Whenever you make a bet with the Book, there’s a rake, some edge they retain in order to be profitable while offering you your choice of sides. Typically on NFL bets against the spread, it’s -110 which means you have to risk $110 to win $100.

This might not sound like a huge deal, but it is. In order to break even, you need to win 52.38 percent of the time. To understand this, imagine you made 100 $1 bets and won 52 percent of them. You’d win $52, lose $48 and be up $4. But remember you have to risk $110 to win $100, i.e., 10 percent more than you stand to win. So when you lost those 48 $1 bets, you actually risked $1.10 on each. That extra 10 cents times 48 = $4.80, so instead of being up $4, you’re actually down 80 cents.

If we do the same experiment with a 53-percent win rate, you win $53, lose $47, plus the extra $4.70 in rake, putting you up $6 minus $4.70 for a net of $1.30. So at 53 percent you’re up $1.30 and at 52 percent you’re down 80 cents. Accordingly, break-even is between the two, slightly closer to 52, 52.38 percent to be precise.

That’s fairly straightforward, but what about the rake on futures bets? How does that work, and how can we calculate it?

Let’s take a look, for example, at Draft Kings’ Super Bowl futures as of today (August 29.)

The first thing to realize is that +550 (for the favored Bills in this case) means if you bet $100 on the Bills to win the Super Bowl, you would win $550 in the event they do so. The second thing is that 5.5 to 1 is the same as saying 1 in 6.5. And 1 divided by 6.5 is .1538. In other words, this number implies the Bills have a roughly 15.4 percent chance to win the Super Bowl.

It’s certainly possible that’s a ballpark number for the Bills. The problem is what happens when we do this exercise for all the teams.

Do you see the rake yet? Probably not. Let’s add up the percentages.

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