|
|
How
does arbitrage betting work?
Fact is, there are thousands of bookmakers, some better
than others, on the internet.
Their prices are set by the punters who choose to put
more money on one result than another.
The idea of arbitrage is that where two bookies have
different opinions as to the outcome of an event
you bet one result with one bookie and the other result
with another so that whatever happens you make a profit.
The simplest example is something like a tennis match,
where there are only two possible outcomes
- either player A wins, or player B wins.
An actual example: Bookie X prices player A at 7/4 while
bookie Y prices player B at 6/5.
You bet £36.37 on Player A and £45.45 on player B.
Your outlay is £81.82 and whoever wins your return is £100
- A PROFIT OF £18.18!
The same principle holds where there are more than two
outcomes - say a football match can be 1 2 or X.
In that event you may need to bet with three bookies on
the three outcomes.How
do you work out how much to put on each bet?
You convert the price into a percentage.
You multiply the 2nd number by 100 and divide the answer
by the sum of the two numbers.
So, with the price of 7/4 multiply the 4 by 100 = 400 and
divide that by 7+4 (11) and you get 36.37.
Similarly with the price of 6/5 multiply the 5 by 100 to
get 500 and divide that by 6+5 (11) to get 45.45.
Those numbers represent the percentage chances so staking
those amounts will return £100 to a winner.
Think it can't happen?
In 1996 American bookies made Tiger Woods 1/5 favourite (83.33%)
in the US Masters.
In the UK where noone had heard of him, Ladbrokes had him
at 4/5 (55.55%).
Tiger was playing Gordon Sherry, 11/4 (26.66%) in the USA.
Both countries had the tie at 16/1 (5.88%).
So, bet £55.55 on Tiger Woods here, £26.66 on Sherry in
the USA, and £5.88 anywhere on the tie.
A total of £88.09 staked and £100 returned in any event
(Tiger won).
In practice, you can round the numbers up to £56, £27,
and £6 for ease.
The important thing is that the percentages must add up
to less than 100 to give an arb.
What
about decimal odds?
7/4 in decimal odds is 2.75 (i.e. you get back 2.75 times
your stake).
To turn it into a percentage just divide it into 100.
100 divided by 2.75 = 36.36. Easier once you get used to
them.
How
do I find arbs?
Well, you can do it the hard way by visiting lots of
bookies and noting their prices for various events
or, you can let the internet do it for you.
There are lots of sites that can give you this
information but remember, they don't check every bookie
- some only check the more mainstream ones, others check
the more obscure (but to my mind riskier) ones.
To see my recommendations for arb finders,
click here.
To see my recommendations for bookies,
click here.
|