Trade Ninja “EXPLAINED” series aim to help explain some popular Betting / Trading terms/areas.
Arbitrage betting, also known as “arbing” or “Sure Betting” is a technique used in sports betting where a bettor takes advantage of discrepancies in the odds offered by different bookmakers for the same event.
In arbitrage betting, a bettor places bets on all possible outcomes of a sporting event using different bookmakers. The goal is to find a combination of bets that guarantees a profit, regardless of the outcome of the event.
This is possible because different bookmakers often have slightly different odds for the same event, and a skilled bettor can exploit these differences to their advantage.
For example, suppose that one bookmaker offers odds of 2.0 on a team to win a game, while another bookmaker offers odds of 2.1 on the opposing team to win. A bettor could place a bet on both teams, so that no matter who wins, they will make a profit. Specifically, if the bettor bets $100 on the first team and $91.50 on the second team (using the odds given), then they will be guaranteed a profit of $8.50, regardless of the outcome of the game.
It’s worth noting that arbitrage betting requires careful calculation and a keen eye for spotting differences in odds between bookmakers. Additionally, bookmakers are aware of arbitrage betting and may limit the amount a bettor can wager or close their account if they suspect they are using this strategy.
Finding arbitrage bets requires comparing the odds offered by different bookmakers for the same event and identifying situations where the combined odds create an opportunity for arbitrage. Here are some steps to help you find arbitrage bets:
Identify reliable bookmakers: Start by researching and identifying reputable bookmakers with a history of competitive odds. This will provide you with a pool of bookmakers to compare.
Select an event: Choose a sporting event that has multiple bookmakers offering odds. It’s often easier to find arbitrage opportunities in popular sports like football, basketball, or tennis.
Compare odds: Visit multiple bookmakers and compare the odds for all possible outcomes of the event. Look for significant discrepancies in the odds offered by different bookmakers.
Calculate implied probabilities: Convert the odds into implied probabilities using a probability calculator or formula. Implied probability represents the bookmaker’s assessment of the likelihood of an outcome occurring.
Assess total probability: Sum up the implied probabilities for each outcome. If the total is less than 100%, an arbitrage opportunity may exist.
Identify potential arbitrage: Look for situations where the total implied probability is less than 100%. This indicates that by strategically placing bets on all possible outcomes, you could guarantee a profit.
Calculate bet sizes: Use an arbitrage calculator to determine the appropriate bet sizes for each outcome to ensure a profit, regardless of the result.
Act quickly: Arbitrage opportunities can be short-lived as bookmakers may adjust their odds to eliminate discrepancies. Therefore, it’s crucial to act swiftly to place your bets before the odds change.
Remember, finding arbitrage bets requires careful monitoring of odds across different bookmakers, and it can be time-consuming.