Arbitrage Betting & Free Bets Explained

Profitable Betting Strategies

Imagine if you could bet on both sides of a game and make a profit regardless of the outcome, every time. Sounds too good to be true? Maybe not.

The sharpest gamblers out there know how to make some free money off of sports betting sites. Sure, one way is to take advantage of deposit bonus offers – and the smart gambler does just that, but there is another way if you understand “risk free betting”. The method is called arbitrage betting and essentially uses the same investment principals used by Wall Street traders for years, to make guaranteed profits, almost risk free!

What is Arbitrage Sports Betting?

Arbitrage is the well known investment practice of “simultaneously buying and selling the same securities, commodities, or foreign exchange in different markets to profit from unequal prices.”

The concept can be perfectly applied to sports betting except what you are “buying and selling” are the odds and the “different markets” are two competing sports betting sites. You are betting on both teams to win and if the two sports betting sites have sufficiently “unequal prices” or odds, you’re guaranteed a profit no matter the outcome.

So how often do profitable arbitrage situations occur you ask? You may be surprised to learn that they happen hundreds of times every day. Arbitrage sports bettors have been practicing this technique for years, some making a very decent living from it.

The Secret Behind Free Betting?

In arbitrage sports betting, you are trying to take advantage of a situation where prices on the board are different enough to turn a profit with no risk involved. Let’s take a baseball game as an example. For simplicity, let’s use a sport where there will be a definite winner and there is no possibility of a tie.

We’ll take a hypothetical game here between the New York Yankees and the Boston Red Sox. Let’s say that has the Yankees at -160 and the Red Sox at +140, while Bovada has the Yankees at -135 and the Red Sox at +115.

Here, we have a clear example of arbitrage. You can bet the Red Sox at +140 at Bookmaker and the Yankees at -135 at Bovada. To make this an even split so that you guarantee yourself the same profit, you would bet $138 to win $102.22 on the Yankees at Bovada and $100.09 to win $140.13 on the Red Sox at Bookmaker.

If New York wins the game, you win the $102.22 at Bovada but lose $100.09 at Bookmaker, netting you a profit of $2.13. If Boston wins the game, you win $140.13 at Bookmaker but lose $138.00 at Bovada, giving you a profit of the same $2.13. Obviously, you have the exact same profit either way.

This works on ‘totals’ as well. If Bookmaker has the ‘total’ posted for the exact same game at 7.5 over -110, and Bovada has the ‘total’ posted at 7.5 under +115, you have an arbitrage.

However, in this case, let’s say that you have a good feeling that the ‘under’ is the right side. Instead of creating an even split, you can make this a risk free bet instead. You can bet $110 to win $100 on the ‘over’ at Bookmaker and $100 to win $115 on the ‘under’ at Bovada. Obviously, if the game goes ‘over’ the ‘total’, you end up in a situation where you break even. If it goes ‘under’ though, you’ve made $5.00 profit, which is over double what you would have made had you split the bet evenly.

Before you even think about betting an arbitrage in baseball though, you have to make some careful considerations. Ask yourself why this is an arbitrage situation. Is there information that is out there that one sportsbook doesn’t have yet that might cause that book to void that bet? Are the starting pitchers listed differently? Do these sportsbooks have the same rules?

This concept about having the same rules is going to come up over and over again in this article. MLB is a bad example about rules, because pretty much every book recognizes that both listed starting pitchers have to start the game for it to have action, and both recognize any game as an official game once it goes five innings (4.5 innings if the home team is leading). For ‘totals’, games have to be completed for the bet to stand.

Arbitrage in Head to Head Match Ups

You can find arbitrages in virtually every single sport, though it will be easier to do in baseball than in most others in all likelihood.

Tennis and UFC (or boxing) are both also popular sports to find arbitrages in, as is hockey with both moneylines and puck lines. One sports betting site could have Rafael Nadal at -200 to beat Roger Federer, and the other might have Federer at +205. The concept is the same.

Be careful with tennis, however. Tennis betting rules may differ between the top sports betting sites. There is no such thing as a universal set of rules for tennis. Some sports betting sites consider the match official after just one set, others require that the match goes at least two sets, and others still require that the match is completed for the wager to be graded.

Again, make sure that the sports betting sites you’re creating arbitrage with have the same set of rules, or you could find yourself in the unfriendly situation of having a losing wager and a voided bet instead of a winning wager and a losing wager.

It’s Not Quite Arbitrage, But it’s still Profitable

Okay, basketball and football fans. We hear you. We know that we listed every other sport known to man in the section above, but we never talked about football and basketball! There’s a good reason for that.

Yes, you can find arbitrages on moneylines from time to time, but for the most part with spreads and ‘totals’, lines are listed at -110 prices, and rather than changing the juice that you have to pay to place the bet, most sportsbooks just move the lines.

However, don’t think that you can’t create a minimal risk betting situation from football and basketball as well. College football is probably the easiest to do this with because lines do vary so much from sportsbook to sportsbook, particularly in some of the smaller games.

We’ll take Conference USA for an example (and this works with college football or college basketball, by the way). The SMU Mustangs are theoretically -2.5 at Bovada, while the Marshall Thundering Herd is +3.5 at at the exact same time. It doesn’t take a genius to know if you bet +3.5 on one side of the game and -2.5 on the other side of the game that you will win both bets if the game lands on the favored team by exactly three.

However, this isn’t quite an arbitrage. Remember, at most sportsbooks, both of these lines are going to be -110, meaning you have to risk $110 to win $100. In this and most other cases, you’ll be winning $100 for one bet, but losing $110 for the other, creating a loss situation. Your risk here is 4.55% ($10 worth of loss divided by $220 worth of risk).

So let’s run some quick math. If you end up in a situation where you are risking 4.55%, you need to win at least 1 out of 21 times to breakeven. In this example, you’d have one winner where you would win $200 and 20 losers where you would lose $200.

Of course, there’s a big difference between betting on a split of -2.5 and +3.5 in football (where you get the pivotal ‘3’ on your side) and betting on, say -4.5 and +5.5. In most situations, the former would be profitable in the long run (meaning it would win at least 1 out of 21 times), while the latter would be a dud (since most games don’t land on ‘5’ as the winning margin of victory).

How to Make Futures Quasi-Arbitrages

This final way to risk free betting isn’t quite risk free either in all situations, and it requires that you be a very advanced gambler with a tremendous foresight into the future. We don’t recommend using this type of logic with more than two or three games at most that could change the outcome.

In the NBA Finals for example. We’ll say that the Dallas Mavericks were up 3-2 in the series against the Miami Heat with Games 6 and 7 being played in South Florida. At this point, you’d see that the Heat would be listed as -5 favorites, or roughly -200 on the moneyline. You know if Miami were to win Game 6, it would roughly be the same price on the moneyline in Game 7 in all likelihood.

You might think that you can’t parlay Game 6 and Game 7 together, but in essence, you can. Say you take $200 to win $100 on Miami in Game 6 and it wins. To in essence make this a parlay, you’d bet $300 to win $150 on Miami in Game 7. Your ultimate risk is just your initial $200, but the ultimate prize is $150.

Now, picture if the Mavericks were +150 to win this series before Game 6 tipped off. You could bet $140 to win $210 on the Mavs to win the series, and you’d have your de facto $200 to win $150 on Miami for the series for winning Game 6 and Game 7, which creates an arbitrage. You can often times find these arbitrages within just one sportsbook, as futures lines and game lines often don’t even come from the same department.

The risk here though, is that you aren’t totally sure what the game line for Game 7 would have been. Perhaps Miami blew Dallas out of the water in Game 6 and the Game 7 line was Miami -7, or a -270 moneyline. All of a sudden, that Game 6 win that netted you $300 ($200 wagered and $100 won) would only be winning you $111.11. Now you’d have essentially $200 to win $111.11 on Miami and $140 to win $210 on Dallas, which obviously puts you in a losing situation.

This is why you really have to know what you’re doing before you take on this technique, and why you aren’t going to want to do this more than two, possibly three games out. The more variables there are, the riskier this technique gets.

Just picture Miami winning Game 6 and Dirk Nowitzki and Jason Terry both getting hurt and not being able to play in Game 7… The Heat might be -400 on the moneyline in that case, and your once solid looking bet would be blown to smithereens.

Why Isn’t Everyone Doing it and How “Sure” Are Sure Bets?

Arbitrage betting is not an easy game to play, and requires time and dedication to make it worth your while. Remember that profit margins are awfully small in these examples, and the likelihood is there that you are going to have to pay some significant fees to be able to get your money out of an offshore sportsbook.

Not only do you have to value your time, as this can be a very time consuming event on a daily basis, but you have to remember that $50 worth of arbitrage profits over a period of time can be wiped out by fees on a single withdrawal.

Do You Need Arbitrage Software or a Sports Betting Calculator?
Any serious arbitrage sports bettor won’t be able to search all the odds on every sports betting site manually. It’s just too much work. A sports arbitrage opportunity only exists for a short time, usually between 1 to 5 minutes, before they are spotted and corrected by the sportsbook lines managers.

You’ll need to use one of the many arbitrage services so you can get as close to real time odds as possible from the sports betting site. We’d recommend you look at RebelBetting or BetBrain. Keep in mind that they are not free.

Don’t the Top Sports Betting Sites Frown on Arbitrage Bettors?
Sportsbooks also don’t look kindly upon arbitrage. If you are caught, the possibility is there that your limits could be slashed, which will hurt your ability to make the most of your money.

In the olden days of sports betting without the internet, gamblers used to hire “beards” to place some of their arbitrage bets so they wouldn’t get caught by the bookies. With the internet providing so many more options, arbitrage is something that you can do from the comfort of your own home without any help, but you do run the risk of the sportsbooks, particularly those that are in the same families, catching up with you.

The final warning about arbitrage is that you are going to need a huge sum of money to make this profitable. If your profit margin is only 1.5 to 2.0 percent, doing this with $100 per game on each side just isn’t going to add up all that quickly and won’t be worth your time.

On top of that, even if you are creating arbitrage with $100 per game on each side, the likelihood is there that you are going to need at least $2,000 at every online sportsbook that you play at, and perhaps even more to make sure that you are remaining funded relatively evenly at all of your sportsbooks.

Deposit and withdrawal fees can really catch up with you if every few days, you need to re-appropriate your funds. Obviously, only having one sportsbook isn’t likely to create an arbitrage situation for you, which would defeat the purpose altogether.

The Risks and How to Avoid Them

As with any type of investment there will always be some risks involved. We’ve listed some below along with a few ways to avoid them:

Bet cancellations
Sportsbooks can cancel or void your bet if they make an obvious mistake, called a “palpable error” or “palp”. An example would be a reversal of the odds on a game or typo. This is the single biggest problem in sports betting arbitrage. To minimize the risks of this happening there are some steps you can take:

1 – Look for odds that seem to be reversed and avoid them.

2 – Compare odds with other bookmakers. If the odds are way off, it’s probably a mistake.

3 – Always confirm your bet before placing the second part of your “arb”.

4 – If your bet is cancelled, never leave your uncovered bet open. Cover your bet as much as you can if the bet is voided before the match begins. If the bookmaker voids your bet during the match, try to cover your bet as best as you can with live in-play betting. You might have to lock in a small loss, but that’s better than losing your entire stake if you leave your bet open. If the bookmaker voids your bet after the match is complete (not very common, but it happens), there is nothing you can do.

Human error
This is always a risk that depends on you. Some examples of common mistakes would be if you accidentally bet on the wrong team, or if you realize after you have bet at Bookmaker, that you don’t have enough funds at Bovada to complete your arb.

Another example would be if you bet on a game that is about to start in 2 minutes and the odds change while you are in the middle of betting, you might end up with an open bet on one of the teams when the event starts. To minimize the risks of this happening there are some steps you can take:

1 – Double check your bets before confirming – the teams, odds, date and time of event, bet amount etc.

2 – Don’t bet on games that will start in just a few minutes – give yourself ample time to correct errors.

Line moves
Lines moves is the most common risk in arbitrage sports betting. This is part of the business. You will take a small loss from time to time – accept it.  It happens occasionally that you have confirmed a bet at Bookmaker and the odds have changed at Bovada, making the arb smaller, or even a negative. These line move “traps” will happen less frequently the more you practice.

To minimize the risks of this happening, don’t place an arb on games with a lot of line movement. Some bookmakers are fast when changing odds, and you could get “caught in the middle” when placing an arb on these games. You could successfully place the bet on Team A, but when you confirm your bet on Team B, the odds might have changed.  Always confirm your bet with the sports betting site you think is least willing to accept your bet first.

Wager limits imposed
If you use your betting account solely for arbitrage betting, sports betting sites will eventually limit your wager amounts. If you are a constant winner, they will limit you sooner or later, or even close your account. Some books limit you if you consistently bet on palpable errors. To minimize the risks of this happening there are some steps you can take:

1 – Round your wager amounts to even amounts instead of betting $537 at a single bookmaker, bet $535.

2 – Do not bet on obvious mistakes or palps. This is a sure way of getting limited. Obvious arbitrages should immediately raise a red flag.

3 – Keep withdrawals to a minimum.

4 – Think twice about betting on obscure leagues and teams – it might raise eyebrows.

Did you find this article useful? You may also be interested in our “Honest Guide to Online Sports Betting and the Top Betting Sites for 2016

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Having worked in the marketing department at two online sports betting sites, John brings his love of sports to serve BigOnSports as chief writer. He will be researching and writing about the sports betting community to improve your experience as a sports bettor.