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Our Quick Guide to Betting
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The full list of available articles on How to Bet that you may find of interest
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Arbitrage trading is the practice of taking advantage of a price differential between two or more markets. In sport, an arbitrage, or arb as they are more commonly know as, exist when bookmakers have a different opinion regarding a sporting event. Normally if you placed a bet on each possible outcome with the same bookmaker, whatever the result you would lose money.
But if there was a bookmaker who was out of line compared with all the others you could bet on all possible outcomes with different bookmakers and make a profit whatever the outcome.
For example, a football match in which team A plays team B. Lets say William Hill are offering odds of 9/1 on team A winning, Ladbrokes are offering 7/4 on team B winning and Coral 2/1 on a draw. We can calculate with the help of an arb calculator that if you placed a total of £100, split the following way, £12.75 for team A to win with William Hill, £44.74 on team B to win with Ladbrokes and £42.51 for a draw with Coral then you cannot lose.
How? Well if team A win you would pick up £127.52 from William Hill. If team B won you would pick up £127.52 from Ladbrokes and if it was a draw then you would pick up £127.20 from Coral. Whatever the outcome you would have made over £27 profit, that's 27% for a few minutes work.
Now for the catch. Arbs appear and disappear very quickly as soon as the bookie realises he is out of line. So Arbs are only suitable for people who have time to sit in front of their computer all day. However if you are interested in arbs, you can find out more here.
Of course for a hose race unless there are only a few runners it won't work. However, there is an alternative called Dutching. This involves placing money on several horses, just the horses most likely to win.
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