In the sports betting arena, the word ‘arbitrage’ refers to a mechanism of wagering on all sides of a sporting event with the right combination of odds and stakes in order to come out with a profit notwithstanding the result of the event in question.
Arbitrage is also sometimes referred to as sure betting because it guarantees profits. This arena is however limited to folks who have a lot of liquid money that they can pump in to begin with, and are in it for the long term. In order to succeed with arbitrage/sure bets, one needs to start with a capital of, for instance, at least £25,000 in order to make £5,000 on a monthly basis.
This explains why the number of people involved in such dealings is quite limited and the vast majority of online sports betting enthusiasts prefer conventional forms of betting to arbitrages.
For someone who makes his money from dealing in shares, arbitrage betting provides better return than the share market can ever do. In this form of betting, every deal provides an average return of 2.5% while the potential profit per month that arises from such a venture may be close to 25% of one’s total investment.
The mere fact that arbitrages easily outdo any other form of conventional business involving large sums of money in terms of return on investment begs the question as to whether they are legal. Arbitrages are absolutely legal as it is simply a process where an arber (person who makes the arbitrage/sure bet) exploits the odds on offer with several bookmakers to make sure of a profit himself.
There is nothing wrong with betting on both sides of the coin if it is profitable. However, as expected, the bookmakers are not much fond of arbers and every bookmaker reserves the right to exclude arbers from their books. There have been instances where people’s account activity has been limited or accounts have even been closed without warning.
Although there are nearly 500 online bookmakers, only around 10% of these have the trust of punters and not one in this pool of trusted bookmakers welcome arbers. Bookmakers take a dim view of arbitrage/sure bets as they view such transactions as unethical. They have a lot of checks to detect which users indulge in arbitrages and block their accounts on their online betting platforms. Hence, even the arena in which one can do business becomes limited when it comes to sure bets.
Besides the monetary aspect, one has to be extremely astute with calculations and fast in order to get the most out of arbitrages. Currently, it is quite easy to study the odds on offer at a particular event from all major bookmakers. With the right calculations and timely investment, a sure bet can land a good profit provided that one can place the bets in time (The odds keep on changing with time and they change quickly if there is a possibility of an arb).
Example of an arbitrage bet: Arsenal play Manchester City in the Community Shield fixture in August and Pinnacle offers 2.18 for under 2.5 goals to be scored while William Hill offers 1.91 for over 2.5 goals to be scored in the match. A bet of £46.69 on under and £53.29 on over at those respective bookmakers will guarantee a minimum win of £2.18.
There is also a chance that arbitrages can go wrong and hence it is recommended to bet not more than 5% of one’s entire capital on a particular arb. For example, if you have a pool of £100,000, you should not be betting over £5,000 for every transaction.
From the point of view of a potential arber, this business demands a lot of one’s time and a lot of effort. Even if one were to succeed in this arena, one’s annual income from such a business is unikely to exceed more than £40,000.
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