An average bookmaker does not provide many avenues for constant winnings, but Arbitrage Betting (also known as arbing) allows for a bettor to gain an upper hand over a bookmaker.
However, for it to work, interaction with (at the very least) three bookmaking companies is necessary. The essence of the strategy is that a bettor has to make a bet on the same event with different bookies. In case if odds are drastically different, you can bet on several betting websites on the same event and get guaranteed results which will cover the expenses.
Let’s have a simple but the most common example. A football match has three possible outcomes: Home team win, draw and away team win.
For instance, a bookmaker 1 sets the following odds for respective outcomes: 2.35-3.15-2.95. The sum of all three possible outcomes equals 1/2.35+1/3.15+1/2.95 = 1.08; (0.42+0.31+0.34=1.08).
It’s important to understand that a bookmaking firm always sets odds in such a way that the sum of probabilities of these outcomes happening exceeds 1. In this case 0.8 - is a guaranteed profit for the company in case you make bets of the same amount on all three possible outcomes.
To ensure profit for yourself, you must find bookmakers with different odds in a way, that the sum of probabilities from three different bookies would’ve exceeded 1.
Let’s assume that the bookmaking firm 2 sets odds on the possible outcomes of the match as follows 2.25-2.8-3.00. Total probability equals 0.44+0.35+0.33=1.12 and the bookmaking firm 3 sets the following odds
3.15-2.8-2.65 with a sum of all probabilities 0.31+0.36+0.38=1.05
To ensure profit, we need to make a bet on home team win with the bookmaking firm 3 (3.15), on a draw with bookmaking firm 1 (3.15) and on an away team win with the bookmaking firm 2 (3.00).
By adding the total sum of all probabilities we will get: 1/3.15+1/3.15+1/3=0.95.
It stands to reason to bet with three different bookies on three different outcomes in the following circumstances. Theoretically, it’s possible to employ only two but only if the probability of all three outcomes will not exceed 1.
It’s worth noting that bookmaking firms sets odds closely. From time to time, however, the discrepancies between odds allow for arbing..
Money distribution for betting on three possible outcomes happens as follows. Let’s assume that we have $1000.
Taking our previous example into consideration:
We bet on the first outcome (1/3.15)/0.95=33% of total amount or $330;
On the second outcome (1/3.15)/0.95=33%, or $330;
On the third outcome (1/3.00)/0.95=36%, or $360.
Minimal no-risk guaranteed winning is $30, max - $60.