A situation where a promotional event provides more value than the risk involved. This occurs when there are not enough participants to cover the guaranteed prize pool, and the casino or organiser must contribute the difference to meet the guarantee.
In many poker tournaments or other casino events, the casino guarantees a certain prize pool. For example, a poker tournament might guarantee a $100,000 prize pool. If the number of participants or the total entry fees collected does not meet the guaranteed prize pool, the casino must cover the difference. For instance, if only $80,000 is collected in entry fees for a $100,000 guaranteed prize pool, the casino adds $20,000 to meet the guarantee.
An overlay creates a positive expected value for players because the casino is effectively adding extra money to the prize pool. This means players have a better chance of winning more money than they would if the prize pool were solely funded by entry fees. Casinos may offer overlays as a promotional tool to attract more players to their events. The prospect of an overlay can be enticing to players looking for value, as it increases their potential return on investment.
