our sample no operator led on best price in more than about 56% of markets (Unibet), with Ladbrokes close behind. Holding accounts with two or three of the tightest-margin, highest best-price-share books and comparing before you stake is the practical way to capture the leading line.