> For the complete documentation index, see [llms.txt](https://docs.parlayit.gg/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.parlayit.gg/concepts/parlays.md).

# Native Parlays

A parlay combines multiple market positions into one trade.

Each selected outcome is called a leg. A parlay has its own YES and NO tokens.

If you hold the YES token of a parlay, every leg has to resolve as a winner. If even one leg loses, the YES token loses.

If you hold the NO token of a parlay, at least one leg has to lose. The NO token wins when the full parlay does not hit.

## Why Native Parlays Matter

On many prediction market platforms, parlays are treated as a separate layer from the underlying markets. ParlayIt is built differently.

Parlays are part of the core product. Users can build combinations from supported ParlayIt markets, and those combinations can be quoted as they are formed.

That matters because the platform does not need to rely only on a small set of pre-listed combinations. A user can start from individual markets, combine the outcomes they want, and review the quoted parlay before placing it.

## Legs And Combined Outcomes

Each leg keeps its own market outcome, but the parlay settles as one combined position.

For example, the YES side of a three-leg parlay only wins if all three selected outcomes win. Two correct legs are not enough.

The NO side of that same parlay wins if one or more of the selected outcomes loses.

This is why parlays can offer a different risk and reward profile than trading each market separately.

## Examples

### Two-Leg Parlay

Suppose you build a parlay with two legs:

* Bitcoin closes above $100,000 on Dec 31: **YES**
* Lakers win the NBA Finals: **YES**

If you hold the **YES** token of this parlay, both events need to happen. If either one resolves NO, the YES token loses.

If you hold the **NO** token of this parlay, at least one of these needs to not happen (Bitcoin failing to close above $100,000, the Lakers losing the Finals, or both) for the NO token to win.

### Three-Leg Parlay

Suppose you build a parlay with three legs:

* Market A: **YES**
* Market B: **YES**
* Market C: **NO**

If you hold the **YES** token of this parlay, all three selected outcomes need to be correct. Market A and Market B need to resolve YES, and Market C needs to resolve NO.

If any selected outcome is wrong, the YES token loses and the NO token wins.

### Dollar Example

Suppose the three legs above each price at $0.50 on the YES side. Because all three outcomes need to land together, the combined parlay YES price comes in much lower than any individual leg, roughly $0.125 in this example.

Buying 100 parlay YES shares for about **$12.50** would settle for **$100** if every leg lands. If any leg misses, those shares settle for $0.

The trade-off works in both directions: a parlay can offer a significantly larger payout than trading each market individually, in exchange for requiring every selected outcome to be correct.

## Parlay Building Rules

When you build a parlay, the following rules apply to the legs you select:

* **Between 2 and 5 legs.** A parlay must include at least two markets and no more than five.
* **No duplicate markets.** The same market cannot appear twice in the same parlay, even with opposite YES/NO selections.
* **YES or NO per leg.** Each leg must select either the YES or NO outcome of its underlying market.
* **Only markets currently open for trading.** Markets that are paused, resolved, or closed cannot be selected as legs.
* **No nested parlays.** Every leg must be a regular binary market. A parlay cannot itself be a leg of another parlay.
* **No mutually exclusive markets from the same event.** When ParlayIt lists multiple markets for the same event with only one possible winner (for example, separate markets for each candidate in an election), those markets cannot be combined as separate legs.

In addition to these rules, the ParlayIt team can block specific market combinations when the outcomes are obviously correlated. Common examples include two markets that resolve based on the same underlying event, or markets that have been tagged as related.

## 50/50 Legs In Parlays

If one of the underlying markets resolves 50/50, the parlay payout is reduced by a 0.5 multiplier for that leg. Two 50/50 legs reduce the payout to 25%. See [The 50/50 Case](/concepts/resolution.md#the-5050-case) in the Resolution page for the full explanation.

## How A Parlay Settles

```mermaid
flowchart TD
    A[Parlay placed with N legs] --> B[Underlying markets resolve]
    B --> C{Every leg a clean winner?}
    C -->|Yes| D[YES side wins, full payout]
    C -->|At least one clean loss| E[YES side loses, NO side wins]
    C -->|Some legs resolved 50/50| F[Payout reduced by 0.5 per 50/50 leg]
    D --> G[Settlement applied to positions]
    E --> G
    F --> G
```

## Next Steps

For the user-facing flow of building and placing a parlay, see [Build A Parlay](/using-parlayit/build-a-parlay.md) and [Quotes And Liquidity](/using-parlayit/quotes-and-liquidity.md).