Free bets: why stake-not-returned changes the value

The rest of this page works through the maths behind that gap, with the formula checked against fully worked examples at three different odds, so it is easy to see exactly where a free bet's value goes and why the price it is used at changes the answer.

The stake-not-returned mechanic

A normal cash bet has two parts to its payout if it wins: the stake comes back, and the profit is added on top. Bet £10 at odds of 2.00 and a win returns £20, made up of the £10 stake plus £10 profit.

A free bet works differently. Because the bookmaker is providing the stake rather than the bettor, most operators do not hand that stake back even on a winning bet. This is the stake-not-returned (SNR) structure, and it is the most common form of free bet offered by UK bookmakers. Win a £10 SNR free bet at odds of 2.00 and the return is £10, the profit only. There is no stake to give back, because the bettor never staked their own money in the first place.

If the bet loses, nothing is lost either way, since it was never the bettor’s own stake. The whole value of an SNR free bet lives in the profit it can produce if it wins, and that is exactly why its real worth sits below its face value: a chunk of what would normally come back as stake on a winning cash bet never gets paid out at all.

Normal bet vs SNR free bet, same odds

Take odds of 2.00 and a £10 amount, once as a normal cash bet and once as an SNR free bet.

The free bet pays out half of what the equivalent cash bet would return. That is not a bookmaker error or a small-print catch, it is how SNR free bets are built. The face value printed on the offer is not the amount that lands in the account on a win.

The value formula

The gap between face value and real value is not fixed, it shrinks as the odds get longer. That is because the stake makes up a smaller share of a winning cash bet’s total return at long odds than at short odds, so not getting the stake back costs relatively less.

The standard way to estimate an SNR free bet’s true cash value treats it as an expected value calculation at the fair, no-margin implied probability for the odds used. The fair implied probability at decimal odds O is 1 divided by O, and the free bet’s profit if it wins is face value multiplied by (O minus 1). Multiplying those together and simplifying gives:

Worked examples at three odds levels

Three examples, each starting from the fair implied probability for the odds used, so the arithmetic can be checked step by step rather than taken on trust.

At odds of 2.00, a £10 face value free bet pays £10 profit if it wins. The fair implied probability at 2.00 is 1 divided by 2.00, which is 50%. True value is 50% of £10, which is £5.00, exactly half the face value. That matches (2.00 - 1) divided by 2.00, which is 0.50.

At odds of 3.00, a £25 face value free bet pays £25 x (3.00 - 1), which is £50 profit if it wins. The fair implied probability at 3.00 is 1 divided by 3.00, which is 33.3%. True value is 33.3% of £50, which is £16.67, or 66.7% of the £25 face value. That matches (3.00 - 1) divided by 3.00, which is 0.667.

At odds of 6.00, the same £25 face value free bet pays £25 x (6.00 - 1), which is £125 profit if it wins. The fair implied probability at 6.00 is 1 divided by 6.00, which is 16.7%. True value is 16.7% of £125, which is £20.83, or 83.3% of the £25 face value. That matches (6.00 - 1) divided by 6.00, which is 0.833.

Moving from 2.00 to 3.00 to 6.00, the same free bet keeps a bigger and bigger share of its printed face value: 50%, then 66.7%, then 83.3%.

Why longer odds tend to suit a free bet better

Since (odds - 1) divided by odds climbs toward 100% as the odds get longer, a free bet placed at long odds keeps more of its face value than the same free bet placed at short odds. This is the maths of the SNR structure, not a claim about which specific match or price will win. Using a free bet on a short-odds favourite is the least efficient use of it in pure value terms, because that is where the missing stake costs the most relative to the size of the bet.

This does not mean betting a free bet at the longest odds available is automatically the right call. The odds still need to reflect a reasonable chance of winning for the free bet to pay out anything at all, and a longer price with little real chance of landing has a low expected return regardless of how much of the face value the formula says it retains. This is a maths point about value retention, not a tip about which selection to make. See what is expected value for how probability and payout combine into a single number, and what are fair odds for how the fair, no-margin probability behind these calculations is worked out.

Stake returned (SR) free bets are different

Not every free bet is SNR. A smaller share of bookmaker offers are stake returned (SR) free bets, where a winning bet pays the stake back on top of the profit, exactly like a normal cash bet. An SR free bet is worth its full face value, since there is no missing stake to account for in the maths above.

SR offers are less common than SNR ones. It is worth checking an offer’s terms and conditions to see which type applies before working out what a free bet is actually worth, since the two types can differ enormously in real cash terms at the same face value and the same odds.