Updated Updated: October 31, 2019

Arbitrage Betting | Ultimate Guide to Arbing 2019

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Sometimes, it can be hard to accurately predict the result of a sporting event, be it a football match, horse race or tennis tournament. Even super fans with all the facts at their fingertips will sometimes get it wrong, as do the bookmakers, who have large numbers of analysts working for them in order to accurately predict outcomes. This means that for the normal punter placing a wager, there is a large amount of uncertainty when it comes to trying to make a profit, with the surest bets sometimes turning into failures. This can be frustrating for many gamblers, who can sometimes begin to see sports betting as more of a game of chance than skill.

However, some punters are able to pick up a steady profit no matter what the event they are betting on is. This is done via a system known as ‘arbitrage betting’. In a nutshell, it involves comparing the odds offered and placing multiple bets so that no matter the result, a profit will be made. Obviously, this can be quite difficult to do, but if performed properly, the profits can be considerable.

This also makes it much easier to bet on sports that may be unfamiliar to the punter, as the arbitrage method only requires a direct comparison of the odds being offered on a given day. This is in contrast to trying to use limited knowledge of the sport itself in order to make a profit on a single straightforward win/loss bet, where factors such as the competitors, venue and even the weather can all have an impact on the outcome of the contest and potentially cause the punter to lose the bet.

How Does It Work?

In order to take advantage of opportunities for sports betting arbitrage, punters have to be vigilant for discrepancies in odds both on individual gambling sites and between the odds offered by different bookmakers. This means that a large amount of time is needed to comb through the various odds being offered on different events, making this method fairly unattractive for more thrill-seeking gamblers.

how arbitrage betting works

What the arbitrage punter is searching for is a set of odds on the same event whereby the payout from betting on all of them will be greater than the initial investment. This means that even after all but one of the bets have failed, the one that wins will still be able to cover the total expenditure on the others, generating a profit. It should be remembered that each bookmaker will also charge a fractional commission on each transaction, so any winnings should be able to comfortably cover this margin as well. Generally speaking, each individual stake will be for a different amount, depending on the odds being offered on that particular bet. This is to finely balance the total investment and not lead to a situation where over-committing leads to a reduced bankroll. However, properly balancing the bets will lead to some potentially large winnings depending on the size of the initial investment.

Players considering taking up arbitrage betting should bear in mind that it is based squarely on discrepancies in the odds being offered by bookmakers. Opportunities for arbitrage betting on the same site will quickly be corrected and after posting odds, bookmakers will work to compare them against those offered by their competition, leading to them being constantly revised in the run-up to an event. This means that punters need to act fast in order to take advantage of these opportunities and cannot depend on them cropping up on a predictable basis.

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Chances for arbitrage betting most often arise in the run-up to an event, as odds begin to shift in response to increased media attention and speculation. Whilst this can present an opportunity to profit, it also creates some degree of risk for the punter, as the odds can shift so rapidly that they change before the gambler has the opportunity to make all of their desired bets, leaving them without vital coverage of certain outcomes. Likewise, arbitrage betting live is very risky. Alternatively, players can place their bets months in advance of a large event, when the bookmakers will be paying the least attention to the offered odds and more time can be taken to identify and place the most lucrative set of bets.

Punters should also keep their eye on less popular or well-known sports, as these are not subjected too much scrutiny by larger bookmakers due to their relatively small share of the UK domestic market. Instead, things like Premiership football and the Six Nations rugby will tend to be the subject of the lion’s share of the bookmakers’ attention, leaving smaller sports to accrue potentially profitable odds in the background. Additionally, international sites often present opportunities to practice arbitrage betting because of the large amounts of sports being covered at any one time, leaving some favourable odds to get lost in the mix.

Using Software or Maths?

It can be difficult to consistently go about performing arbitrage bets, especially for a person who is just starting out. Fortunately, there are a few types of arbitrage betting strategy out there. These methods are split between doing things manually (working out the odds and margins alone and then placing bets accordingly) and using arbitrage betting software (which will automatically find the best odds). Both have their own pros and cons, which are laid out below.

Manual

The vast majority of arbitrage gamblers will opt to just calculate the difference in odds themselves before placing their bets. Although the idea of comparing multiple options sounds fairly intimidating and complex, the process is actually fairly simple and can be broken down into a few steps for a punter to follow in order to work out if it is worth investing their time.

arbitrage betting basic software

Firstly, the punter must find the set of odds that they like and work out whether they can make a profit. This will typically be split between two different bookmakers. For instance, one bookmaker will offer high odds of a football team winning, whilst their competing bookmaker offers high odds of them losing. The punter then works out how much money they can comfortably bet on each result and still make a profit, using the multiplication of their stake from each set of odds to find out if each bet covers the other. 

Once they are satisfied that a profit can be made, the punter enters their bets as they would normally and waits for the football match to play out. Once it has finished, they will have made a profit, no matter the result. This is because each of their bets covers the cost of the others and provides some decent winnings. However, doing things manually can be quite slow, due to the vast amount of odds that are being offered on any given day. Plus, there is some room for errors in the calculation to be made, potentially losing the punter a large amount of money.

Software

For gamblers who take arbitrage betting seriously, there are more advanced tools available than a pen and the back of an envelope. Whilst it is still fairly unusual amongst the wider community, some arbitrage players will use purpose-built software as an arbitrage bet finder; finding odds that are potentially profitable and then calculate the return on investment of a given stake.

The simplest form of software used by this group is a basic web crawler. A crawler will scour websites for data and then display it to the user in one centralised location, usually a spreadsheet or crude interface. It is then up to the punter to make decisions regarding the quality of the potential arbitrage bets that get brought up. It should be noted that many web crawlers are fraught with risk due to security vulnerabilities or potentially malicious code hidden inside them by their designers. Due to this fact, extreme caution should be exercised when interacting with third party software.

Rebel Bet software

The next level up is professionally made software that will interact with a betting exchange in order to locate the best possible odds. The computer program will then calculate the potential profit based upon parameters that the user selects and automatically offer up a list of the most lucrative arbitrage bets that can be made that day. An arbitrage bot can also locate special offers on sites and act as a free arbitrage bet finder and bonus arbitrage bet calculator. This is obviously preferable to doing things manually. However, it should be noted that such products command a premium price, such as the widely known Rebel Bet software. Additionally, even incremental changes to the layout and workings of betting sites and exchanges can cause glitches to happen, requiring constant patches from the manufacturer. Aside from this, there are many people who question the veracity of such programs’ claims of delivering large profit margins and point to reliability problems and bad updates as a reason to avoid investing.

Overall, having a good understanding of the basic principles behind the workings of arbitrage betting will pay dividends, no matter which way a punter chooses to go about their gambling.

Example

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Whilst the basics may be hard to understand, once a punter has gone to the trouble of going to sites and looking for odds that can be played against one another and then calculating the potential profits, things begin to look a lot simpler. However, for readers still trying to understand the process, the working example below should provide some insight.

A punter goes to the website of Bookmaker 1 and finds a football match is being played that afternoon. They look at the odds and see that the Home side is predicted to lose, with odds of 4/1 of them winning. They then go to the website of Bookmaker 2, where they find that the Away side is predicted to lose, with odds of 5/1 of them winning. They then see that the odds of a draw are 3/1 on both sites.

Acting quickly, the gambler places a bet of £10 on the Away side to win with Bookmaker 2 and then places a bet of £10 on the Home side to win with Bookmaker 1. An additional bet of £10 covers the possibility of a draw. Thus, they will make a profit no matter what happens. This is because a draw result at 3/1 will return £40 including their £10 initial stake, covering all three bets and still providing a £10 profit. Meanwhile, if the Away side wins at 5/1, the return will be £60. If the Home side wins at 4/1, the return will be £50. In all cases, a profit is being made despite the inevitable failure of two of the bets.

FAQs

Yes, arbitrage betting is fully inside the law, as it is simply a case of placing multiple bets at once. However, bookmakers do have the right to suspend a customer’s account for any reason and will regularly do so to get rid of profitable gamblers. Too many successful bets within a short period will typically raise some red flags with gambling site operators and eventually result in a suspension. Whilst this may seem unfair, the sites operate to make a profit and allowing a buildup of people who are sensibly exploiting the system to their advantage will ultimately begin to eat into that bottom line.

No. Arbitrage is best used in order to leverage a normal set of win/loss bets and make a tidy profit. Adding more types of wagers such as an accumulator or an ante-post bet introduces a level of complexity and unpredictability that overcomplicates the process whilst simultaneously increasing the level of attendant risk. The one exception to this would be a Best Odds Guaranteed bet, where the odds will only become more favourable over time, bringing in greater winnings. For simplicity’s sake, however, it is best to stick to the normal spread of ½ bets offered by bookmakers.

The best way is to simply start observing the betting markets with a more critical eye. Over time, this will allow a gambler to spot opportunities much easier and therefore act before the odds are corrected.

Yes. Legally, bookmakers are fully within their rights to refuse service. However, using different bookmakers to place arbitrage bets will somewhat obfuscate the matter, as they will both see different things.

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