Sometimes it is smart to bet against yourself! Hedge betting opportunities can be hard to find, however, once you understand the concept, you will be applying it to many of your outrights, multiples and live bets. In this article, we will discuss when to hedge your bets and how to calculate your hedging stakes.
Table of Contents
- Best Betting Sites We Recommend For Hedge Betting
- Best Betting Sites for Hedging Your Bets
- What is Hedging?
- Hedging Formula
- Hedging Bets at Betting Exchanges
- Hedge Betting Calculator for Exchanges
- Hedging Betting Strategy
- Hedging FAQs
- ThePuntersPage Final Say
Best Betting Sites We Recommend For Hedge Betting
New customers only, max £20 cash refund. Bet must be placed in first 7 days of account opening. Payment restrictions apply. T&Cs apply.
1. Once the bonus is credited to your account, losses will be refunded up to the bonus amount. 2. You must deposit at least the qualifying deposit of £20 (or currency equivalent) in a single amount with your first deposit to be eligible for the rebate. 3. To withdraw rebated funds, you must bet at least the qualifying deposit on any combination of markets within the promotional period; otherwise rebated funds will be forfeited. 4. Unused bonuses expire after seven days of being credited to a user account and will be removed after this period. 5. Users making their first deposit by Skrill, Neteller, PayPal or a virtual/prepaid card will not qualify for this promotion. 6. The sign up offer is strictly limited to one per individual, family, household address, email address, same payment account number, and shared computer. 7. This promotion cannot be used in conjunction with any other sign-up promotion. 8. Smarkets standard terms for promotions apply.
18+ only. Certain countries only. API/RDT customers excluded. Min £10 exchange or sportsbook bet at odds 2.0 or greater within 14 days of acc reg. Free bet valid on exchange for 7 days. Stake not returned. Depositing directly via bank card. No cashout. New customers only. The free bet will be credited within 72 hours to your account once the staking requirement has been met. T&Cs Apply.
What is Hedging?
Hedge betting means placing bets on different outcomes on a single sporting event, which will help you minimise losses or even guarantee profit, regardless of the outcome. It usually involves capitalising on movement in odds for bets you have already placed.
There are multiple hedging strategies which can guarantee profit. Usually, these opportunities will not present themselves naturally. It takes a sharp mind and a fast response to deal with changing odds on various markets.
Hedge Betting Versus Arbitrage Betting
While arbitrage betting also involves wagering on multiple outcomes, arbitrage refers to betting on two outcomes for the same event at the same time. This is usually done by comparing odds at different bookies that have opposite favourites.
Hedging usually involves taking advantage of movement in odds. If you see odds changing drastically for a bet you have already placed, you can consider betting against yourself in order to compensate for any loss, or to make sure you make a profit regardless.
If you want to calculate your optimal stake for hedging, use this formula:
X = (P + W1) / O
- P = Profit from your first wager
- W1 = The stake from your first wager
- O = Decimal odds from your second wager (use our odds calculator to convert odds)
If you want to calculate your total winnings, subtract X (your hedge wager amount) from P (your profit from your first wager).
- P – X = Your guaranteed profit
Let us imagine you had placed £100 bet on tennis futures, at odds of 7/1 (8.0), (for example, on a player to win Wimbledon). Your selection makes it to the final, while the opposing player gets odds of 4/5 (1.8) to win. Using the hedging formula, you can calculate:
- P = £700 (Payout 800 minus stake 100)
- W1 = £100
- O= 1.80
- X = (£700 + £100) / (1.80)
- X = £444.44
- £700 – £444.44 = £255.56
This means that if you also bet £444.44 on the other player, you will win £255.56 regardless of which player wins. That is why hedging can be so profitable.
Hedging Bets at Betting Exchanges
- They allow you to back or lay any type of bet. While most bookies only let you bet on 2 or 3 outcomes, you can bet against a specific outcome by placing a lay bet. This allows you to bet directly against yourself.
- You have no chance of being gubbed, since you are betting for other players’ money. While regular bookies may frown upon smart betting strategies such as hedging, exchanges have no issue with them, as they charge a 2% commission on exchange bets.
Lay odds can be tricky. While back odds work the same way as regular odds, lay odds come with liability, meaning you can potentially lose more than you bet.
Lay bets mean betting on something not to happen. If you place a lay bet for a team to win, you are betting that the team will not win, meaning you are betting on a draw or the other team to win.
Betfair Exchange Lay Odds: Example
Let us use a lay bet at odds of 2.0 (1/1) for £100 with 2% commission at Betfair Exchange as an example.
If you win the bet, you will win £98 for your £100 stake. However, if you lose your bet, you will lose £100, plus £100 liability, adding up to £200.
Hedge Betting Calculator for Exchanges
Our hedge betting calculator will help you calculate how to place lay bets for betting exchanges, a tool which can really come in handy if you wish to bet against an event. Keep in mind that lay odds work differently than regular odds (see above). If you want to calculate for regular odds instead of lay odds, use our arbitrage calculator instead.
How to use the hedging calculator:
- Under back odds, enter the original odds of your bet.
- Enter your original back stake.
- Under Lay Odds, input the odds you wish to lay.
- You will see your net profit for various lay bets.
Hedging Betting Strategy
There are plenty of ways you can take advantage of movements in odds. Here are a few of the main strategies for hedging bets.
Outright market hedging
An outright market lets you bet on who the final winner of a tournament or competition will be. For example, you can bet on the Champions League winner, the Premier League winner, the top goal scorer, who will win Wimbledon and so on.
Usually odds start very high, even for favourites, but gradually get lower as the competition progresses. For example, a team with odds 10/1 as outright winner might have odds 3/1 or lower as the season progresses. As odds for a certain win get lower, odds for that win not to happen get higher. You can take advantage of this by laying the bet or placing an opposite bet.
Early on in a hypothetical Premier League season, most bookies are offering odds 2/1 (3.00) as for Manchester United to win the league. You feel confident in your bet and put down a bet of £100. You see good value in this, as the team has a good squad and you want to take advantage of the odds while they are still high.
If Manchester United wins the league, you stand to win £300, with a profit of £200.
However, as the season progresses, you see that Liverpool is also doing well and is only a few points behind. Although you are confident Manchester United still has a good chance, you want to guarantee profit. While you could sit back and watch the rest of the season nervously, you could also hedge your bet.
This is where betting exchanges come in handy. By choosing lay odds (betting for something not to happen), you can insure yourself against loss. At the time of writing this article, Betfair is offering 1/4 (1.25) odds for Manchester to win, meaning you can place a lay bet on these odds. If you bet £100 on Manchester United not to win, you will effectively ensure yourself against any possible loss:
An even better approach is to guarantee profit. Any bet over £80 (the minimum bet at 1.25 to cover your potential loss) and below £300 (your potential payout if you win) will ensure you make a profit.
An optimal bet would be at £236.80, ensuring that you get a profit of 136.80, regardless of the outcome.
Of course, this is a hypothetical example. To find a real example, you will need to pay close attention to changing odds.
In-play hedging works just the same way as outright hedging. The only difference is that you will have to be very sharp, watching the odds as they progress during a game.
You placed a pre-match bet on team A to win at 2/1 (3.0). Your team is doing well. After 70 minutes, the score is 1 – 0 to team A. The odds are going down for Team A to win, and are now only at 3/5 (1.6).
You can hope for your team to win, or place a lay bet on Team A to win (which is essentially betting on them not to win). By betting £188, you are assuring yourself £86 regardless of the outcome!
Parlays can be a very good way to build your bankroll fast. However, the more selections on your bet slip, the more chances you have for something to go wrong. One common way to ensure profit is to ensure your last bet if your first selections are correct. For this type of hedging, any bookie or exchange will do.
MMA Betting Example
At the Betfair sportsbook, you place an MMA Treble on 3 fighters: Overeem, Rosa, and Pereira. You bet £100 at combined odds of 4.53, meaning you can win up £353 if your bets are all correct. As the night of fights progresses, Rosa and Pereira both win their fights.
You could sit and wait for the Overeem – Sakai fight, or you could place a bet on Sakai as well to ensure profit. Sakai is the underdog at 2.4.
Using our Arbitrage calculator, you bet £188.75 on Sakai. (In this instance, we are not using an exchange, so no laying odds).
Now, if Overeem wins, you get the total treble paid out at £452.92, total stake 188.75, with guaranteed a profit of £164.75.
If Sakai wins, you get the same payout of £452.92, total stake 388.75, with a guaranteed profit of £164.75.
Of course, this betting strategy will reduce your potential profit, but since it guarantees profit anyway, it is the smarter one.
Hedging your losses
This is a more basic hedging strategy, and usually does not involve guaranteed profit or even breaking even. If you feel you have made the wrong bet, you can simply bet against yourself. If odds are not showing any movement beneficial to the opposite outcome, you can place a bet on the opposite outcome.
Some bookies do not allow you to cash in your bets, so this can be a smart way to minimise losses on a bad bet.
This strategy does not come with guaranteed profit, though there is no reason you cannot place a larger bet than your original one.
Matched betting is a way to cover all potential outcomes and still make a profit by taking advantage of welcome bonuses, free bets or other promos. All you need to do is place an opposite bet at another bookie.
Free bet example
Bookmaker A offers a £20 free bet.
- You use the free bet on outcome A of an event, for example, Manchester United to win. You place it at your regular bookie.
- You now head to an exchange betting site and place a lay bet on Manchester United to win.
Since you have nothing to lose on the free bet, and the winnings from it can cover any potential loss on your lay bet, you can expect a guaranteed profit.
This strategy can make you some cash, but usually not that much, since bookies welcome offers are £20 or less.
💲What is hedge betting?
Hedge betting means betting against yourself. By using movements in betting prices for the same event, you can protect yourself from losses or ensure profit. You do this by placing a bet on the opposite outcome if odds for your bet have gone down considerably.
💯 Is it smart to hedge a bet?
If you do it the right way, hedging is a valid strategy which can create a sure profit. Of course, you can usually only hedge your bet if you see odds move after your bet is placed.
✔️How do bookies hedge bets?
While hedging is a smart strategy for punters, bookies always hedge bets to try to ensure they will have a profit regardless of the outcome. They do this by moving the betting lines depending on how much money comes in on each side. They also have an average 2% edge.
🥇How do you calculate hedge bets?
You can use our free hedging calculator to calculator your bets.
🏆What is the difference between arbing and hedging?
Hedging is a similar strategy to Arbing. However, there are key differences:
- Hedging uses movement of odds to bet against yourself to guarantee a profit.
- Arbing is taking advantage of discrepancies between different bookies to bet on opposite outcomes of an event.
❌When is hedge betting a bad idea?
Hedging is a bad idea if there is no movement or difference between the odds. If the odds do not change, it will be almost impossible to make a guaranteed profit by hedging.
❓Can you hedge sports bets for a profit?
Hedging bets can help you make a profit, though it is hard to guarantee this since you do not know beforehand if or when odds will move.
✅Is hedging illegal?
Absolutely not. As long as betting is legal in your country, you can place as many hedged bets as you please. However, we recommend you do not place your hedge bets on the same site as you placed your original bets, as this may be frowned upon by bookies and could get your account limited. Exchanges are the way to go, though the amount you can bet depends on how much other people are betting.
ThePuntersPage Final Say
‘Hedging your bets' is a common phrase, used in many different contexts. However, in terms of betting, it means betting against yourself to ensure profit. If odds for your outcome have moved drastically downwards, you can consider placing a lay bet (backing the opposite outcome) on your bet, or placing a regular wager on the opposite outcome. If the odds are right and your second bet is the right size relative to the first, you will have a guaranteed profit!