As Parlay Legs Increase, So Do Sportsbook Holds

Parlay bets are skyrocketing in popularity, and it’s not too hard to understand why.

Payouts can be large, and the rush of hitting two or more legs can be exhilarating. That goes for North Carolina sports bettors, who have been placing them over the last month.

But in reality, it’s not always the smartest wager. With higher payouts come sky-high odds. The sportsbook operators know this, too.

Here’s a closer look at just how much parlay betting has grown over the last few years and the risks involved.

More 10-leg parlays are being bet now than ever before

North Carolina sports betting launched on March 11. Players have eight online sportsbooks to choose from in the Tar Heel State and most offer many ways to build parlays. And if parlay building sounds daunting, they even offer curated parlay offers.

Citizens JMP Securities, an investment banking firm, released a statement earlier this month with data from Juice Reel. The findings showed that the average number of legs in a parlay bet has grown from 4.2 to 5 over the past three years.

If a five-leg parlay sounds daunting, consider that parlays with 10 or more legs now account for 10% of the total parlay bets placed in 2024, according to JMP’s data. That’s 2% more than in 2022.

While the numbers of two-leg and three-leg parlays have decreased from 2022 to 2024, six-leg, eight-leg and 10-leg parlays have all increased in frequency. 

More parlay betting equates to higher holds for sportsbooks

A sportsbook operator’s hold is the amount of money it keeps after a wager has concluded. It should come as no surprise that operators enjoy a higher hold on parlays because the odds are significantly in their favor.

And over the last few years, that hold percentage has climbed.

In 2021, sports bettors across the country wagered $57.8 billion on parlays. Operators collected $4.35 billion in revenue off of those wagers, which translated to a 7.5% hold.

The following year, $93.7 billion was wagered on parlays. Operators saw their hold percentage rise to 8.1%, as they kept $7.59 billion in revenue from parlays.

According to Legal Sports Report, data from January to October 2023 saw that hold percentage remained on the rise, coming in at 9.5% hold on parlay bets. Legal sportsbooks collected $8.5 billion in revenue off $89.9 billion wagered.

Sportsbooks pushing parlays now more than ever

For North Carolina residents logging into their favorite sportsbook, chances are parlays will greet them upon opening the app. Each sportsbook will offer hand-crafted parlays for customers. They’re often right on the home screen.

DraftKings CEO Jason Robins called parlay betting a “win-win” for both customers and the sportsbooks. 

“We’ve seen no decline in demand as we’ve increased hold rates. The important thing is we’re not increasing it by making the odds any worse for customers. It’s just by pushing more parlay mix and things like that.”

JMP’s research shows that for every additional leg a customer adds on their parlay, it equates to a 1% or better gaming margin for the operator. It’s 1% for BetMGM Sportsbook NC and ESPN Bet, 1.1% for DraftKings Sportsbook NC and 1.3% for FanDuel Sportsbook NC.

Risks rise in proportion to the number of legs in a parlay

Robbins said DraftKings is not trying to take money from bettors when they promote parlays.

“What we’re not looking to do is take money from people by forcing them into bets they don’t want. What we are trying to do is get smart at lining the sharp action, and then also making sure that we have a high parlay mix because people like that. Every quarter, the parlay as a percentage of the total bet mix goes up.”

But in reality, parlays have become operators’ best friends, JMP reported.

“We believe Americans with a background in long-shot lottery odds are opting for longer-legged parlays, with a noticeable uptick in high-single-digit, or 10-plus leg parlays in recent years.”

And that’s essentially what a 10-leg parlay is: a lottery ticket. A player could spend a couple of dollars and win hundreds or thousands. Like a lottery, though, the chances of winning a massive payout are slim.

It’s a good reminder for North Carolina residents to practice responsible gambling when wagering on sports, especially when parlay betting.

Knowing and sticking to your limits is key. As legs grow in a parley, the higher the odds of winning become. They can be tempting. But just remember, for every multiple-leg parlay that pays off, there are thousands that don’t.

Sportsbooks are banking on it.

About the Author

Adam Hensley

Adam Hensley's byline has appeared in the Associated Press, Sports Illustrated and sites within the USA Today Network. Hensley graduated from the University of Iowa in 2019 and spent his college career working as an editor and reporter for the Daily Iowan’s sports department.