How does cash out work in sports betting?
Written by Short answer
Cash out = the book buys your bet back early.The offer is usually below fair value.Some books let you cash out part of a bet.On prediction markets you cash out by selling.
Cash out is the sportsbook offering to buy your bet back before it's decided. You take a guaranteed amount now instead of waiting for the result.
↔ swipe to see the whole diagram
How the offer is figured
The book looks at the live odds on your bet, figures out what it's worth right now and then takes a cut. That's why the offer is almost always a little less than fair.
Fair value = 76% × $125 = $95. Offer = $88. Cost of cashing out = $7
Partial cash out
Some books let you cash out part of the bet and leave the rest running. You lock in some money and keep some upside. The same cut applies to the part you cash out.
Cash out on prediction markets
Kalshi and Polymarket don't have a cash-out button. You sell your contracts to another trader at the best bid. The cost there is the spread plus the trading fee instead of a sportsbook's built-in cut.
When cashing out makes sense
▸The bet has grown too big for your bankroll and you want to cut risk.
▸News changed the game, like an injury, and you'd no longer make the bet.
▸You can't get a better price hedging the other side at another book.
My take
Most cash outs are fear, not strategy. If you'd still make the bet at the current price, hold it. If you wouldn't, compare the offer with hedging at another book before you click.