Smart punters are constantly in search of profitable betting scenarios and systems are designed to introduce logic and structure into the process. Generally, betting systems are varying in terms of risk involved and the size of winnings. Other than sensible bankroll management, integrating a working betting system can amplify profits to a noteworthy extent. Arbitrage betting is among the most popular systems applied to football. Many sports enthusiasts have probably heard of it but some of them may have no clear grasp of the notion.
An arbitrage opportunity typically arises in any market where an item is being offered by different operators and, consequently, its price across them varies. With so many bookies accepting bets on a diverse range of football events, naturally, there are variations in the odds offered for the same betting market of a particular match.
We will clarify the fundamental principles of football arbitrage betting, as well as the necessary calculations to implement the system and some of the risks associated with it.
Football Arbitrage Betting Explained
Arbitrage betting, also referred to as arbing, is a system whose central principle requires punters to bet on opposing outcomes of a football match at different betting operators, to guarantee a profit, irrespective of the final result. The probability of an outcome occurring in football matches is calculated differently across bookmakers, and hence differences in the odds come about.
The reasons for the different calculations across bookmakers are various. First of all, when setting the odds of football markets to reflect their probabilities, operators take into consideration different factors and thus come up with different results. Oftentimes, arbitrage opportunities occur when bookies make mistakes. Price differences may also be due to the speed at which bookies react to sports news. Some of them adjust the odds almost instantaneously, while others are not so quick in that respect.
Yet another very important reason for the discrepancies in prices across different bookmakers is due to their profit margin, which also varies. Sportsbooks always have a profit margin built into the odds they offer, otherwise, they would not be able to generate profits from every single bet that punters make. Therefore, an arbitrage betting opportunity cannot arise when punters are placing bets with a single bookmaker. To properly apply this betting system, they need to have accounts with at least two different operators.
Although an arbitrage betting opportunity can be found by manually researching the odds of different operators and by using odds-comparison websites, punters can also make use of special software designed for this purpose.
How to Calculate Football Arbitrage Bets
- To explain the way arbitrage bets are calculated we may take as an example a match from the Italian Serie A, Verona vs Genoa. Let’s assume that bettors have managed to track down an arbitrage betting opportunity by comparing the odds offered by two online bookmakers for the same football betting market.
Online Bookmakers Odds for Verona Odds for Genoa Bookmaker 1 1.96 4.16 Bookmaker 2 1.86 4.30
The first bookie offers odds of 1.96 for Verona, and 4.16 for Genoa, while the second bookie’s prices are respectively 1.86 for Verona, and 4.30 for Genoa. Once bettors have spotted a potential opportunity, they need to figure out whether the odds represent a Surebet. This can be done either with an arbitrage calculator or by making the needed calculations manually.
- Punters need to place a bet for each of the opposing outcomes with two different bookies. The better price for Verona is offered by Bookmaker 1 (1.96) and the better price for Genoa is supplied by Bookmaker 2 (4.30). The next step along the way is to calculate the implied probability which the odds represent via the following formula:Arbitrage % = (1 / decimal odds) x 100)Implied Probability is the process of converting the betting odds into probabilities, expressed in percentages. Thus, we make the necessary computations for our example:
Online Bookmakers Best odds from both bookmakers Implied Probability Bookmaker 1 – Odds for Verona 1.96 Arbitrage % of odds for Verona = (1 / 1.96) * 100 = 51.02% Bookmaker 2 – Odds for Genoa 4.30 Arbitrage % of odds for Genoa = (1 / 4.30) * 100 = 23.26%
- Having calculated the individual implied probability which the odds for the two outcomes suggest, we may sum them up to receive the Total Arbitrage Percentage.Total Arbitrage % = 51.02% + 23.26% = 74.28%Since the total arbitrage percentage from our example above stands at 74.27% and represents a figure less than 100%, we may conclude that we have found a chance to place a Surebet.
- Yet another important calculation to be made is the one regarding the value of individual stakes, or how punters are supposed to distribute their total investment between the two bookmakers. This is necessary so that they generate the same profit regardless of the winner of the match between Verona and Genoa. The value of both stakes should be proportional to the odds. The formula for calculation of the proportional distribution of the total stake between both outcomes is the following:Value of Individual bets = (Total Investment x Individual Arbitrage %) / Total Arbitrage %In the table below, bettors may have a look at the way individual stakes for both outcomes are calculated, assuming that a punter has decided to stake a total of €600:
Online Bookmakers Best odds from both bookmakers Individual Stake Bookmaker 1 – Odds for Verona 1.96 (€600 x 51.02%) / 74.28%= €412.14 Bookmaker 2 – Odds for Genoa 4.30 (€600 x 23.26%) / 74.28%= €187.86
We see that the combined value of our individual stakes (€412.14 plus €187.86) equals the total amount of the investment we are willing to make, i.e. €600.
- To estimate the total net profit for both outcomes, punters need the following formula:Profit if Verona wins = (Stake for Verona x odds for Verona) – (total stake)
Profit if Genoa wins = (Stake for Genoa x odds for Genoa) – (total stake)
Online Bookmakers Net Profit Bookmaker 1 – Odds for Verona (412.14*1.96) – (600) = €207.80 Bookmaker 2 – Odds for Genoa (187.86*4.30) – (600) = €207.80
As we see, thanks to the proportional distribution of the stakes between the two bookmakers, in accordance with the value of the offered odds, the net profit that punters stand to win from both outcomes of the football match is the same.
To sum up, the process of identifying, calculating, and placing arbitrage betting opportunities involves the following steps:
- Spotting arbitrage betting opportunities manually, through odds comparison websites, or via specialized software. The latter saves a lot of time and effort as it removes the manual work of the process.
- Calculating the implied probability of odds
- Calculating the total arbitrage percentage
- Calculating the distribution of the stake between the two operators
- Calculating the net profit from both outcomes
Betting Exchanges and Betting Shops Used for Arbitrage Betting
Thus far, we have outlined the main characteristics of finding arbitrage bets by examining odds comparison websites and different bookmakers to identify the best available opportunities.
However, this is not the sole approach bettors may rely on. They may use a bookmaker and a betting exchange instead. For this purpose, they need to place a back bet with a bookmaker and lay a bet at a betting exchange. Unlike sportsbooks, betting exchanges are not frowning upon arbers.
Yet another possible practice for creating an arbitrage opportunity is using an online bookie for one of the outcomes and a betting shop for the other. Betting shops are generally slower in terms of odds changes, which bettors may use in their favor.
The Risks of Football Arbitrage Betting
Some refer to arbitrage betting as a risk-free system or as Surebets, however, punters need to know that there are some risks involved and they should not be underestimated.
Limiting or suspension of betting accounts
Although arbitrage betting is not prohibited by law, betting operators generally hold an unfavorable view of it. The practice can be easily detected and when they do, bookies are quick to limit or suspend bettors’ accounts.Another important aspect to take into consideration when dealing with two different operators is the maximum allowable limit for single stakes. Bettors are advised to check them in advance to avoid subsequent exposure to losses.
Bookies make mistakes
As we have already mentioned arbitrage betting opportunities might be due to errors on the bookies’ side. They tend to void such bets and refund bettors’ stakes. If the odds are too good to be true, they most certainly are due to an error.
Punters make mistakes
Other than the betting operators’ disapproval of the practice and the possible mistakes they make once in a while, there are other variables that need to be taken into consideration. Since it is a system requiring some mathematical calculations to be done, bettors are very often prone to mistakes, and incorrect calculations can lead to potential losses.
Losses due to changes in the odds can be another common reason for unsuccessful arbitrage bets. While bettors may have quickly identified an arbitrage betting opportunity, it may disappear quite unexpectedly. To implement this betting system, punters need to identify markets quickly and act swiftly, while the option still exists.
Arbitrage bets may pose difficulties in identifying
Arbitrage betting opportunities may be difficult to locate. Since they occur more rarely, this may prevent bettors from making consistent profits from them.
Arbitrage betting is usually described as a betting system that is linked with guaranteed but limited profits. Although the system has existed ever since sports betting’s inception, the fast-paced development of computer technologies, and the emergence of odds-comparison websites and betting exchanges have contributed a great deal to its popularity. Arbitrage betting is a dynamic process and to successfully implement it, bettors need time and practice, as well as diligence, and discipline.