Parimutuel is a specific kind of betting system in which all of the players wagers are gathered together in a pool, and the juice or “big” is then deducted, and the payout odds are determined by sharing the pool among all the winning wagers from the bet. Sometimes the parimutuel bet is less commonly known as the Tote.
This form of betting differs from the more common fixed-odds betting in that the final payout is only decided once the pool is closed and betting has stopped. So when using Parimutuel format of betting on sports, logic suggests that the larger the participating crowd in the sports betting event would also mean larger payouts for those that place in the money, or whatever the pre-agreed upon final placement system is. For example sometimes 1st, 2nd, and 3rd places will take a larger percentage of the collective pot, leaving smaller winnings for the rest. The payout structure is usually very unique to each event, and some examples of this betting format can be seen in betting pools like with Fantasy Football, baseball, and basketball.
At the other end of the spectrum is fixed-odds betting already has the line set and agreed upon when a player actually places their wager. This is by far the most common means of betting on sports and the way sportsbooks conduct their payouts to clients. Whenever you’re betting by yourself at a local sportsbook or even an online sportsbook, a fixed-odds wager is usually what you’ll be placing. This still deducts the “Juice” or “Vig” fee that goes to the casino or allowing you to place the wager.
Parimutuel betting is usually state-regulated, and offered in places where other gambling is usually illegal. It’s also offered at off-track facilities, where players can place their wagers without actually attending the event in person.