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What is Arbitrage Betting?

Article Details
  • Written By: Luke Arthur
  • Edited By: C. Wilborn
  • Last Modified Date: 28 March 2018
  • Copyright Protected:
    2003-2018
    Conjecture Corporation
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Arbitrage betting is a procedure that involves a bettor placing two simultaneous bets on the same sporting event. The bettor engages in this activity in order to try to produce profits from the game no matter what the outcome is. This situation can be caused by the sports book making a mistake or by differing opinions on the outcome of a game. This procedure can be profitable at times, but it is also risky.

In order to make arbitrage betting work, an individual has to work with two sports bookmakers. The success of this strategy depends on the bettors ability to find two bookmakers with differing odds on the same game. At that point, the individual can place a bet with one bookmaker and then place the opposite bet with the other bookmaker. The difference between the two odds on the games will be the profit that the individual can realize.

Arbitrage betting opportunities can arise when a sports book makes a mistake. Every week, there are hundreds of different games that a sports book can provide odds on. With all of these games, it is very possible for a bookmaker to potentially put the wrong odds on one of the games. When this occurs, bettors can identify the mistake by looking on the bookmaker's website and then placing the appropriate bets.

Most sports gambling now takes place on a global level. Bookmakers try to provide odds on games from around the world so that they can increase their business. The only problem with this scenario is that the bookmaker most likely is not an expert on every sports from every country. This lack of knowledge often contributes to differences in the odds between the global bookmaker and local bookmakers who are more familiar with the sports and teams.

The process of engaging in arbitrage betting is designed to provide profit regardless of who wins a game. Even though this might seem like a very low-risk endeavor, there is some risk involved. One of the biggest sources of risk with arbitrage betting is that an individual has to bet a large amount of capital in order to make any substantial profits from the bet. After the bets are placed, a bookmaker could decide to cancel all of the bets up until a certain point and then change the odds. When this occurs, a bettor could be stuck in a losing position with the other bookmaker.

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