Half of what is staked reaches the fund

A draw is not a game with a house edge set by its volatility. It is a split. Every ticket sold is divided by declared percentages between a prize fund, the operator, the retailer and the state or good causes, and that split is the return the product is built around. This page follows one sample draw through the whole division.

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Draw ticket

Sheet: DD-57-05
Subject: The split
Sample draw: 2,000,000 tickets at 2.00
To the prize fund: 50% of takings

3 tiersA printed sum: the rules state the amount, and it pays whoever matched, however many that is

1 tierA split fund: a declared share of the prize fund, divided among the lines that matched it

1 tierCarried forward: an unwon share of the fund moved into a later draw instead of paid

Direct answerThe money taken for tickets in a draw is divided by declared percentages. In the sample draw used across this desk, half of it becomes the prize fund, a quarter goes to the state or good causes, a fifth to the operator and a twentieth is retail commission - so the expected return on a ticket is the prize-fund share and no more, unless a rollover is being carried into that particular draw.

The split is the returnHalf to the fundA quarter to causes or stateA fifth plus a twentieth to the trade

Why the split matters more than the jackpot

The headline figure attached to a draw is the top-tier prize, and the figure that decides what a ticket is worth is the split. They are only loosely related: the top tier is one line in a division of the fund, and the advertised number is usually the total of that tier's share across several draws rather than the money staked in the draw on sale. A reader who wants one number to judge a draw by should use the split, because it is published as a percentage and it is the same on every ticket.

The split is also where a state-run draw differs most from a commercial one. Where a state runs the draw, the non-prize share is commonly divided between the operator, the retailer and a named cause, and the cause's share is a matter of public policy rather than of product design. The percentage reaching the fund is the part that behaves like a game's return.

What the split looks like, line by line

The ledger below is this desk's second signature component: one sample draw, 2,000,000 tickets at 2.00, followed from the counter to the last line. Read it downwards and the fund is the first line; read the rows under it and the fund is itself divided between the tiers, which is the tiers page.

Worked example - one sample draw, in full (illustrative) Tickets sold: 2,000,000; ticket price: 2.00 Taken: 2,000,000 x 2.00 = 4,000,000.00 Prize fund at 50%: 4,000,000 x 0.50 = 2,000,000.00 State or good causes at 25%: 4,000,000 x 0.25 = 1,000,000.00 Operator at 20%: 4,000,000 x 0.20 = 800,000.00 Retail commission at 5%: 4,000,000 x 0.05 = 200,000.00 Check: 2,000,000 + 1,000,000 + 800,000 + 200,000 = 4,000,000.00 - the four lines are the whole of what was taken Return per ticket, before any rollover: 2,000,000 / 2,000,000 = 1.00 Return as a percentage of the 2.00 price: 50% The second-to-last line is the one to hold on to: the expected return of a ticket is the prize-fund share, and every other line in this table is money that is not coming back.

The advertised figure and the fund are two different numbers

the advertised number What is on the poster

Usually the top tier's total on offer in the next draw, which includes money carried forward from earlier draws plus this draw's share. It is a real figure and it is not the fund: it is one tier's money, after other tiers have been provided for.

the fund What this draw put aside

The whole of the prize money this draw's sales generated, before it is divided between tiers. This is the figure a reader can compare with the takings, and the one that sets the average return.

the top tier's share A slice of a slice

The top tier does not take the whole fund. The lower tiers are paid first, at their printed or split rates, and whatever remains is the top tier's share - the tiers page works that subtraction.

the unclaimed Money that goes back

Prizes that are never claimed return to the fund or to the cause after a stated window, which is money that was payable and ceased to be. The claim page is about the window.

Where the argument is easy to get wrong

A reader who has followed the split so far should be careful of two common turns of reasoning.

The Jackpot is not evidence of generosity. A large top-tier figure is a total of shares from several draws. It can be large while the split is unchanged, because it is the same percentage accumulating rather than a higher percentage being paid.
The causes are not the operator's margin. A stated share to good causes is a line of its own in most state draws rather than a slice of the operator's share, so removing or growing it changes the non-prize total without touching the fund share - and the fund share is what returns to players.

Printed, split or carried

How the fund is divided between the tiers, and who carries a tier nobody won.

The rollover and the cap

What happens when the top tier is unwon, and the ceiling on the money carried.

The odds of each tier

The chance side of the same product, derived from the combinations.

Read the draw

Eight questions to ask of a draw’s rules before buying a ticket.