What is a betting arbitrage - what makes the event a sure bet?

Arbitrage definition

A basic definition of arbitrage says that "arbitrage is the activity of buying some goods at a lower price on a cheaper market and selling them immediately for a higher price on an more expensive market". So the arbitrage is rather a wide term and has not to be with reference to sports betting only.

Betting arbitrage definition

A betting arbitrage (also called a sure bet) in a sports betting dictionary is an opportunity of betting which gives you a one hundred percent chance of the win. Well, at least in theory. It consists in choosing the right sport event and usually two (or sometimes three - in the case with the draw possibility) bookmakers which give the highest odds for both of competitors. Then you can bet at the first bookmaker on the first competitor and at the second bookmaker on the second competitor (and sometimes at the third bookmaker on the draw). If you have chosen the sport event (and bookmakers) correctly you can distribute your money between bookmakers in the way you will have an income independently of the result of the event. Look at the betting arbitrage example below.

There are many different types of betting arbitrages but the simplest distinction is that they can involve a draw or not. I will present both of this types.

Very simple betting arbitrage example

Imagine there is a tennis event - a match between Player A and Player B. The odds of one of bookmakers are 2,05 on Player's A win and 1,90 on Player's B win. The other bookmaker's odds are 1,80 on Player A and 2,05 on Player B.
It is clear without a calculator that if you bet 100 USD on Player A at the first bookmaker and another 100 USD on Player B at the second bookmaker you will win 205 USD regardless of the outcome of the match. It means that your profit will be equal 5 USD because you bet 200 USD and win 205 USD. So the event and the bookmakers' odds make a betting arbitrage.

Real live betting arbitrage (without a draw - in tennis, basketball, volleyball and other sports)

Real betting arbitrages looks only slightly more complicated in comparison with the simple example above. We have the match between Player A and Player B again. The first bookmaker has the odds 1,72 on Player A and 2,20 on Player B. The second bookmaker' odds are accordingly equal 1,55 and 2,50.
You can check if it makes a betting arbitrage in a very easy way.

Checking the betting arbitrage

You have to compare and choose the greatest odds on each player. In our example these are 1,72 (first bookmaker) on Player A and 2,50 (second bookmaker) on Player B. Then you have to pick a number (for example 100). If there are more than 2 bookmakers you should take only two of them (one with the greatest odds on Player A and the other with the greatest odds on Player B).
Now you should divide the picked number by the first greatest odds and add to the given result the picked number divided by the second greatest odds.
In our example it will look like this:

Result: 100/1,72 + 100/2,50 = 98,1395

If the result is lesser than the number which we have picked (100 in our example) than the given odds make a betting arbitrage.

Profit

The profit equals the difference between the picked number and the result divided by the picked number:
Profit: 100 - 98,1395 / 100 = (almost) 2%

Winnings

If you would like to win 100 USD (the picked number) you should bet:

• 100/1,72 = 58,14 USD at the first bookmaker on Player A
• 100/2,50 = 40 USD at the second bookmaker on Player B

If Player A wins you will win 58,14*1,72 = 100 USD at the first bookmaker and lose your 40 USD at the second bookmaker. If Player B wins you will lose 58,14 USD at the first bookmaker but wins 40*2,50 = 100 USD at the second bookmaker.
So - regardless of the event's outcome - you will gain almost 2 USD.

Betting arbitrage with a draw (in soccer, ice hockey and other sports)

Betting arbitrage with a draw is similar to betting arbitrage without a draw. The difference is that you should look for three bookmakers - the first which have the greatest odds on Player A, the second which have the greatest odds on the draw and the third which have the greatest odds on the Player B.

Let's assume that there is Team A and Team B. The first bookmaker odds are 1,90 on Team A 3,45 on a draw and 5,3 on Team B. The second bookmaker's odds are equal 1,72 on Team A 3,55 on a draw and 5,0 on Team B. Finally the third bookmaker's odds are 1,65 on Team A 3,45 on a draw and 5,6 on Team B.

Checking the betting arbitrage

The greatest odds are: 1,90 on Team A (first bookmaker), 3,55 on a draw (second bookmaker) and 5,6 on Team B (third bookmaker).
You should check if there is a betting arbitrage similarly as in the "betting arbitrage without a draw" case. Just pick a number (100 in our example).

Result: 100/1,90 + 100/3,55 + 100/5,6 = 98,6577

The result is lesser than the picked number (100) so it is a betting arbitrage.

Profit

Profit: 100 - 98,6577 = (almost) 1.5%

Winnings

If you would like to win 100 USD you should bet:

• 100/1,90 = 52,63 USD at the first bookmaker on Team A
• 100/3,55 = 28,17 USD at the second bookmaker on a draw
• 100/5,6 = 17,86 USD at the second bookmaker on Team B

If Team A wins you will get 52,63*1,90 = 99,99 USD at the first bookmaker and lose your stakes at the others. It there is a draw you will lose your money at the first and the third bookmaker but you will win 100 USD at the second bookmaker. If Team B wins you will lose at the first and the second bookmaker but you will get 17,86*5,6 = 100,02 USD at the third bookmaker.
So - regardless of the event's outcome - you will gain almost 1,5 USD.

Summary

There are some risk however and betting arbitrages are not as easy as they seem. You may read about the risk in the sure bets risks section.

What were you looking for? arbitrage betting, betting arbitrage or maybe sports arbitrage?