Arbitrage betting, also known as “sure betting,” is a betting strategy that involves placing bets on all possible outcomes of a sports event or event, in order to guarantee a profit regardless of the outcome. The strategy relies on taking advantage of discrepancies in odds offered by different bookmakers and exploiting them to create a situation where a profit is assured. In order to understand how arbitrage betting works, it is important to first understand the concept of odds.
Arbitrage Betting Calculator
What Odds Are?
Odds are a way of expressing the probability of a particular outcome in a sports event or market. They are usually expressed as a ratio or a fraction, and they represent the amount of money that can be won in relation to the amount that is bet. For example, if the odds of a particular team winning a football match are 2/1, this means that for every R100 bet, a profit of R200 will be made if that team wins.
Arbitrage betting works because bookmakers can offer different odds on the same event based on their analysis of the probability of each outcome. Bookies use different mathematical models to create their odds therefore not all bookies have the same odds. The odds may not differ much from bookie to bookie but the smallest of differences could make a huge impact on your winnings especially if you are taking multibets.
The key to successful arbitrage betting is to identify the discrepancies in odds and act quickly to place the necessary bets before they are corrected. This requires a significant amount of research and monitoring of odds across multiple bookmakers, as well as the ability to perform complex calculations to determine the exact amounts to be bet on each outcome in order to guarantee a profit.
For example, let’s say that there is a football match between Team A and Team B, and two bookmakers offer the following odds:
Bookmaker 1:
Team A to win: 2/1
Team B to win: 3/1
Draw: 2/1
Bookmaker 2:
Team A to win: 2.5/1
Team B to win: 2.5/1
Draw: 2.5/1
In this scenario, it is possible to create an arbitrage opportunity by betting on all three possible outcomes with both bookmakers. By carefully calculating the correct amounts to be bet on each outcome, it is possible to guarantee a profit of around 5% regardless of the outcome of the match.
This system of betting is even easier to understand when there are just two possible outcomes to a sporting event. Let’s take an example to illustrate how arbitrage betting works. Suppose there is a tennis match between Novak Djokovic and Rafael Nadal, and two bookmakers offer the following odds:
Bookmaker A: Djokovic to win – 1.80, Nadal to win – 2.10
Bookmaker B: Djokovic to win – 2.00, Nadal to win – 1.90
In this scenario, an arbitrage bettor can place a bet on Djokovic with Bookmaker B and a bet on Nadal with Bookmaker A. By doing this, the arbitrage bettor is guaranteed a profit, regardless of the outcome of the match.
Let’s assume that the punters place a R100 bet on Djokovic with Bookmaker B and a R91.50 bet on Nadal with Bookmaker A . If Djokovic wins, the bettor will receive a payout of R200 from Bookmaker B, and lose the bet of R91.50 with Bookmaker A, resulting in a net profit of R8.50. If Nadal wins, the bettor will receive a payout of R191.50 from Bookmaker A, and lose the bet of R100 with Bookmaker B, resulting in a net profit of R8.50.In this example, the arbitrage bettor is guaranteed a profit of R8.50, regardless of the outcome of the match. This is because the combined odds of the two bets are less than 100%, which means there is a profit margin for the punter.
How to Calculate Arbitrage Betting?
Here are the steps to calculate arbitrage betting:
- Find a suitable event: Look for an event with two or more possible outcomes, such as a soccer match, basketball game or horse race.
- Find bookmakers offering different odds: Identify bookmakers that are offering different odds on the same event.
- Calculate the implied probabilities: Calculate the implied probability of each possible outcome using the odds offered by the bookmakers. The formula for calculating the implied probability is:
Implied probability = 1 / decimal odds
For example, if a bookmaker is offering odds of 2.5 for a team to win, the implied probability is 1 / 2.5 = 0.4 or 40%.
- Calculate the total implied probability: Add together the implied probabilities for all possible outcomes.
- Calculate the arbitrage percentage: Divide 100% by the total implied probability to get the arbitrage percentage. If the arbitrage percentage is above 100%, then an arbitrage opportunity exists.
Arbitrage percentage = (1 / Implied probability of outcome 1 + 1 / Implied probability of outcome 2 + … + 1 / Implied probability of outcome n) x 100%
For example, if the total implied probability for a soccer match is 95%, the arbitrage percentage is 100% / 95% = 105.26%.
- Calculate the stake: Calculate the stake for each outcome using the arbitrage percentage and the amount of money you want to bet. To ensure a guaranteed profit, the sum of the stakes for all possible outcomes must be less than 100% of the total amount of money being bet.
Stake for outcome = (Arbitrage percentage / Implied probability of outcome) x Total bet amount
- Place the bets: Place the bets on all possible outcomes with the different bookmakers. If the stakes have been calculated correctly, you should be guaranteed a profit regardless of the outcome.
Conclusion
Arbitrage betting looks great on paper and looks quite easy to implement bit all that glitters is not gold. You need to make certain that you act quickly when you find a discrepancy among bookies and they are fast to detect any possible errors or opportunities for punters to make a profit. There is potential to win a lot of money but it will require lots of research and time spent perusing the different bookies on the market.
Arbitrage Betting FAQ
Is arbitrage betting illegal?
Arbitrage betting is not illegal, but is very hard find odds that allows it.
Is arbitrage betting profitable?
Yes it is, arbitrage betting is always proftable.
