The arbitrage strategy basically trys to get a risk-free position by exploiting differences in odds across markets. The practice of arbitrage is usally called arbing and the bettors that do it are called arbers.
Typically, arbitrage opportunities arise between differences in odds offered at Betfair and other bookmakers. The idea is to create a risk-free position by backing at high odds while laying at lower odds elsewhere. So for example, if a local bookie was offering the Manchester United at 3.0 but it was being offered at 2.0 at Betfair, then there is an opportunity to arb between markets. You would do this by backing MU with your local bookie at 3.0 and then also laying MU at 2.0 on Betfair. This creates a guaranteed profit whether MU wins or loses. To illustrate further:-
|
Bet Bookie: $100
Backed at 3.0 |
Bet Betfair: $150
Layed at 2.0 |
Net Profit |
MU win |
Win $200 |
Lose $150 |
$50 |
MU lose |
Lose $100 |
Win $150 |
$50 |
The above table illustrates that we have created a guaranteed $50 profit no matter what happens. This is essentially what arbitrage is all about.
It is hard work being an arber. The bookies are more switched on and there is ever more competition. But for the savvy and quick, there are still plenty of opportunities.
Good Luck!
* Just in case - we're using decimal odds here. So when we lay MU AT 2.0 it is an even money bet, which is why we lose $150 on an MU win. Likewise, when we back MU at 3 it is 2/1 bet so we win $200 on an MU win.
|
