What is a parlay bet?

A parlay bundles two or more bets into one ticket that pays only if every leg wins. The attraction is the payout: each leg’s odds multiply, so three −110 legs combine to +596 — $100 becomes $695.79, where $100 split across the three legs as singles returns just $190.91 if all three win. The catch hides in the same multiplication: your win probability multiplies too, and three independent 50/50 shots cash together just 12.5% of the time.

Pricing a parlay is pure decimal arithmetic. Convert each leg to decimal odds and multiply: 1.909 × 1.909 × 1.909 = 6.958. Subtract 1 and multiply by 100 for the American price: +596. Implied probability is 1 ÷ 6.958 = 14.4% — the ticket must win 14.4% of the time to break even, but three fair coin flips only deliver 12.5%. That 1.9-point gap is the vig compounding right along with the payout.

The margin multiplies faster than you do

Each leg carries its own vig, and parlays stack them. Three legs at a 4.55% hold do not cost you 4.55% — the effective margin on the combination runs closer to 13%. Books promote parlays relentlessly for exactly this reason: they are the highest-hold product on the menu. A bettor who would beat singles slowly bleeds on parlays quickly.

There is one honest exception. When every leg is individually +EV at the price you are getting, the parlay of those legs is also +EV — the edges multiply along with the margin. And correlated same-game parlays can be mispriced when the book’s model undercounts how the legs interact. Both cases require pricing each leg against fair first, which is the opposite of how parlays are usually assembled.

Same-game parlays

SGPs combine legs from one game — a pitcher’s strikeout over with his team’s moneyline — and the book prices the correlation into a worse combined payout than independent multiplication would give. That is not automatically a bad deal, but it means the quoted price must be compared against a fair model of the combined event, not against the naive multiplication of the legs.