What is a round robin bet and why smart bettors use it to reduce risk?

Contents:

1. Round Robin Meaning
2. How Does Round Robin Work? Understanding the Structure
3. Round Robin Parlay Explained: Is It the Same Thing?
4. Round Robin Bet Example: Step-by-Step Breakdown
5. 3 Team Round Robin Example
6. 4 Team Round Robin Example
7. 5 Team Round Robin Example
8. 6 Team Round Robin Example
9. 7 Team Round Robin Example
10. 8 Team Round Robin Example
11. What Is Round Robin on FanDuel?
12. Pros and Cons of Round Robin Betting
13. When Should You Use a Round Robin Strategy?
14. FAQs
15. What happens if one leg loses in a Round Robin?
16. Can you lose money even if most picks win?
17. Are round robin bets profitable long term?

A Round Robin Bet is a bet which allows you to strike three or more selections and in doing so, creates a number of individual bets (that contain selections from the original list of selections) and increases the number of bets and the amount staked, but ensures that all possible permutations are covered.

Volatility in sports betting can completely wipe out a bankroll. Even for the very skilled handicapper, bad luck can occur and a string of losses can happen if there is a bad break in a large parlay. Many newcomers to the world of sports betting are asked this question: What is a round robin bet and why would a sharp bettor use this type of wager? A round robin bet helps to limit the risk in a bet. It is very different from a parlay wager, where all of the wagers must be successful in order to receive a pay-out. With a round robin bet, a bettor is able to afford to lose one or more of the wagers that are included in the bet, while still turning a profit.

We all have plays that we just can’t drop and plays that don’t fit into our parlays. The round robin helps to break down these larger quantities of picks into smaller parlays. In this article we will look at the theory, strategies, and practices of the round robin.

Round Robin Meaning

This round robin meaning is called parlay insurance, and as you can probably guess, it’s a term that involves a lot of mathematics. A round robin is not a single wager, but rather a collection of many parlay wagers that are derived from a list of choices.

If you choose 3 or 4 teams in a parlay, they are all linked and if one of the teams loses, your bet is lost. A round robin is a bet that selects the chosen teams and creates all possible 2 team parlay wagers. If a team loses in a round robin the parlay wagers that do not include the losing team will pay. A round robin is a much larger volume of wagers than a parlay and thus eliminates the so-called “lottery ticket” element of parlay wagering, where the bettor chooses a few key events, wagers a modest amount, and gambles for a very large pay-out.

How Does Round Robin Work? Understanding the Structure

In order to understand how a round robin works, you must first understand the combinations involved. A round robin interface is a form where you choose a group of teams (legs) and a number for the round robin and the size of parlays you want to have created.

Bookies use the combination formula: ($\binom{n}{k}$(kn​), pronounced “n choose k”) to determine the number of possible parlay (bet) combinations in a set of wagers. where n is the number of individual wagers and k is the number of parlays.

Let’s say you are picking 10 teams to be in your DFS lineups and you want to buy a round robin of 2 team parlays (aka ‘by 2s’). The number of individual bets in a round robin is given by the combination formula:

So, in this scenario, there would be 45 individual bets in the round robin:

The same works with ‘by 3s’. You would have 120 total bets in a round robin of 10 teams, 3 team parlays. In any case, there is a price to pay for every combination. In this case with a unit price of $10, a 10 team round robin of 2 team parlays would be $450. You should verify that you have enough money for whatever it is you are buying, to ensure it’s in line with your bankroll management.

Round Robin Parlay Explained: Is It the Same Thing?

A round robin parlay explained: Is it the same thing? Not quite. While casual sports bettors may refer to both as one and the same, there is a slight distinction.

A parlay is a type of bet where a single ticket has every leg requiring a win. A round robin is a way to turn multiple parlays into a single ticket. Yes, you read that right – the legs of a round robin are themselves parlays.

The risk profile is also reversed. A standard 5-leg parlay carries the highest risk, and also offers the greatest potential payout. In a 5-team round robin consisting of ten 2-team parlays, the risk of the investment is considerably reduced. Where the standard parlay provided the same probability of winning for all winners, as here, we know that there is no relationship between the events, other than the absence of a single loss. A single loss destroys the parlay. A single loss reduces the margin of profit in the round robin.

See also: What does push mean on Dabble? Understanding push bets and refunds

Round Robin Bet Example: Step-by-Step Breakdown

The only way to truly understand this is to look at a round robin bet example in a step-by-step fashion.

We were pretty high on a number of games this week and the NFL being the NFL, it went and turned one of the upsets into what could be a disastrous Sunday for a number of ticket holders. Now that we have the numbers, we will let you know how things played out for each of our By 2s and By 3s ticket recommendations.

3 Team Round Robin Example

This is your standard entry point. A 3 team round robin example would be selecting 3 teams and choosing ‘By 2s’. This would give you 3 separate 2 team parlays.

The Selections:

• Leg A: Kansas City Chiefs (-150)
• Leg B: Buffalo Bills (-130)
• Leg C: Philadelphia Eagles (+110)

The Combinations (3 Bets Total):

• Chiefs + Bills
• Chiefs + Eagles
• Bills + Eagles

The Outcome:
If the Chiefs and Bills win, but the Eagles lose:

• Bet 1 (Chiefs + Bills) WINS.
• Bet 2 and Bet 3 (involving Eagles) LOSE.

If you have a 3-team parlay that includes the Eagles, one loss will see you lose no action in this game, but you’ll still have one winning ticket. The pay-out of the winning ticket won’t necessarily come close to covering the amount of money you lay out, but at somewhat lower odds it may at least give you a chance to push, and at somewhat higher odds you’ll still come out ahead.

4 Team Round Robin Example

In this example, we select a 4-team round robin, which significantly increases the number of outcomes covered. By choosing 4 teams and selecting “by 2s,” the math works out so that you will have 6 separate bets ($\binom{4}{2} = 6$).

Structure:

• Legs: A, B, C, D
• Bets: AB, AC, AD, BC, BD, CD

If Leg A loses, the combinations that will lose are AB, AC, and AD. Thus, BC, BD, and CD are still in the game. If BC, BD, and CD manage to win, you will have 3 winners out of 6 legs. Hence a 50% win rate for a leg that initially looked destined for the graveyard of losers in a 4-leg parlay.

5 Team Round Robin Example

The last example was a small 4 team round robin which involved a small number of selections. A 5 team round robin is a large number of selections. Selecting 5 teams ‘By 2s’ will provide 10 individual bets.

Risk Analysis:
If you stake $10 per bet, your total investment is $100.

• Scenario: You go 3-2 (3 wins, 2 losses).
  If the 3 winning teams form winning parlays.
• Parlays consist of teams A, B, and C only.
  Letters represent maths numbers, as shown below. Winners are determined by having any two of the three letters A, B, or C appearing together. So the winning tickets are AB, AC, and BC. Win 3, lose 7.

The Cards face a couple of big challenges this week and it’s going to be tough to improve on last week’s 3-2 record. However, the pay-out should be decent enough to make up for the vig, and while you won’t get rich with a 3-2 record, you’ll still be cashing some decent cheques. A $100 5-leg parlay that paid $0 would be a real nightmare.

6 Team Round Robin Example

6 Team Round Robin Overextension: Casual bettors often overextend when they realise that a short round robin of 6 games will result in a large number of selections. If the bettor decides to pick ‘By 2s’ there will be 15 bets. If the bettor decides to pick ‘By 3s’ there will be 20 bets

Selections: Teams A through F.
Total Stake: At $10/bet ‘By 2s’, you risk $150.

If you go 4-2 in a round robin, you win every 2-team combination from the 4 winners. Maths: ( binom{4}{2} = 6 ) winning tickets. You cash 6 tickets and lose 9. The parlays’ odds are multiplication so that although you may not always come close to the $150 profit for a slightly less than 80% success rate, you will more than likely keep your pay-out in the ballpark of an average of only a slightly less than perfect handicapping performance.

7 Team Round Robin Example

For a 7 team round robin example, the combinations become aggressive.

• By 2s: 21 bets.
• By 3s: 35 bets.

Bankroll management is crucial in order to last. Betting $5 on the ‘By 3s’ risks $175. You want to win about 5 out of 7 to come out with a profit or at least break even. More losses than that and you’ll be losing bankroll very fast.

8 Team Round Robin Example

A classic 8 team round robin is typically the maximum that a strategic bettor will attempt to handicap.

• By 2s: 28 bets.
• By 3s: 56 bets.

These types of parlays are very costly. If you choose 8 teams ‘by 3s’ you are making 56 individual wagers. If 5 of the legs win, you would be cashing 10 of the 56 tickets. The 10 wins to 46 losses ratio shows how difficult it is to make a profit on large round robins unless you have a very high winning percentage. This is most often used as a hedge on high-priced underdogs.

What Is Round Robin on FanDuel?

Specific sportsbooks have nuances, so what is round robin on FanDuel?

FanDuel helps with this. Once you add 3 or more selections to your ticket, the ‘Round Robin’ option will appear at the bottom of your bet slip.

• Selection: You tap the tab and FanDuel will show you your options for selections. For example, it may show ‘By 2s x3 wagers’ or ‘By 3s x1 wager’, etc.
• The Stake: The amount to wager on each pick. If you see ‘x3 wagers’ and enter a $10 stake, your total wager will be $30.
• Optimisation: One of the nice features of FanDuel is the ability to create more complex parlays such as Patents and Yankees by selecting multiple parlay sizes at once. The majority of daily fantasy sports optimisers, however, default to the ‘by 2s’ paradigm.

See also: What is a unit in sports betting? how to use and manage your wagers like a pro

Pros and Cons of Round Robin Betting

Before allocating capital, weigh the pros and cons of round robin betting.

Pros:

As all the outcomes are known to you in advance, you do not have to worry about getting eliminated from potentially winning due to bad beats, injuries, or variance.

• Variance Reduction: Smoothing out the “all-or-nothing” volatility of standard parlays.
• High Ceiling: If you sweep the board (win all legs), you win every single combination, and often the payout will be higher than a standard parlay due to the compounding effect.

Cons:

• High Upfront Cost: Funding 10, 15, or 28 bets requires a larger bankroll.
• The sportsbook always collects vig on every single wager. In those rare cases where the respective wins and losses in a particular contest appear to be evenly balanced, the vigorish built into the odds and point spread will always work to the detriment of the player.
• False Security: You can still lose your money with a winning record. We can think of the following scenario: If you choose to play a round robin and have five selections for the period where the tickets are valid, you have to win three of them to show a profit, or else the losses will more than wipe out the winnings from the winning picks.

When Should You Use a Round Robin Strategy?

This article will focus on the round robin and explain when to use it. It really comes down to the correlation of your legs and the odds of each leg.

1. High-Risk/High-Reward Picks: This is a great way to attack underdog plays, long-odds props (such as First Touchdown Scorer), and is a great way to play 4 legs. The payouts on individual legs of a round robin will be enormous (300+). With only 2 legs needed to win, you will also be paid on the legs that do win.
2. Correlated Outcome Hedging: If you like 3 NFL home favourites but are worried about one blowing an easy lead, you can limit exposure with a round robin.
3. Avoiding “Square” Parlays: You are losing 5-leg parlays by one leg too often? Then it is time to start using round robins.

FAQs

What happens if one leg loses in a Round Robin?

So, what if one leg loses in a round robin? You don’t lose the entire wager. You lose only those parlay combinations that included the losing leg, and collect on the other combinations that include only winning teams. This is one of the great things about round robins.

Can you lose money even if most picks win?

Can you lose money on a round robin even though the majority of your selections win? Yes. Although this is rare, it is possible, more often related to low-odds favourites. Even though you may win more than 50% of the legs of your round robin, you can still lose money if the odds of the favourites are low and the cost of the round robin is high. An example of this would be a 5-team round robin with 10 total bets where you won 3 legs. You now have 3 winning tickets that may not pay enough to cover the cost of the 7 losing tickets that you laid out to acquire the winning 3. Thus, you could be a loser in a situation where you win more than 50% of the legs of your round robin. It’s just the way the mathematics works out.

Are round robin bets profitable long term?

Round robin bets are not long-term profitable. A round robin is merely a tool to structure a bet, and does not change the EV of the individual selections. If you are betting EV-negative picks, then a round robin will simply allow you to lose less money over time compared to a standard parlay. However, round robins are a much better tool to structure EV-positive plays and reduce variance when compared to a standard parlay.