The formula
break-even hit rate = (price + fee per contract) ÷ 100
A contract bought at 40¢ with a 1.68¢ fee costs 41.68¢ all-in. It pays 100¢ when it hits, so it has to hit 41.68% of the time for you to come out even over many trades.
Break-even by price (100 contracts, estimated fees)
| Price | Est. fee per contract | Break-even hit rate |
|---|---|---|
| 10¢ | 0.63¢ | 10.63% |
| 25¢ | 1.32¢ | 26.32% |
| 40¢ | 1.68¢ | 41.68% |
| 60¢ | 1.68¢ | 61.68% |
| 80¢ | 1.12¢ | 81.12% |
Fees estimated at 7% × contracts × P × (1 − P), rounded up per order. Check your exchange's current fee schedule.
Comparing it with your read
The break-even is the bar your own estimate has to clear. If you think a 40¢ contract hits 46% of the time, you're 4.3 points above its 41.68% break-even, about 4.3¢ of expected value per contract. If you think it hits 41%, you're below the bar even though you think the price is nearly right.
Break-even for combos
The same formula applies to a combo. A combo quoted at 29¢ with a 1.46¢ fee per contract has to hit 30.5% of the time. If its legs multiply to 25.2%, the market's own numbers say it falls short by more than 5 points.
Break-even in odds terms
If you think in sportsbook odds, convert the all-in cost instead of the price. A 41.68¢ all-in cost is about +140 in American odds, not the +150 a 40¢ price suggests. The odds converter does the conversion.
Track it over time
Your actual hit rate on a type of contract, compared with its average break-even, tells you whether that type works for you. A trade journal that records price, fees and result for every position makes the comparison easy.
