Pinnacle No-Vig Price (NVP) — De-vigging Guide

Summary

The Pinnacle Odds Dropper's guide on de-vigging Pinnacle odds is a practical, worked-example guide to removing the vigorish from Pinnacle's sharp odds to get fair probabilities. Pinnacle is the sharpest bookmaker, with typical vig of only 2-3% on major football markets — removing this margin gives the closest estimate of true fair odds available from public data.

The guide covers four de-vigging methods: multiplicative (Shin), additive, Shin method, and power method. It recommends the power method for accounting for favorite-longshot bias — the well-documented tendency for longshots to be overpriced relative to fair odds.

Four De-vigging Methods

1. Additive Method (Basic):
Divides each implied probability by the total overround. Simple but can produce probabilities > 1 for extreme favorites.

2. Multiplicative Method (Shin):
More statistically sound — distributes vig proportionally. Favorites receive more vig than longshots under this method.

3. Shin Method:
Named after H. Shin (1993), specifically designed for favorite-longshot bias. Uses a square root approach:
$$p_{fair,i} = \frac{p_{implied,i}}{\sqrt{p_{implied,i} \times p_{implied,j}}}$$

4. Power Method (Recommended):
$$p_{fair,i} = \frac{p_{implied,i}}{p_{implied,i}^{1-\lambda} \times O^{\lambda}}$$

Where λ is typically0.5. This is the Pinnacle Odds Dropper's recommended method.

Worked Example (from guide)

Pinnacle odds: Home 1.95, Draw 3.80, Away 4.20

Implied probabilities:
- Home: 1/1.95 = 0.5128
- Draw: 1/3.80 = 0.2632
- Away: 1/4.20 = 0.2381
- Total overround:1.0141 (1.41% vig)

Multiplicative de-vig:
- Fair Home: 0.5128 / √0.5128 =0.505
- Fair Draw: 0.2632 / √0.2632 = 0.259
- Fair Away: 0.2381 / √0.2381 = 0.235
- Sum: 0.999 ✓

NVP (No-Vig Price):
- Home NVP: 1/0.505 = 1.98
- Draw NVP: 1/0.259 = 3.86
- Away NVP: 1/0.235 = 4.26

Notes

  • This guide is the best practical reference for de-vigging Pinnacle odds — the existing de-vigging.md note covers the theory, this source adds worked Pinnacle examples
  • The power method recommendation is important: it accounts for the favorite-longshot bias where longshots are systematically overpriced
  • For the World Cup model: Pinnacle's odds are the gold standard reference; de-vigging their closing odds gives the best available estimate of true fair probabilities
  • The guide notes that Pinnacle's typical vig (2-3%) is much lower than soft books (5-10%), making their odds much closer to fair
  • Key insight: the de-vigging method choice matters most for longshot markets — for World Cup group stage 1X2, all methods give similar results
  • The NVP (No-Vig Price) concept is directly used in the client's model: compare model probabilities to Pinnacle NVP to find +EV bets