Commercial
Margin
Definition
The structural profit built into operator pricing. Used distinctly for bookmaker margin (sportsbook), house edge (casino), and overall operating margin.
Key takeaways
- Margin is used in three senses: bookmaker margin in sportsbook odds, house edge in casino games and operating margin in company accounts.
- Theoretical and realised margin differ: realised sportsbook hold depends on results, and short-run casino hold varies with volatility.
- Operating margin combines product-level margin with the cost structure, so any use of the word needs the dimension specified.
Why it matters
Margin in iGaming is used in multiple specific senses. Bookmaker margin is the structural pricing margin in sportsbook odds (synonymous with overround). House edge is the structural margin in casino games (complement of RTP). Operating margin is the broader financial measure of operator profit as a percentage of revenue. Each is calculated differently and tracks different aspects of operator economics.
The relationship between product-level margin and realised margin matters for performance analysis. Sportsbook bookmaker margin is the theoretical pricing margin; realised hold percentage is the actual return after outcomes are settled. Casino theoretical house edge is exact (set by game math); realised hold over short periods varies with volatility. Operating margin combines product-level margin with operating cost structure to give the bottom-line economic measure. Discussions of "margin" in iGaming require specifying which dimension is meant.
Frequently asked questions
Why are different "margin" terms used for sports versus casino?
Historical vocabulary. Bookmaker margin and overround come from racing and sports betting heritage. House edge comes from casino heritage. Both describe the operator's structural profit on play but use different conventional terminology. Operating margin is the broader financial measure that aggregates across products.
What's a typical sportsbook bookmaker margin?
Varies by market and event. The most competitive events (major Premier League matches, NFL games, major tennis grand slams) often have margins of 3% to 5%. Lower-profile and lower-liquidity markets run wider, sometimes substantially. In-play margins are typically wider than pre-match.