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What are Handicaps / Spreads?
Handicapping is a way of making a sports contest more even and thus more interesting as a betting object. In betting, this is done by awarding one of the teams, the underdog, some points or goals ahead. Different names and conventions are being used for this, depending on the sport and the geographical origin of the bookmaker, but once you see through this, the basic principle is always the same.
How Handicapping Works
Consider a football (soccer) match between Austria and Brazil, with Austria being the home team. A bookmaker may offer odds on an event, where Austria is given an advantage of ½ goal in the bet. The handicap is +0.5. So, if Austria scores the most goals, with ½ a goal added, they will still have won. If the teams score an equal number of goals, with the ½ goal added, Austria will have won the handicapped bet. However, if Brazil wins (by 1 goal or more), Brazil will have won in the bet. Note that with a handicap of +0.5, the game can never end in a draw.
The exact same principle can be used in any contest between two teams or individuals, where the outcome of the contest is determined by who scores the most goals / points / ... For example, in a baseball match, where the team scoring the most runs is the winner, the handicap will be a number of runs awarded to the underdog. Handicapping is the most common type of bet in the US team sports. The handicap is often referred to as the spread.
For convenience, we'll stick to European football in the following examples, but everything translates directly to other sports. Just exchange goals for points, runs or whatever the score is called.
Our Odds Presentation
We always use the convention of listing the handicap in terms of (net) points awarded to the first of the two teams. If the handicap is negative, for instance -½, it means that team 1 is the favourite and will have goals deducted from it's score. If the handicap is positive, it means that team 1 is the underdog and will have goals added to it's score.
Draw Option / No Draw Option
The handicap might be integer, e.g., +1.0 (which means that team 1 is awarded 1 goal ahead). In this case, the contest could end in a draw - if team 1 loses with exactly 1 goal.
This can be dealt with in two possible ways: Either the bookmaker offers an option to bet on the draw, handicap with a draw option. Or he doesn't and then returns the stake (possibly deducting a minor fee), handicap without a draw option.
In the first case, the punter then has three choices, just as in a usual home / draw / away match bet. And in the latter, he only has two choices, home and away team. Just as when the handicap was +0.5. The latter principle is always used in the US sports, where draws are quite unlikely in any case due to the rules of the sports. In European football, this varies between bookmakers and some even offer both types of handicaps. The 'no draw option' type for European football is often called Asian Handicaps. Just another name.
In handicaps without a draw option, bookmakers differ in the payback percentage, which varies between 90% and 100%, with most paying back the full amount. This corresponds to voiding the bet, essentially declaring the bet unable to settle and cancelling. The payback percentages are listed at the bookmaker information pages. |
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What are Over/Under Bets?
Over/Under bets are mentioned here, because they remind a lot about handicaps. In an O/U bet, the bet is determined on the total number of goals / points / runs / sets ... scored in the match. For a European football match, the bet could for instance offer odds 2.10 for the total number of goals to exceed 2.5. Or in an American football game, the bet could offer odds 1.90 for the total number of points to exceed 35. And so on. You can offer Over/Under bets on anything, which is determined by the outcome of some single number.
As with handicaps, an Over/Under can end undetermined if the threshold in the bet, the total, is integer, e.g. the American football Over/Under with a total of 35. And again there is an issue of a payback / refund of the bet stake in case this happens.
Handicaps and Over/Unders are the same..
The similarity between handicap and Over/Under betting is particularly clear when you notice, that handicap bets are simply Over/Under-bets, where the number determining the Over/Under is the goal difference between the two teams. You will also see an identical presentation of the two types of bets at this site. |
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Combining Handicaps
For Asian Handicaps - that is, handicap bets without the draw option for European football matches - there is a further specialization often used, the combination of two different handicaps.
Handicap (+½,+1)
For instance, an Asian Handicap bet could be an offer of odds 1.90 for Austria to beat Brazil at home with handicap (+½,+1). This handicap is also sometimes listed as +¾, which can be quite confusing and is a bad methodology. What handicap (+½,+1) means is, that the punter will be rewarded as if he placed 50% of the stake on the bet with handicap +½ and 50% of the stake on the bet with handicap +1.
In the example, the punter will get a payout of 1.90 if Austria draws or wins. And he will lose his money if Brazil wins by two goals or more. Why? Because these are the payout for both handicap +½ and +1.
If Brazil wins by 1 goal, e.g. final score Austria 0, Brazil 1, then handicaps +½ and +1 differ. The punter's money will be lost in case of handicap +½, giving a payout of 0, while the game will be tied in case of handicap +1, giving a payback of the original stake. Mixing the two together, fifty-fifty, the punter receives 0.5 x 0 + 0.5 x 1 = 0 + 0.5 = 0.5.
Handicap (0,+½)
If the handicap is (0,+½), the two handicaps in the combination will differ if the game is tied, e.g. final score Austria 1, Brazil 1. For handicap 0, the game is tied and the punter is returned his stake, a payout of 1. For handicap +½, Austria is the winning bet, and the punter receives a payout corresponding to the odds offered, 1.90. Mixing the two together, fifty-fifty, the punter receives 0.5 x 1 + 0.5 x 1.90 = 0.5 + 0.95 = 1.45. |
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