Arbitrage in Sports Betting: The Basics Explained

Sports betting is one of the world’s most popular and lucrative industries. It has only been legal in a few states for a relatively short time, but even now, it already dwarfs other forms of gambling like poker or lotteries.

The main reason why people are so interested in sports betting is that it offers so many opportunities to win money. You can win week after week, month after month or even year after year if you’re good enough. That’s why it’s important to stay up to date with the latest information surrounding this industry.

However, there are other factors that contribute to making sports betting such a popular industry — one of these factors is arbitrage betting.

What is Arbitrage?

Arbitrage is a sports-betting strategy wherein you place bets on different sportsbooks, such as online sports betting singapore sites, to make guaranteed profits no matter the outcome of the game.

It’s based on two concepts: riskless betting and equal chance. You will be placing bets with multiple bookmakers, where every bet has the same expected value. In this scenario, the chances of you winning or losing are equal, and therefore you can’t lose any money no matter what bet comes in first.

The best part about arbitrage is that it doesn’t require a lot of time, knowledge or experience to make it work successfully. You don’t need to handicap games yourself, and there is no need to follow the sports news and keep up with all the latest developments.

Types of Arbitrage

You will find different types of bets across various bet types, so we will explain to you the most common types of arbitrage scenarios:

Cash Out Arbitrage

It works on Live Betting, where you can close your bet before the event ends. There are usually offers where you can select a “cash-out” option, which means that you have the opportunity to cash out your bet at a guaranteed profit before it ends.

In-Game Arbitrage

This is an arbitrage type that works as long as there is time left for your bets to be placed. The idea is to wait for a moment in the match when the spread on some bookies drops from 3 points to 2.5 or even lower, and then place a wager with that specific bookmaker.

In-Running Arbitrage

This also applies to live bets where there are events going on at the moment. You will need to place your bets on the following outcomes:

• “First team to score”,
• “Both teams to score” and/or                                                       
• “No Goals”.

There are also other arbitrage strategies where you are betting on over-rounds, where bookmakers are giving higher odds to draw bets than they should. However, it is important that you know how to identify this type of arbitrage and take advantage if the opportunity arises.

What Are the Risks?

The biggest risk in sports arbitrage is losing your bet early before you can place another wager at a different bookmaker. This happens all of the time and is what separates the pros from the amateurs.

If you don’t like the risk of arbs, then there are other ways to make consistent money betting in sports. The only requirement is that you need to know how to calculate the odds.

For those who are experienced, you should check out betting exchange arbitrage. It’s a trading platform where you can trade different bets based on fluctuations of the prices, such as buy low and sell high. You will need money management skills to make money in this type of strategy!

How Much Money Can You Make?

This is the best part of arbitrage betting! The sky’s the limit!

Let’s say we have 1 unit, which is equivalent to $10 in your sportsbook account. If you are betting five different arbs, you will have 5 units for a total of $50. You are risking 50% per bet, which is very low if you compare it to the Kelly criterion.

How to Find the Best Opportunities

The key factor that determines your success or failure in arbitrage betting is the ability to find good opportunities. If you are not able to find enough arbs, then your profits will be minimal.

The best way to get started is to limit the number of sportsbooks that you sign up with. As a general rule, do no more than five different books. If there are too many books available to choose from, then you will get confused. You can start with online sports betting singapore site.

The next step is to learn how to compare the odds of two different books. If you can do that easily, then you are on the right track. There are many arbitrage calculators on the web that allow you to compare odds with just a few clicks. You want to be making money after your calculation and not spending 30 minutes trying to figure out if you have a play.

Arbitrage Calculator

There are different websites that offer free arbitrage calculators, but there are also paid ones. Some betting experts suggest using both types because they will point out different arbitrage offers.

Using a calculator is the easiest and the quickest way to identify opportunities, but it won’t be so helpful if you are looking for more complicated scenarios.

We will keep this example simple so that anyone can follow along.

For this example, we will use Bet365 and Pinnacle Sports as our sportsbooks. A low juice arbitrage position is one where the line at both books is less than 2% (for example, -104). If the odds of both bookies are over 2% (for example, +100), then it becomes a reverse arb.

Let’s say Bet365 is -108 and Pinnacle Sports is -104 on the same bet. The calculation for this would be: 0.5 x 5 units = 2.5 units risk (the arb) divided by 104% return.

2.5 / 1.96 = 1.22 units expected profit

If you are using $10 as your unit size, then you would expect to make $12.20 for this play (1.22 x 10). The key factor that determines how much money you can make is the juice at each bookmaker. For a low juice play, there is no bookmaker that will allow you to make more than $12.20 on every bet.

Just for comparison reasons, let’s look at a high juice arb:

Bet365: -111 Pinnacle Sports: +105

5 units x 0.5 = 2.5 units risk divided by 105% return = 2.36 units expected profit

If you are using $10 as your unit size, then you would expect to make $23.60 for this play (2.36 x 10). You can see that the juice in both books greatly affects the profitability of an arb.

Takeaway

Arbitrage betting is extremely profitable compared to other types of sports bets, but it can be equally risky. You need to be careful when it comes to choosing the bookies you are betting on because if you don’t do your homework properly and pick a high-risk one, you could lose all the money invested in this type of strategy.