GAME & ENTERTAINMENT – GAMBLING & BETTING MATHEMATIC CALCULATOR
Arbitrage Betting
A precise tool.
What is the Arbitrage Betting & How does it work?
Arbitrage betting exploits differences in bookmakers’ odds to lock in a profit regardless of the event outcome. By converting each decimal odd to its implied probability ((p = 1/O)), you can see whether the combined probabilities are below 100 % – the hallmark of an arbitrage opportunity.
When the sum of implied probabilities is less than one, you allocate your total stake proportionally to each outcome’s inverse odds. This ensures that the payout from either outcome will be the same, guaranteeing a net gain after the initial outlay.
The profit margin, often called the “arb percentage,” is calculated as (1 – (p_1 + p_2)). A larger margin means a higher guaranteed profit for the same total stake.
Profit = minbigl(S_1 times O_1,; S_2 times O_2bigr) – (S_1 + S_2)
S_1 = stake on outcome 1, S_2 = stake on outcome 2, O_1 = decimal odds for outcome 1, O_2 = decimal odds for outcome 2
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Frequently Asked Questions
How do I convert decimal odds to implied probability?
To convert decimal odds to implied probability, divide 1 by the decimal odd. For example, an odd of 2.0 has an implied probability of 50%.
What does it mean if the sum of implied probabilities is less than 100%?
If the sum of implied probabilities is less than 100%, it indicates an arbitrage opportunity where you can guarantee a profit by betting on all outcomes.
How do I allocate my stake in an arbitrage bet?
Allocate your total stake proportionally to each outcome’s inverse odds. This ensures equal payout from any winning outcome.
Can you provide an example of arbitrage betting?
Sure, if one bookmaker offers odd 1.5 and another offers odd 2.0 for the same event, the implied probabilities are 66.7% and 50%, respectively. Since they sum to less than 100%, you can bet $60 on the first and $40 on the second for a guaranteed profit.
What are the risks of arbitrage betting?
Arbitrage betting involves transaction fees, exchange rates, and the risk of bookmakers adjusting odds before your bets are placed. Always consider these factors to avoid losses.
How do I find reliable bookmakers for arbitrage?
Research reputable online casinos and sportsbooks with favorable terms and low commission rates. Check reviews and compare their odds regularly.
Is arbitrage betting legal in my country?
The legality of arbitrage betting varies by jurisdiction. It is generally considered legal, but always check local laws to ensure compliance.
Results are for informational purposes only and do not constitute professional advice.