Antepost: Rounding Up the Best Betting Markets

Arbing
You can argue day and night that poker is a game of skill. However, at the end of any one of those given days, no matter how well you play, you can still be a loser. You can argue that gambling is a mugs game, but on any given day, done correctly, you will prove otherwise.

How can that be? The answer: Arbitrage.

Dictionary definition: (n.) The simultaneous purchase and sale of the same securities, commodities, or foreign currency in different markets to profit from unequal prices.

Of course the majority of us will be more inclined to place bets on sporting events rather than trade the global currency and commodity markets, but thankfully, all the principles are the same.

Betting arbitrage opportunities arise in betting markets due to either bookmakers’ different opinions on event outcomes, or plain errors. In short, through shopping around the scores of high street and online bookmakers there is such a thing as a sure thing.

Arb’s, as they are known, most commonly occur in two-result matches such as tennis and darts (the Premier League apart where games can be drawn). One player may be even money with most firms and his opponent 4/5 but occasionally it is possible to find a firm offering that opponent at odds against.

It is marginal stuff. A typical arb is around two percent meaning large bets must be placed in order to show a decent profit, but allowing for the fact that you can place your bets quickly and with ease, this is no-lose betting.

During some special or more obscure events an arb’s profit margin might reach as much as 20 percent but, as a consequence of the event being low-key, placing sizable bets is far more difficult.

As well as traditional fixed odds bookmakers the betting exchanges, where the markets are driven by the opinions of thousands of punters, can be a fruitful source of arb opportunities.  Here you can often back one competitor at a fixed price and lay at a lower one. However, with exchanges charging commission on winning trades, the guaranteed profit margin will again be small.

Arbitrage is not simply the act of buying a product in one market and selling it in another for a higher price at some later time. The transactions must occur simultaneously to avoid exposure to market risk, or the risk that prices may change on one market before both transactions are complete. In practical terms, this is generally only possible within markets which can be traded electronically.

Anyone setting out to Arb markets professionally must have their shop in good order too.  They will need:  

• Open accounts with scores of bookmaking and exchange firms.
• To get a guaranteed minimum win size/liability limit accepted by those bookmakers.
• To know each betting company’s rules and quirks. Some pay out on the ‘winner’ in a tennis match where a player has withdrawn, injured, from a match while others will void all bets on the game.
• The ability to work quickly with excel spreadsheets to calculate stakes, and to place bets on two different sites, almost simultaneously. 
• A lot of time to scan markets and identify arb’s before they appear on odds comparison sites or are mailed out to the public by advisory/delivery organizations.

Sports Personality of the Year
Talking of events where it is difficult to place sizable bets, the BBC Sports Personality of the Year (SPY) looks like Jenson Button’s for the taking. This season, Formula One’s godfathers must be ruing their decision to award the Drivers’ Championship to the driver with the most wins and not the driver who accumulates the most championship points as Jensen had the title all but wrapped up in May after his Monte Carlo win.

His dominance apart, Formula One’s return to the BBC will have a huge effect on the voting public and Jensen is far more appealing than Lewis Hamilton (an unsuccessful SPY candidate the past two years) who has the personality of a wet sponge, the looks of a plastic doll, and impeccable manners. In short, as a personality, he is as manufactured as a boy band.