Imagine a world where you could make any number of bets and always be guaranteed of winning. Not just winning at the end of the day, but each and every bet you place. You literally sit back and watch your bank account grow by the day without putting a single cent of your own money at risk.

Sounds to good to be true right?

Well it is and it isn’t, welcome to the world of arbitrage betting.

I will say up front that arbitrage betting is something that definitely exists, its not a mythical creature hidden deep in the forest with Big Foot. But it can be as rare and dangerous as Big Foot and the Yeti combined.

What is arbitrage betting?

Put simply, arbitrage betting involves taking advantage of different odds posted by different bookmakers in a market. Occasions can exist where bookmakers with different opinions of a match can post odds which are different enough that a punter can bet with both and ensure a profit regardless of the result (in the same way a trader takes advantage of price changes).

Lets look at an example:

Arbitrage betting example

x Home Team Away Team Market %
Bookmaker A 1.3 3.93 102.4
Bookmaker B 1.42 2.9 104.9
Best odds 1.42 3.93 95.9

As we can see both Bookmaker A and Bookmaker B have posted markets for the upcoming match. Not only does each book have a different market percentage, but they also have a different opinion on the match or have received different amounts of money on each team and have changed the odds to balance their book.

By looking at all the available odds on the match as a market rather than just a single bookmaker offering is can be possible to have a combined market percentage of less than 100%. In this scenario as seen in our example, by betting on the home team with Bookmaker B and the away team with Bookmaker A we are guaranteed of profit of 4.1% regardless of the result.

Of course the more bookmakers you can compare odds against the better chance there is of finding arbitrage betting opportunities. Betting exchanges such as Betfair can also often provide arbitrage opportunities within an individual market and on a single outcome through the ability to back and lay.

So this all sounds great right? Open a few bookmaking accounts and free money!

Well not quite.

Finding arbitrage betting opportunities

The first hurdle when it comes to arbitrage betting is simply finding where the opportunities are.

While betting exchanges make it relatively easy to identify opportunities in markets in which you have already bet (Betfair for example have a one click “cash out” option), comparing a range of different bookmakers in markets you wish to bet can be very time consuming.

Sites such as Odds Portal provide free widgets to members which allow the comparison of different bookmakers at a glance, however still require looking a literally thousands of different markets.

Professional solutions also exist which automatically search for and identify arbitrage opportunities using live feeds from bookmakers. These solutions however are not cheap, ranging anywhere from $150 a month.

But if you do invest time and/or money it is possible to identify arbitrage opportunities, that is however not the final hurdle to your free money.

Problems with arbitrage betting

Timing

Arbitrage betting opportunities tend to only be available for a very (eg seconds to 5 minutes), short period of time.

Bookmakers aren’t silly, they also compare their odds with a range of different books around the globe and will realise if their number is off even slightly. Not only that, but there are thousands of other punters with their own systems looking to beat you to the punch and get their bets on.

Betting limits

To make betting worthwhile you do need to get a decent return for your time. No one is interested in simply clicking buttons to make $5 an hour with a $1000 bankroll.

Unfortunately many arbitrage opportunities occur in obscure markets with little liquidity. The day you find an 8% profit arbitrage on Latvian Division 2 Handball is the day bookmakers will offer you a maximum bet of $10.

Resources

Searching for small percentages with few opportunities can severely tie up large portions of your bankroll for large periods of time, restricting you from betting into other markets.

Cancelled bets

Occasionally bookmakers do make mistakes when setting markets. Whether it’s the work experience kid keying in the wrong numbers or a glitch in their software, obviously incorrect odds can be posted from time to time.

When this happens most bookmakers will cancel all bets made at the incorrect price. If this bet forms part of your arbitrage then you will be left exposed with the bookmaker on the other side of the arbitrage with no way to cancel your bet.

Bookmakers don’t like it

While betting exchanges thrive off trading and arbitrage betting, the vast majority of bookmakers hate it and will potentially close your account if they find you are an arbitrage bettor. There are of course exceptions such as Pinnacle Sports, however they really are the exception and not the rule.

Arbitrage betting is certainly something that does exist, and on the rare occasion it can be found it is much better to “trade out” and take even a small guaranteed profit. However it is questionable as to whether it is a long term or sustainable betting strategy that is worth the time and financial resources.

In the coming weeks we will be reviewing an arbitrage betting software package to see if it really does provide the promised profits or whether the difficulty and rarity of arbitrage bets is just to much to bet worth the investment.

Check out our arbitrage betting case study to see how we made 33% profit in just one weekend!

About The Author

Daniel is the founder, owner and editor of Sport Betting Insider. When he's not writing content for SBI you can usually find Daniel cheering for the Sydney Roosters, spending Sunday nights watching Daniel Ricciardo, wishing he owned a Baggy Green, or at Canberra Stadium.

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