What is Arbitrage Betting ? And Does it Make Money ?

Arbitrage

For the last month I have been testing Arbitrage Betting products. So in this post I will be looking at what Arbitrage Betting is. How it all works, its different types and of course the good and bad points involved with this money making system.

What is Arbitrage Betting ?

Arbitrage Betting is a technique that uses the differences in odds at two or more bookmakers to make guaranteed profit… It’s often called ‘sports arbitrage betting, sure bets, scalps or scalping, miracle-bets or even just arbs’.

If you back all possible outcomes of a sporting event at different bookmakers with the right conditions/odds it is possible to make risk free profit. but there are downsides

There are also a few different methods of achieving this betting situation which I will attempt to explain a bit further on..

But first here is a little about where you place these bets…….

The betting exchange

A betting exchange is a website where you can become the bookmaker! When you use one, you are effectively placing bets against other people. This means you are responsible for paying out the other person’s winnings when you lose…this is referred too as ‘liability’.

All winning bets on the betting exchange are also charged commission (normally at 5%)

Sound pretty crappy so far doesn’t it ….However there are advantages to it use.

When using the betting exchange it is possible to place lay bets … This is a bet on a team not to win ..In other words it covers two outcomes the draw and the loss…

And by acting as the bookmaker you do have the house’s advantage…

The Traditional Bookmaker

The traditional bookmaker is the phrase I will be using to describe a betting website where you have no liability … In other words the normal form of on-line betting

So with that out of the way ….here are the three common forms of Arbitrage….

Dutching

Dutching is the process of using two or three traditional bookmaker’s odds against each other.

Here is an example….

Dutching example

As you can see from the screen shot above ….Using a stake of £100 split between two different bookmakers makes you a minimum of 2.58 profit regardless of the event outcome……

Here is a example using three bookmakers.

Dutching Example

As you can see from above…..Splitting a stake of $100 between 3 bookmakers would produce a risk free profit of $7.03…. This again is regardless of the result as all outcomes are covered ….

So what are the pro’s and con’s of the Dutching method

Pro

Dutching does not require a large starting balance because you do not use a betting exchange….. you have no liability on losing bets…

You also do not have to pay betting exchange commission on your winnings

Cons

Profit percentages are lower than other forms of arbitrage.. (an average of 7% profit is normal)

Persistent arbitrage betting in this form can lead to bookmaker account limitations or bans. This is more commonly a problem with subscription services …(Arbs by email) as you are placing bets that many other people are too…  bookmakers can pick up on the high volume…

(I will explain how each system sets out to avoid this in the individual system reviews )

Lay/Back Betting

Lay and Back Arbitrage is where you use a betting exchange such as Bet Fair to place one half of your bet … Here is an example

lay example 1
As you can see from above it would be possible to make £14.92 from a £100 pound stake however .. you would need to have over £230 pound to cover the liability on the betting exchange..

So what are the pro’s and con’s of the Lay/Back method

Pro

It is possible to find higher profit percentage arbitrage bets with (an average of 14%)

Using a betting exchange means you can avoid any risk of account limitation or ban as you are the bookmaker …

Cons

You need to have more stake money to use this method .

Matched Betting

The last of the arbitrage methods I will explain is called Matched Betting. This like its name suggests, is the process of finding two opposing bets that cover all outcomes with similar or the same odds…

match betting example

As you can see from this example, This bet would result in a small loss .. and matched betting with your own money would in its self be pointless.

However when used in combination with a free or bookmaker’s bonus bet, because one half of the stake is not your money …. You can use this method to cash out that cash risk free.

As my regular readers will know this is the process used by my number one recommended product “Bonus Bagging matched betting

So now that I have explained the common forms of Arbitrage betting ….You can visit my reviews of 4 different arbitrage products below

100% Winners 2.0 Arbitrage Software

Ucantlose.com Email Subscription Arbitrage Bets

Bonus Bagging Arbitrage Software System

Bonus Bagging Matched Betting

Or you can visit my post “What is the best Arbitrage product ?” to see how they compare

Thanks for Reading

Paul Caskie