Sportsbet.io guide to arbitrage betting and how it works

Sports betting is fun when you can experiment with various kinds of strategies. Some of them are riskier but with higher returns, and others are the opposite. If you’re looking for a betting method designed to reduce risk and create consistent returns, then check out arbitrage betting.

Sportsbet.io will show you everything you need to know about arbitrage betting, like what it is, how it works, and its pros and cons. Read on to learn more and see if it’s the right betting method for your sports betting experience.

What is bookmaker arbitrage?

Arbitrage betting is sometimes known as ‘bookmaker hedging’ or ‘bookmaker both bets’, and is often described as ‘betting for profit without risk’. It sounds great on paper, and it’s a simple concept to follow. Essentially, all it takes is to bet on all possible outcomes in a market to cover all possibilities. 

When using the bookmaker hedging strategy, you are not invested in a specific side and are guaranteed to win regardless of the result. The most effective way to use the bookmaker arbitrage method is with odds shopping. Jump between different bookmakers to find the best bookmaker odds for each outcome, and place a bet where the odds are the highest. 

How does arbitrage betting work?  

Bookmaker hedging needs you to do a lot of math to guarantee a net profit. The payout you’re getting has to cover all potential losses on your other bets. Bookmaker arbitrage will have you deciding how much to spend on one bet compared to the others, so the risk doesn’t outweigh your returns. 

Below is an example of the bookmaker arbitrage method in practice:

Simulation for Japanese yen (JPY): You bet on a match between Team A vs. Team B using ¥10,000 across two different bookmakers:

In this situation, you are betting a total of ¥10,000 to bet on one football match. You decided to split it between two outcomes of a 1x2 winner bet. The best deals you found are from Bookmaker 1, offering 2.1 decimal odds if Team A wins, and Bookmaker 2 offers 2.05 odds if Team B wins. Both are close to even-money bets, so it’s easy to guarantee profit. 

To get the optimal return from betting on both outcomes, calculate the best way to distribute your funds following these steps:

1. 1 divided by the odds, do it once for each. 
2. Add the two quotients together.
3. Divide each quotient by the sum of both to get the proportions. 
4. Multiply the quotient by your total funds.

Use it on both bets to have the following: 

• Team A wins bet: 1 ÷ 2.1 = 0.4762
• Team B wins bet: 1 ÷ 2.05 = 0.4878
• 0.4762 + 0.4878 = 0.964

Calculate for bet proportions:

• Team A wins bet: (0.4762 ÷ 0.964) x ¥10,000 = ¥4,940
• Team B wins bet: (0.4878 ÷ 0.964) x ¥10,000 = ¥5,060

Now, calculate the guaranteed returns. You can place the bet and use Sportsbet.io’s bet slip to tell you the payout. If you wish to calculate it yourself, then here’s how it’s done using the decimal odds format:

Multiply the size of your stake by the odds of the respective bet.

• Your bet x the odds = your payout
• Team A wins bet: ¥4,940 x 2.1 = ¥10,374
• Team B wins bet: ¥5,060 x 2.05 = ¥10,373

Your lowest guaranteed winning is at least ¥10,373. That means even if you won with the least rewarding prediction, the arbitrage method guarantees your ¥10,000 total is paid back plus ¥373 profit. That’s a 3.73% profit margin that you can enjoy. 

The process of using the arbitrage method is simple, but it can be tedious if you’re betting on multiple markets. You can use free online arbitrage calculators to help. Just learn the fundamentals of how it works so you’ll properly identify the correct given.

The above example shows how to use bookmaker arbitrage using fiat. Here’s another simulation of a bookmaker both bets, but using crypto like the Tether (USDT). 

Simulation for cryptocurrency (USDT): You bet on Team A vs. Team B using 100 USDT, also across two different platforms

It can be football or baseball, but the scenario is the same: only one team can win the game. This example is a bit different from the first one because the odds for Team A to win are 1.95. In decimal format, that’s lower than an even-money bet, so it’s even more important to calculate your bet amounts carefully. Just follow the step-by-step process below: 

• Team A wins bet: 1 ÷ 1.95 = 0.5128
• Team B wins bet: 1 ÷ 2.1 = 0.4762
• 0.5128 + 0.4762 = 0.989

Calculate for bet proportions:

• Team A wins bet: (0.5128 ÷ 0.989) x 100 USDT = 51.86 USDT
• Team B wins bet: (0.4762 ÷ 0.989) x 100 USDT = 48.14 USDT

Solve for potential returns:

• Team A wins bet: 51.86 × 1.95 = 101.13 USDT
• Team B wins bet: 48.14 × 2.10 = 101.11 USDT

Following the above solutions and allocating your funds for both bets accordingly, you have a guaranteed return of 101.11 USDT on a 100 USDT bet. That's a 1.11% profit margin, or 1.11 USDT net profit. 

That is the in and out of arbitrage betting using fiat and crypto. This applies to all supported payment methods with no change to the formula. However, the examples provided are for decimal odds, specifically. Results may vary when using other formats. 

Both simulations above are about betting on matches between two teams, so there are only two possible outcomes in a fixture. This time, see what arbitrage betting looks like in a horse race:

Simulation for 100 USDT: You bet on a horse race with 6 contestants using 100 USDT, also across different platforms. 

The race consists of six horse racers competing in one match. Bookmakers usually frown upon betting on all possible winners, but you’re only choosing three per account. Thus, you don’t need to make more accounts on different platforms that would just make fund management more difficult.

• Horse 1 wins: 1 ÷ 5.00 = 0.2
• Horse 2 wins: 1 ÷ 6.00 = 0.167
• Horse 3 wins: 1 ÷ 4.50 = 0.222
• Horse 4 wins: 1 ÷ 8.00 = 0.125
• Horse 5 wins: 1 ÷ 10.00 = 0.1
• Horse 6 wins: 1 ÷ 7.50 = 0.133
• 0.2 + 0.167 + 0.222 + 0.125 + 0.1 + 0.133 = 0.947

Calculate for bet proportions:

• Horse 1 wins: (0.200 ÷ 0.947) x 100 USDT = 21.11 USDT
• Horse 2 wins: (0.167 ÷ 0.947) x 100 USDT = 17.60 USDT
• Horse 3 wins: (0.222 ÷ 0.947) x 100 USDT = 23.46 USDT
• Horse 4 wins: (0.125 ÷ 0.947) x 100 USDT = 13.20 USDT
• Horse 5 wins: (0.100 ÷ 0.947) x 100 USDT = 10.56 USDT
• Horse 6 wins: (0.133 ÷ 0.947) x 100 USDT = 14.08 USDT

Solve for potential returns:

• Horse 1 wins: 21.11 USDT x 5.00 = 105.57 USDT
• Horse 2 wins: 17.60 USDT x 6.00 = 105.57 USDT 
• Horse 3 wins: 23.46 USDT x 4.50 = 105.57 USDT 
• Horse 4 wins: 13.20 USDT x 8.00 = 105.57 USDT 
• Horse 5 wins: 10.56 USDT x 10.00 = 105.57 USDT 
• Horse 6 wins: 14.08 USDT x 7.50 = 105.57 USDT

The arbitrage betting method ensures that your 100 USDT bet on all horse racers in a race with six participants will yield 5.568 USDT or 5.568% profit margin. It’s a longer list of possibilities than a football match, but the principles of the strategy remain the same. 

Is bookmaker arbitrage prohibited in sports betting?

Some platforms may tolerate bookmaker arbitrage, but it's rarely mentioned clearly in their terms and conditions. In most cases, arbitrage betting is not allowed, and operators reserve the right to cancel your wagers or suspend your account if they detect this strategy.

Alternatively, you could simply rely on using multiple accounts across different platforms. Arbitrage betting is best done on different sites, so your bets are rarely placed on the same bookmaker. 

Merits and risks of the arbitrage method  

You now know what arbitrage betting is and how it works. It is now time to explore its merits and risks so you can decide if it’s the right strategy for you. 

Advantages

The advantages of arbitrage betting can be summarised in two key points: reliable profits and minimal skill requirement. Here’s what they mean and why they’re great merits to you in sports betting:

Profits are reliable

Arbitrage betting can deliver consistent profits if executed correctly. While the strategy is designed to cover all outcomes, your profit depends on placing all bets quickly and accurately before odds shift. 

There are minimal skills involved

You still need to operate multiple accounts at a time, and learn the arbitrage betting fundamentals so you’ll know how to use the free online calculators. When all of these are ready, arbitrage betting can be a trivial matter that you can do for hours with minimal risks of failure. 

Works across many sports and markets

There is no limit to the sport or market where you can use the arbitrage betting method. It’s easiest to use in two-outcome bets (like tennis), but can also be used in 1x2 bets by covering all three results. You can also use this on races or league outrights where you have plenty of options for potential winners. 

Independent of match knowledge

The best part about arbitrage betting is that you don’t need to be familiar with the sport. It’s a low-risk method because it doesn’t rely on predicting outcomes. Although it's not completely risk-free, errors, odds movement, or account issues can still affect your results. 

On the other hand, player skills and team forms are the most influential factors in sports betting. They are exclusive knowledge to fans, but arbitrage betting forgoes those details. 

Disadvantages

The arbitrage betting method is not perfect. Each of the aforementioned advantages has a corresponding disadvantage. Here they are, and why you might consider not using arbitrage betting in bookmakers:

Low risk also means low reward

Your payout on the winning bet needs to exceed the total amount staked across all outcomes, which is why the margin stays small. Every time you make an arbitrage bet, you’re spreading funds across every possible outcome. 

You need a high capital to start with

Technically speaking, you can just place a minimum bet on every possible outcome. Sportsbet.io supports wagers as low as 0.07 USDT, and you can spend that much on multiple predictions. However, the returns are usually too small to matter unless you start with a large budget.

Time-intensive and requires fast action

Online bookmakers like Sportsbet.io have dynamic odds that change every 15 seconds to 2 minutes during in-play betting. That means you have to be quick at deciding how to allocate your funds before it changes. Otherwise, you’ll have to calculate again. Use a free online arbitrage calculator to be quick or bet on future fixtures over in-play. 

Currency exchange and transaction cost

Net profits in arbitrage betting are small because your winnings must offset losses from other outcomes. These limited gains can shrink even further due to withdrawal or transaction fees. Sportsbet.io does not charge for deposits or withdrawals, but wallets, credit/debit cards, and bank providers do.

Start arbitrage betting on Sportsbet.io with newfound knowledge

Put your knowledge into action at Sportsbet.io, a leading crypto betting platform. Enjoy instant deposits and withdrawals using supported cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Tether (USDT). Prefer traditional currency? Sportsbet.io also accepts fiat options such as Japanese yen (JPY), Chinese yuan (CNY), and Canadian dollars (CAD).

You can bet in-play on live events or place early wagers on future fixtures. Outright and league betting options are available alongside a wide range of sports and esports markets, giving you more opportunities to find value. Follow both domestic and international competitions, and enhance your betting experience with exciting prop bets.

Bet smart with zero risk, use bookmaker arbitrage 

Arbitrage betting is a low-risk strategy that you can use on any sports or esports tournament. You can also try it on virtual sports at Sportsbet.io, where you have fresh markets every few minutes, 24/7. 

Betting on Sportsbet.io also gives you access to regular promotions and bonuses, offering cashback, risk-free bets, or giveaways to help boost your bankroll. These perks can help offset the high capital requirements often needed for successful arbitrage betting. Whether you’re on desktop or mobile, Sportsbet.io’s responsive web platform and dedicated mobile app make it easy to bet anytime, anywhere.

Frequently Asked Questions (FAQs)  

Here are some of the frequently asked questions about arbitrage betting:

Is hedge betting legal?

Hedge betting is legal, as it involves placing strategic bets at favourable times. However, some bookmakers may restrict or prohibit it if their terms and conditions permit them to do so, even if the practice itself isn't against the law.

What is bookmaker arbitrage?

Bookmaker arbitrage is about spreading your bet across every outcome to minimise or eliminate the risks. It also involves odds shopping and funds allocation to guarantee profit. 

Is arbitrage betting legal?

Arbitrage betting is legal, but a bookmaker may frown upon its use. Most bookmaker terms and conditions allow operators to stop arbitrage betting at their discretion. 

Is hedging a great idea?

Yes. Hedging or hedge betting is about finding the optimal time to bet against your original prediction. 

How can I verify whether arbitrage is allowed by a bookmaker?

Arbitrage betting is not often mentioned in the terms and conditions. The best way to verify if the bookmaker allows it is to contact customer support and inquire about their policies.