How Sportsbooks Make Money (and Why We Devig)

Sportsbooks aren’t crystal balls. They don’t know the outcome of a game any more than you do. What they do know is how to set prices in a way that guarantees a profit over the long run. That profit comes from a built-in fee called the vig (short for “vigorish,” also called the “juice”).

What is the Vig?

The vig is the sportsbook’s commission. It’s why a standard point spread or total bet is often priced at -110 instead of true “even odds” (+100).

Take a coin flip — 50/50 in reality. If a sportsbook priced both sides fairly, you’d see +100 on heads and +100 on tails. Bet $100, win $100. But that wouldn’t make them money. Instead, they list both at -110:

Heads:  -110  (implies ~52.38%)
Tails:  -110  (implies ~52.38%)

Do the math: 52.38% + 52.38% = 104.76%. That extra 4.76% is the vig. It ensures that no matter how the bets split, the house takes a slice.

Why Raw Odds Don’t Tell the Whole Story

Those -110 prices make it look like each side is more likely than it really is. In truth, the game is still a 50/50 coin flip — the book just built in a margin. If you read raw odds as probabilities, you’ll overestimate every outcome slightly.

What Does “Devigging” Mean?

To level the playing field, we devig the odds. Devigging means stripping out the sportsbook’s margin to reveal the underlying probabilities the odds imply.

In the coin flip example:

Raw odds:
  -110 = 52.38% each side

Sum = 104.76% (includes vig)

Devigged odds:
  52.38 / 104.76 = 50.0% each side

Now you’re back to reality: 50% vs 50%.

Why We Show Market % on Fourth & Value

If you’ve looked at our Player Props tables, you’ll see two key columns:

• Market % — the devigged, fair probability implied by the sportsbook’s line.
• Model % — our own estimate of the true probability.

Without devigging, you’d be comparing apples to oranges — our “fair” model vs the book’s “padded” prices. By removing vig, we can show a cleaner head-to-head comparison.

Takeaway

The vig is how sportsbooks keep the lights on. But once you understand it, you can strip it away and see the real picture. That’s why we always devig — and why our tables focus on Market % vs Model %.

Mastering this concept is step one in betting smarter. In our next fundamentals post, we’ll dive into what we mean by edge (in basis points) and why it’s the most important column on the site.