Removing the Vig
Removing the vig normalizes sportsbook implied probabilities so they sum to 1, producing a “fair” probability estimate for comparison and evaluation.
Definition
Removing the vig means adjusting sportsbook implied probabilities to eliminate the bookmaker margin. The result is a set of normalized probabilities that sum to 1.
Simple method
For mutually exclusive outcomes, take each implied probability and divide by the total:
p_fair(i) = p_implied(i) / sum(p_implied)
Why it matters
Without removing the vig, sportsbook probabilities will look systematically too high. For forecasting evaluation and benchmarking, you want a clean reference probability, especially when comparing to market consensus style baselines.
Related
This concept is closely connected to vig, overround, and implied probability.