Arbitrage betting is a betting strategy where you cover all the possible outcomes of one single market in one single event, for example backing both tennis players to win in the same two-way market. The majority of the time just doing this will not produce a return, but by identifying the margins where bookmakers have very different odds, there are scenarios created where you can place a stake on each market that returns the same amount and guarantees overall profit from betting. These margins are usually very slim and only of use to bettors with a lot of funds to exploit them. Furthermore, whilst arbitrage betting can be a good betting strategy, it is frowned upon at every worldwide bookmaker bar Pinnacle. Whether or not in states it in a bookmakers betting terms and conditions, arbitrage betting will result in the removal of your account.
Pros & Cons
- Pro - If identified and staked correctly, you are 100% guaranteed profit from betting every single time.
- Pro - With margins being below 100%, not only are you not suffering from the bookmakers built in marginal advantage, you’re actually gaining your own advantage.
- Con - If you are found out at all bookmakers bar one, you will have your account removed permanently and you may make your way on to other bookies’ radars.
- Con - You most likely need a very sizeable amount of money to be able to make worthwhile profits from sports betting whilst using this betting strategy.
Here is a total step-by-step guide to show you how to understand, identify and place an arbitrage bet. So to recap the above, we know now that an arbitrage bet is a bet where you place two separate bets at varied stakes on different outcomes for the same event. You are betting on directly opposing outcomes with the guarantee that you will make profit. For this reason, this is why arbitrage betting is focused around two way betting markets such as a tennis match, which eliminates the possibility of a risk and a draw.
Now because there are only two betting markets, bookmakers are going to do their best to make sure they never make it possible that you can bet on both outcomes with them and be guaranteed profit. But that doesn’t mean that you can’t bet one outcome with one bookmaker, and the opposing outcome with another. Betting odds are on the whole pretty comparable, but betting is a game of opinion. Whilst a lot of traders may look to other bookmakers who have already published their odds as a guide to inform, differences of opinion can happen. Lines can move at one bookmaker before they do another, meaning the betting odds present an opportunity.
Implied probability and margins
Firstly, it’s important to understand implied probability. The betting odds in any two or three way market will never equal less than 100%. Most often the implied probability of all outcomes will be at least 103%, which is how we get to know the bookmakers have these margins. Look at the below example.
Team A are 3.50, the draw is 3.25 and team B are 2.10
By converting to implied probability, their supposed chances are:
Team A: 28.6% Draw: 30.8% Team B: 47.6%
In this example you can see that all three outcomes combine to 107% probability. If you were to stake a £10 bet on all three, then you lose £20 somewhere and at best make £25. However, that’s a one in three shot with 28.6% probability. Most probably, you win at Betting odds of 2.10 which would leave you £9 down.
You could attempt to stake to achieve an equal return regardless of which bet wins, but you wouldn't profit. As you can see from the margin you would be down by 7%. So there’s no sense doing that and it’s impossible to get an edge over a two or three way market event with the same bookmaker.
Now it’s been discovered that all bookmakers will ensure their margins at worst are 100%, there’s no hope of profiting by covering all Betting markets at the same bookmaker. There’s backing and laying, and also betting the outcomes anyway and hoping the highest priced one wins, but that isn’t a guarantee like arbitrage betting.
Betting odds comparison sites are very useful because they provide you with a different angle. Rather than focus on odds from one bookmaker, they’ll bring you the highest odds out there. This could likely be from three separate bookmakers. They’ll also tell you what these add up to in terms of margin.
There’s little crossover or cohesion between the many separate bookmakers out there, but bookmakers are aware of leaving themselves open to arbitrage betting and will try to avoid it. But it’s still inevitable. Any time a margin is below 100% like in the below examples, staking on all the possible outcomes at the different bookmakers specified will 100% guarantee a profit! Some odds comparison sites now even have a section that will highlight to you betting markets where you can cover all the outcomes and be guaranteed a profit. Here's an example from popular website Oddsportal.com:
Whilst it does probably go without saying, don’t make the mistake of thinking you can bet any amount and profit just because this is a ‘guaranteed win’. Stakes are carefully calculated to ensure that each of the outcomes gives you an equal return. The profit comes by needing to stake less than any outcome will return.
How to stake on an arbitrage bet
Using one of the above arbs as an example, the Minnesota Vikings are set to met the New Orleans Saints in NFL. The best odds for the Vikings are 21/25 with 888Sport, whereas the best odds for the New Orleans Saints are 29/20 with American bookmaker 5Dimes. Staking £10 on each would either return £18.40 or £24.50, so that isn’t how to make money from sports betting.
Bookmakers like Pinnacle actually welcome arbitrage betting (which is rare and something that will be covered shortly) and even provide you with a convenient little calculator to work out how much you need to bet. How much you want to bet overall is up to you, and the first stake you enter into one of these calculators informs the second.
Above you can see what entering a stake of 25.00 does for you. The calculator tells you that if you want to bet 25.00 on one selection, then you’ll need to bet 18.78 on another selection. But you can enter literally any amount you want. Even amounts that aren’t whole or round like in the below example.
Did you know arbitrage betting is highly frowned upon?
Beware that arbitrage betting is not something that bookmakers will take kindly to. Bookmakers will limit people if they profit from sports betting, so you can imagine that your account is a goner if you’re found to be betting in a way that guarantees you make money from sports betting.
Pinnacle Sports are the only known bookmaker that actively accept and promote arbitrage betting. They’re a serious bookmaker, and they can withstand losing big bets. High rollers use Pinnacle and they’re never making a shortage of cash, so they have the wherewithal to understand that while they may lose bits here and there, some big wins will also come their way.
On paper, if you’re taking money from one bookmaker you won’t be upsetting the other, and you’re always going to win one bet and lose one bet. You’re never directly taking advantage of one bookie overall so you’d think they’d let it fly, but they really won’t.
How to avoid being detected when arbitrage betting
It’s pretty easy to pop up on a bookmakers radar when you win all the time or happen to bet very specific amounts regularly. You’re going to be a red flag on the system and you’ll be ousted. BUT, there isn’t some sad soul who is employed solely to catch arbitrage bettors. It is just a system or a computer after all, and in looking for specific behaviour and patterns, it’s not that hard to throw it off the scent at times.
Here are a few things you can do to to avoid detection:
- Make sure you are placing plenty of normal bets on each bookmaker you arb with
- Make yourself seem less profitable. If you’re winning big on arbs, lose your other bets
- Give justification to the weird stakes. Go bet some random stakes on ridiculous accas
- Litter your account with rubbish. If at first glance your account appears to be nothing more than pages of stupid accumulator bets with stakes that are nonsense, you might avoid further inspection.
- Be careful how you deposit. Don’t uploads hundreds or thousands and then pile uneven amounts onto a bet. Upload very slowly and over time in preparation. Meanwhile, keep active.
- Always withdraw in small amounts and over time, whilst again keeping up what looks like regularly betting activity. If you can make yourself look like a mug (without actually losing your profit from betting in the meantime) then do so.
- Don’t bet on bookmaker errors. Rarely, once in a blue moon and for split seconds, a bookmaker may enter the wrong odds on selections. If you happen to be in the right place at the right time, just ignore them.
You can place arbitrage betting as a casual punter just as easily as a professional bettor, but the issue is you can expect pennies in return. Unless you have substantial funds available then arbitrage betting is not a real stream of income, as stakes in the hundreds could return no more than tens of pounds. A wealthy person, not always even someone with a keen interest in sports betting usually, is the most likely to utilise this form of betting with two way tennis betting markets being a perfect example of commonly arbed betting markets. It’s not really possible to place football bets or horse racing bets when using arbitrage betting, although the draw/no bet market on rare occasions may produce a potential arb bet.
Whilst it is a guaranteed way to make money, you’d need a very large betting bank to do so. It’s not worth the risk it poses to your ability to open accounts and place sports bets with bookmakers. British members do not currently have access to any bookmakers that approve of or accept arb bets, although that may change in the future if Pinnacle is re-introduced. But for the time being, arbitrage betting has to be considered a bad betting strategy due to the risk it poses to your ability to participate in sports betting.
Bookmakers communicate and if you’re caught arbing then you can be sure you’re going to struggle to place bets across the board. If you’re a person with endlessly deep pockets, then arbitrage could be an investment for you, especially with tools like those on offer at Bet On Value. It’s wise not to engage in this activity unless you do have access to Pinnacle.