It’s a popular question we often see from our sports betting community as they advance their sports betting strategy. What is arbitrage betting, and how do you employ an arbitrage betting strategy? An arbitrage betting strategy is a betting system for exploiting differentials in odds for a specific sports market at two or more bookies or online bookmakers. Arbitrage betting guarantees the sports bettor a profit, as the combined odds produce a negative margin - a margin in the bettor’s favour.
A sports book account, such as at popular online sports books as Pinnacle Sports, is essential for any punter wanting to try an arbitrage betting strategy, due to the sports books reputation for providing the high-value odds with low margins and high betting limits.
Arbitrage scenarios commonly occur because bookies differ in opinion on a particular sports market. This increasingly happens with more obscure events, where the variation in margins offered across a range of bookmakers is greater.
Certain online sports books, such as Pinnacle Sports are popular among punters as they can often find the most competitive odds; such as margins as low as 1.5% for football and baseball and apply a low margin policy to all markets posted.
The following video covers a good basic understanding of arbitrage betting.
Example of an arbitrage bet
To explain Arbitrage betting we will use a simple example. Take the odds on a tennis match between Player A and Player B offered by two hypothetical bookmakers as illustrated in the table below.
Arbitrage betting example
The market percentage is indicated for each bookmaker i.e. the edge in their favour. By cross-matching the odds from Outcome 1 at Bookmaker A with Outcome 2 at Bookmaker B, the market percentage turns in the bettors favour providing a guaranteed return of 4.3% (100/95.9 = 4.3).
This principal can apply to any betting market, beyond just two selections, including spread betting, while it has wide application in live betting where Arbitrage opportunities are constantly available by Backing and Laying in a constantly shifting market. You can also are free bonuses to lock in a guaranteed profit, but the conditions that apply are restrictive.
For new bettors starting off, you can simulate your arbitrage betting and test your sports prediction performance by simulating in a free-play sports betting community as SocialSportsBettingPicks.com.
Potential downfalls of arbitrage betting
As with any type of betting there are pitfalls, and arbitrage betting is no different.
Stake limitation & account closure
Limits vary at different bookmakers, which may hinder your ability to properly exploit an art, so it is important to know that what bookie or sports book offers the highest limits online.
But be area, some bookmakers have been known to close betting accounts of players who consistently win. So when you open a sports betting account, do your homework to find a reputable sports books rated by the sports betting community.
Bookies and bookmakers can eliminate bets where mistakes have been made, which sadly would leave the punter exposed on the other side(s). This can easily wipe out profits accrued over a long period, so be aware.
To fully exploit arbs, the player must have a large number of funded bookmaker accounts, as well as the time to take full advantage. This involves significant organization, coordination and effort. Many practice arbitrage betting for a living (aping financial arbitrage) in which time invested must also be measured as a cost.
Bookmakers are constantly changing their odds and assessing risk, with arbitrage betting opportunities lasting seconds rather than minutes. This makes speed to place an arbitrage wager absolutely critical, and in time crunch times, errors inevitably occur that could be costly. Arb software systems can help in this regard, but their cost will eat into your profit margin.