An overlay is a price longer than the fair price for a selection, so a bet at that price returns more than its chance is worth on average. Its size is measured like a betting edge: overlay = offered price / fair price - 1, which is also the bet's expected value per $1 when the fair price is 1 / your estimated chance.
Australian punters call a price like this overs, as the rated price entry does. In matched betting, overlay means a lay above the balanced stake; the punting sense is the value side of betting strategy.
Overlays in horse racing, worked
Example: Illustrative prices, not a real race. You frame a race and rate Runner 5 a 25% chance, a fair price of 1 / 0.25 = $4.00. A bookmaker offers $4.48.
overlay = 4.48 / 4.00 - 1 = 0.12, a 12% overlay
EV per $1 = 0.25 x 4.48 - 1 = 0.12, so a $15 bet is worth 15 x 0.12 = $1.80 on average
That $1.80 is an average: each bet returns $67.20 or nothing, and at 25% Runner 5 loses 75 races in 100. The same check works on any bet with a fair price (illustrative prices):
| Bet | Fair price, and where it comes from | Offered | Overlay | EV per $10 |
|---|---|---|---|---|
| Win, Runner 5 | $4.00, your rated price | $4.48 | +12.0% | +$1.20 |
| Place, Runner 5 | $2.10, the exchange place market | $2.20 | +4.8% | +$0.48 |
| Head to head, Team A | $1.60, a market with the margin taken out | $1.68 | +5.0% | +$0.50 |
Each EV is $10 x (offered / fair - 1), the sum the expected value calculator runs on your own prices: for the place bet, 10 x (2.20 / 2.10 - 1) = $0.48. Value betting horse racing shows the racing method with the exchange as the fair-price reference, and value betting the general one.
Risk: Betting involves risk. An overlay is only as real as the fair price behind it, a +EV bet can still lose, and often does, and there is no guarantee of profit. See responsible gambling for limits and support.
The matched betting overlay
In matched betting you back a selection with a bookmaker and lay it on an exchange; the balanced lay leaves about the same result either way, and an overlay lays more.
Example: Illustrative: $40 backed at $2.50 and laid at $2.56, with an illustrative 5% commission rate. Balanced lay stake = 40 x 2.50 / (2.56 - 0.05) = $39.84.
| Lay stake | Liability | If the bookmaker bet wins | If it loses |
|---|---|---|---|
| $39.84, balanced | $62.15 | -$2.15 | -$2.15 |
| $48.00, overlay | $74.88 | -$14.88 | +$5.60 |
For the overlay row: liability = 48 x (2.56 - 1) = $74.88; if the bookmaker bet wins, 40 x 1.50 - 74.88 = -$14.88; if it loses, 48 x 0.95 - 40 = +$5.60. Overlaying suits a position where an extra comes only with a winning bookmaker bet: the bigger lay shares it across both results. The back lay calculator works out any lay stake, and matched betting in Australia the method.
Risk: Betting involves risk. An overlay leaves part of the position unhedged and still needs the lay matched at your price. Many bookmakers' terms restrict or prohibit automated betting, third-party access and multiple accounts, and any bookmaker can limit stakes, void bets or close an account; that risk is yours. See responsible gambling for limits and support.
Overlay vs underlay
| Overlay | Underlay | |
|---|---|---|
| In punting | A price longer than fair, with positive EV | A price shorter than fair, with negative EV |
| Worked on Runner 5 | $4.48 against a fair $4.00: +12% | $3.72 against a fair $4.00: -7.0% |
| In matched betting | A lay above the balanced stake | A lay below the balanced stake |
| The lay leaves you better off if | The bookmaker bet loses | The bookmaker bet wins |
Underlay explains why short prices gather on popular runners.
Finding overlays with B337's screeners
B337's +EV screener runs this search across sports markets, listing bookmaker prices above the fair price and ranking them by edge; its fair price is an estimate built from the market with the margin taken out. The rows come with Terminal Pro, Full Automation or the Screeners plan; a free account shows how many prices sit above fair, with the rows locked. On racing, the Terminal's EV overlays, which start at Terminal View, show each bookmaker's price against the exchange as expected value.
Risk: Betting involves risk. A price on screen can trail the bookmaker's own, so confirm it in your account before you bet, and a +EV bet can still lose. See responsible gambling for limits and support. For free and confidential support call 1800 858 858 or visit gamblinghelponline.org.au.