Abitrage Betting Strategy

Utilize this strategy and make large profits over time
Arbitrage Betting Guide

Arbitrage Betting Explained

20th Aug, 2020 10 mins read

Sports betting is designed in such a way that betting operators always keep the edge over players. They make the odds so that over a large number of bets they are always guaranteed a profit. Many people will tell you that you simply can’t beat the bookies, as they will always be one step ahead of you. However, if you know the right strategy and you understand how to use it properly, beating the bookie is not only possible, but it’s guaranteed.

Out of all strategies that guarantee you will win, one stands out as the most effective. It is called arbitrage betting, and it involves placing two separate bets on the same betting fixture. Arbing is not complicated or difficult to understand but it still requires your full attention and the ability to spot the right opportunities. If you don’t use this strategy correctly, you will definitely lose.

Arbitrage Betting example

 

Arbitrage Betting Example

Luckily for you, we are here to explain all there is to know about arbitrage betting. After reading this guide carefully, you will be able to utilize this strategy and make large profits over time. While it is simple, arbitrage betting is only profitable if you’re patient. Finding the right fixture to use arbing on can be tricky, and the profits may seem small at first.

However, once you get the hang of it, you will become an arbing specialist, which will change your perspective on sports betting entirely. In this guide, we will teach you the basics of arbitrage betting, its potential disadvantages, the legality of it, and more. We will also share some real-life examples of arbing to help you better understand this strategy. Read on!

arbitrage betting

What Is Arbitrage Betting?

Arbitrage betting is a type of a betting strategy that lets you take advantage of the odd discrepancies offered by sportsbooksArbing requires you to place two opposite bets on the same event, but in different bookies. If you do it correctly, you will be guaranteed a profit regardless of the outcome.

To understand how this strategy works, we must first explain the dissimilarities in odds in different sportsbooks. Each betting operator has its odds for a certain sports event. Although these odds tend to be similar, those slight discrepancies can make all the difference when it comes to arbing.

The way to approach arbitrage betting is to bet on the highest offered odds on one player or team, and then make a separate bet with the highest odds on the other player or team. You will need to do some calculations to see whether arbitrage betting will pay off in that specific situation.

The winning amount on each of your bets should exceed your total stake. For example, if you wagered a total of $100 on several different outcomes of the same match, each of those outcomes should carry a potential win of more than $100 for the bet to be considered an “arb”.

Arbitrage betting works best when there are only two possible outcomes, like in tennis matches or basketball games. When there is a third option available, like a draw in football (soccer), arbs can be made by placing a double chance bet. However, the more possible outcomes, the fewer chances for you to find an opportunity for arbing. Arbitrage betting rarely works with outright bets because there are just too many possibilities for the final outcome.

arbitrage betting

Advantages and Disadvantages of Arbitrage Betting

The main advantage of arbitrage betting is more than obvious – you are going to win as long as you make the right calculations. Profit is guaranteed, no matter how small it may be. You are not going to stress over the outcome of a game since it will always be going your way. On top of that, arbing is very easy to learn and requires you to only place two single bets on the same sports event.

So you may wonder why everybody is not placing arbitrage bets. First of all, not all people know about arbing. Even some seasoned sports bettors haven’t heard of the term or simply don’t know how it works. Moreover, some bookies can figure out your betting patterns, which may result in the restriction of your account. Although arbing is technically not illegal, it is frowned upon by sportsbooks because it costs them money. Therefore, don’t be surprised if your account gets frozen when you try arbitrage betting.

Another disadvantage of this betting strategy is that the profits are relatively small. Even when you bet $200 on two opposite bets, your maximum profit is usually going to be less than $10. That is another reason why a lot of bettors don’t choose arbing, as they believe it is simply not worth the time invested. It also takes away from the excitement of risk-taking that a lot of gamblers love.

Arbing opportunities can be few and far between, and in some cases, you might not even find any. Sometimes it’s going to be a lot of work to find arbs, as you will need to scout more than a few different sportsbooks before you are presented with an opportunity.

Therefore, arbing is not a strategy for everyone. It’s only for patient bettors and for those who are okay with making small profits over time.

arbitrage betting

Why Does Arbitrage Betting Exist?

Arbitrage betting exists simply because there are multiple sportsbook operators. Each operator employs its own odds compilers and analysts, and their pricing for a certain sports event can differ. Even when the odds for a match are similar, the small variations in pricing can create an arb that can be used for a guaranteed profit by a bettor.

The best-case scenario is that the odds vary a lot. For example, if one bookmaker sees one player/team as a sure-fire favorite, but another operator sees that same player/team as a clear underdog, making two opposite bets on the underdog will create an ideal arbitrage bet. However, this rarely happens, as all bookies work with the same information, so the odds tend to be similar.

Still, odds compilers do disagree at times, usually when two players/teams have roughly the same odds for winning. Check out our example bellow so you can learn how to recognize arbs and use them to your advantage.

Arbitrage opportunity example

In any case, it is not that important to you why arbs exist. What matters is that they do exist and that there’s often going to be an opportunity for you to beat the bookies at their own game and guarantee yourself a profit.

arbitrage betting

How to Identify Arbs?

Now we come to the most important part — identifying arbitrage betting opportunities and placing bets. 

First, you will have to check out the odds for a certain sports event by visiting as many bookmaker sites as possible. Write down the odds from every sportsbook and see what the best odds are for each of the outcomes.

Here is an example table with one of the previous tennis matches between Federer and Djokovic.

Federer Djokovic
Bookie 1 1.91 1.91
Bookie 2 2.10 1.74
Bookie 3 1.90 1.95
Bookie 4 2.05 1.80
Bookie 5 1.80 2.05

Here we can see that a couple of bookies saw Federer as the favorite, while others favored Djokovic. The best odds on Federer were 2.10, while the best price for a Djokovic win was 2.05. Once you come up with the most favorable odds, you can place two opposite bets, but only if there’s an arb. You will have to calculate that using a formula.

arbitrage betting

IAP and TAP

At first, you might find the calculations for arbing a bit confusing and complicated, but after going over them a few times, you will learn that they are relatively straightforward. To begin, you will need to calculate the IAP (Individual Arbitrage Percentage) using the following formula:

(1/odds) x 100

As we saw in our previous example, the best odds for Federer winning the match were 2.10, which would make the IAP for this outcome:

(1/2.10) x 100 = 47.62

The most favorable odds for a Djokovic win were 2.05, giving us the IAP of:

(1/2.05) x 100 = 48.78

Now that we know what individual IAPs are, we need to calculate the TAP (Total Arbitrage Percentage). We do this by adding the two IAP numbers together like this:

47.62 + 48.78 = 96.40

The TAP number suggests there’s an opportunity for an arbitrage bet since it is below 100. Any number above 100 means the bookie has the edge and arbing won’t work in that scenario.

arbitrage betting

The Size of Your Stake

The example we previously showed represents one of the most ideal situations in arbitrage sports betting. When the odds are so close together, you should make identical wagers for each of the outcomes. If you bet $100 on Djokovic, you will win $205. Betting another $100 on Federer will win you $210. So, either way, you are looking at a profit of either $5 or $10.

However, in some scenarios, making identical bets won’t work. Let’s say the best odds for one of the players are 1.65, and the most favorable odds for the other player are 2.80. If you make two separate bets of $100 and the player one wins (1.65), that will leave you at a loss of $35. In this case, you should use the following formula to ensure maximum efficiency:

(Total Stake x IAP) / TAP

Let’s say your total stake is $300. Betting on player one means you should wager ($300 x 60.6) / 96.3 = $189. For player two, you need to wager ($300 x 35.7) / 96.3 = $111.

Player 1 bet: $189 x 1.65 = $311

Player 2 bet: $111 x 2.80 = $310.8

In this situation, you are looking at a profit of $11 regardless of the outcome. Just remember to follow the formulas and everything will be in order.

arbitrage betting

Arbing and Matched Betting

Arbitrage betting and matched betting are similar since they both guarantee a profit by covering all outcomes of a certain sports event. However, in matched betting, bettors use free bet promotions from one sports betting site to make a back bet while making a lay bet on another site.

Both strategies can be effective. There are plenty of bookie sites that offer reload bonuses and free bets, so you can make matched betting work any day of the week. It is simpler to master and doesn’t require any formulas. Also, the profits are usually greater than with arbing.

Nevertheless, matched betting is more recognizable than arbitrage sports betting, and although it’s not illegal, it can often result in your betting account getting gubbed.

arbitrage betting

FAQ

Is arbitrage betting legal?

While arbitrage sports betting isn’t illegal, it is generally frowned upon by bookmakers. You won’t be breaking any laws by arbing, but if a sportsbook operator notices that you are using this strategy, they may try to freeze your account or ban you from their website.

How much money do I need to get started?

The minimum you should start with is $200. Of course, you can always wager less than that, but considering that the profits made from arbitrage bets are rather small, the more money you invest, the better. After all, there are no risks involved.

How much money can be made from arbing?

Although the profits for individual arbitrage bets are small, you can make a lot of money if you place several arbitrage bets per day. Again, this betting strategy is for patient bettors, so it will take some time before you see your pockets filling up.