An ‘Arb’ is when a Bettor has the opportunity to place multiple bets on a sports event using different betting companies, and make a profit regardless of the outcome. When using the right tools sports Arbing (or ‘Arbitrage Betting’) is straightforward, procedural and potentially very lucrative.
There’s no doubting that it works. The question is, to what extent?
I’ll explain each of the pros and cons of sports arbing in this complete Arbitrage Betting Guide. Then you can decide if it’s worth the effort…
The Basics Of Arbitrage Betting Explained
The definition of Arbitrage, in it’s general form, is:
The simultaneous buying and selling of commodities in different markets in order to take advantage of differing prices for the same asset.
In the case of sports Arbitrage the “commodity” is an outcome you bet for (“buy”) and simultaneously bet against (“sell”). The “prices” are the odds. Arbitrage bettors take advantage of the difference in those odds. It has nothing to do with making predictions.
Note that sports arbs are sometimes referred to as “sure bets”, “sure wins”, or even “safe bets”. In this context, it means exactly the same thing.
So How Do You Arb Bookmakers?
The simplest form of sports arbitrage opportunity is where the betting exchange Lay odds are less than those offered by the bookmaker.
For example, if bookmaker has 10.0 for a horse and the exchange Lay odds are at 9.0 then this is an arb. A bettor has the opportunity to secure a guaranteed profit by employing the “Back high, Lay low” trading philosophy at that moment in time.
Help, I’m Lost! How does that Make a Guaranteed Profit?
Ok. If you’re stuck then it’s probably because you aren’t familiar with the Betfair betting exchange.
Basically, for Arbing you need to ‘cancel out’ your Back bet at the Bookmaker by Laying on Betfair. By placing a Lay bet, you’re betting against the outcome that you’ve Backed (at the Bookie), ensuring that you have no risk. The difference in the odds between the Bookmaker and Betfair means that you don’t merely break even — instead you guarantee a profit after the sports event settles.
That’s the basic Bookmaker/Betfair arbitrage betting strategy. You can win at either the Bookmaker or on Betfair, it makes absolutely no difference to you!
How Much Can You Earn from Arbing?
The answer is dependent on a number of factors (which I address later in this post) — the biggest being detection. If a Bookmaker detects that you’re arbing then they will limit or close your betting account. This is known as gubbing (e.g. “I’ve been gubbed.”)
How long you’re able to arb for before being limited/closed determines how much you’re able to earn. It’s a question of turnover. If you’re able to place a large volume of total stakes, then your profit will be proportionally large. A small volume results in small profits. It’s as simple as that.
Arbs Sound Great So Far. Do they Happen Frequently?
Arbs are an everyday occurrence due to the volatile nature of betting markets. Bookmakers have to actively monitor all other available odds in order to quickly prevent shrewd punters from taking advantage of their odds by arbitrage betting.
Sport Arbing opportunities occur at Bookmakers based in any country — not just the UK.
How Can I Find Arbitrage Bets? Where Can I Find Arbs?
It’s impossible to find enough arbs manually (i.e without the use of an arb finder) to make it a viable earner.
In my post What’s The Best Sports Arbing Software? I review and recommend the best, most cost-efficient arbitrage finders. These products provide a consistent flow of arbs which appear the moment an opportunity arises. They make the arbing process incredibly straightforward.
For free arbs I recommend signing up to Bet Burger or OddsMonkey.
If you decide to use OddsMonkey for finding arbs, you need to load up their free Oddsmatcher. Until you upgrade to Premium (which is only £19.99 /month) it’s limited — but it will still give you a feel for Arbing and Matched Betting.
An Example of Arbitrage Betting (Maths Included)
Let’s work through the previous example using a £10 stake at the bookmaker. To simplify the calculations, I assume 0% commission paid on the exchange. Usually you’d pay 5%.
Here are the possible outcomes for the arbitrage bet:
Bookie: (£10 x 10.0) - £10 = +£90 profit Exchange: -(£10 x 9.0) +£10 = -£80 loss Net result = +£10
Bookie: -£10 loss Exchange: £10 win Net Result = £0
What this achieves is great for the bettor: it’s either make £10 or break even at £0.
But this approach does not guarantee a profit each time; if the exchange bet wins then it returns zero profit. The solution to this problem follows…
Calculating Guaranteed Profit From an Arb
To guarantee a profit from an arb the risk must be spread over the outcomes of the event. This is achieved by adjusting the Lay stake using a simultaneous equation… or by using an online Matched Bet Calculator, treating it as a “qualifying bet”. However, most Arbitrage Finders also include calculators which tell you exactly what to stake.
Please skip over this entire section if you’re put off by the mathsy stuff. But if you’re interested, or want to incorporate the calculations into your spreadsheet, then here’s how to work out the Lay stake.
Firstly you need to consider:
- If the Bookie bet wins, the exchange bet loses.
- If the Exchange bet wins, the Bookie bet loses.
So what you need is a basic formula which combines the two above scenarios and seeks to find the value “LayStake”, such that both scenarios will always yield the same result:
Create the unknown variable “LayStake”:
(BookieBetWins BookiePNL) - ((ExchangeOdds-1) x LayStake) = (ExchangeBetWins BookiePNL) + (LayStake)
Using the figures from my previous example:
- BookieBetWins BookiePNL = £90
- ExchangeOdds = 9.0
- ExchangeBetWins BookiePNL = -£10
Note: “ExchangeOdds-1” works out the Betting Exchange loss without needing to subtract the LayStake separately (as I have done previously). This just simplifies the formula a little bit.
Substitute in the values:
(£90) - 8.0(LayStake) = (-£10) + (LayStake)
Rearranged & Simplified:
£90 - 8(LayStake) = -£10 + LayStake £100 = 9(LayStake) LayStake = 100/9 = £11.11
OK, that’s enough of the algebra.
Now the risk is spread across both outcomes, albeit a slight rounding difference of £0.01. Thus the player has achieved a positive, equal result for any outcome.
At bookie: (£10 x 10.0) - £10 = +£90 profit At exchange: -(£11.11 x 9.0) +£11.11 = -£88.88 loss Net result = +£1.12
At bookie: -£10 loss At exchange: £11.11 win Net Result = +£1.11
Do Arbs Bother The Bookmakers?
Theoretically the bookmaker’s overround would ensure that profits are realised on every event, regardless of whether a small percentage of customers are arbitrage betting. This assumes that their books aren’t hugely unbalanced, of course.
The issue is that the occurrence of an arb usually represents a shift in the exchange odds, leaving one or more bookmakers behind. At those moments in time the bookmaker offers odds above the market value, which is great for bettors. But unfortunately giving value to bettors isn’t in keeping with the bookmaker’s business model, so they close the opportunity as quickly as possible and try to reduce how frequently it happens.
Furthermore, bookmakers don’t want to facilitate too many gamblers that show evidence of a capitalistic mindset. In finding arbitrage bettors the bookmaker identifies customers with the likelihood of profiting by other means — bonus abuse, or value betting for example. Therefore they simply discontinue doing business with them at the earliest point possible.
How Difficult Is Arbing?
The process and logic behind arbing is pretty simple — you Back high, and Lay low. You’re betting on all outcomes to ensure you never lose.
If the odds stayed still then arbing would be extremely easy. But in reality it’s a little harder than it seems. Placing bets on arbs throws several logistical complications…
First and foremost, arbitrage bettors require sufficient funds in their bookie accounts to fulfil their back bets as well as the liability requirement on the exchange. This might be a stretch, or simply not an option for some.
2. Speed & Efficiency
When an arb occurs bookmakers change the odds very quickly to close the opportunity. Products like RebelBetting are therefore required to identify arbs as soon as they appear. Learn more from my post on how to find arbs.
For an arbitrage bettor to capture the odds required for a risk free profit they also have to be well prepared. Ideally, the bookmaker and exchange accounts are logged in and ready to go, balance included.
The exchange is also very busy and competitive around the time of the arb, as other bettors are there for the same reason. Sometimes the bettor won’t get matched at the odds originally available. In the worst case scenario he Lays at a loss to reduce the risk.
Sports Arbitrage trading isn’t an activity for those who can’t resist a punt. It’s procedural, and gives little reason to be excited about the outcome of a sporting event [except the guaranteed profit]. Indeed the enjoyment of betting is somewhat removed. In effect, it’s a bit more like working.
4. Account Closures
Although arbing guarantees profits, it will certainly result in account closures for those that do enough of it. It may surprise some bettors to learn that bookmakers close new accounts in as little as one bet.
The decision to close an account is seldom overturned. Arbers are winners — and Bookmakers close winning accounts. As unfair as this sounds, it’s unfortunately true.
5. Terms & Conditions
Most bookmakers have terms & conditions permitting them to close accounts at their discretion if they suspect any form of advantage play from the customer. In addition, bookmakers usually explicitly stipulate that arbitrage betting programs used on their website are against terms and conditions.
Whilst the activity is most definitely not illegal, arbitrage betting leaves users open to several nuisances — such as payout disputes, stringent verification requirements, account locks, and unexpected telephone calls.
If the potential difficulties in arbitrage betting are throwing you off, then you might consider exploring other ways of earning online. Try my other post: How To Make Money Online (Earn At Home)
How Are Arbers Detected?
Arbers have several tell-tale traits that alert the Bookmaker to their activity.
1. Large Deposit and Stake Sizes
If a player signs up and instantly deposits a large sum of say £1,000, and he attempts to place the maximum stake on a selection then it’s likely to raise suspicion. Betting this much shortly after signing up isn’t the behaviour of someone dipping their toes in for the first time. And those sort of funds aren’t usually available to average punters. It smacks of someone who knows what they’re doing; so it’s an easy way for bookmakers to highlight potential arbers.
2. Peculiar Stake Amounts
Customers frequently betting on “marked” horses often have their maximum bet size capped, or other privileges revoked (e.g. BOG). In order to protect their business interests, stake restrictions are either imposed by automated risk parameters or set manually by the bookmaker. U
nfortunately for arbers these restrictions encourage unusual stakes e.g. £5.42. Average punters with full privileges tend to place flat, round stakes. A high frequency of non-round bets comes across as persistent, suggesting the use of a betting strategy or automated program.
3. Betting Patterns
For example, betting at antisocial hours of the day, or at unusually high odds.
Horse racing activity typically builds up around the time that races begin, which is around 2pm for most racedays. Those who wake up early in the morning to place bets are at risk of being flagged or monitored for value betting or arbing. Equally, a customer frequently betting at high odds demonstrates risk tolerance, or strategy; traits associated with risk free betting.
4. IP Address
If a customer comes from an area where groups of syndicates have been known to place value bets then the location alone could be an identifying factor.
IP addresses also make it easy to identify multi-accounting. Let’s suppose a customer was closed down for arbing, and then signed up his brother on another account using the same IP address. Whilst the bookmaker may not entirely discriminate against siblings of the same address, they will be aware that this household, or IP address, have a history of arbing.
5. Fraud Prevention Tools
Companies like Iovation, who provide fraud prevention tools, work closely with many online betting sites. As the Iovation website proudly states, this also prevents Arbitrage betting.
Whatever measures players take to disguise their arbitrage betting activity, bookmakers are still in the best position to recognise arb opportunities. Think about it: if professional bettors can build arb finding software, then so can the bookmakers. It’s not difficult for the bookmaker to note that a customer has started to frequently bet on their arbs. Regardless of what a player’s historic betting activity looks like, the conclusion will be: “this account is an arber”.
It’s these issues which make it difficult to create a longterm career from sports arbing.
I recommend learning more about arb detection from my post on avoiding account limits and closures. You may also find helpful arbitrage betting tips from an active arbing forum, or blog.
Is Arbing Legal?
Yes, Arbing is legal. Arbers simply pick off “good value” odds, that’s all.
Arbitrage Betting is discouraged by Bookmakers and it often breaks their terms & conditions — but this in itself isn’t illegal. Betfair and other exchanges actually encourage arbing activity as it provides a lot of liquidity to their betting markets.
To an extent, one may argue that arbing ‘evens out’ the somewhat uneven playing field between Punters and Bookies. What arbers do is [almost] the reverse of what a Bookmaker does. Arbers try to Back at good–value odds whilst Bookmakers look to Lay poor-value odds. Anyhow, regardless of arbing activity the Bookmaker should still earn a profit from their overround. My point being there’s no real harm done.
There are several arbing software applications designed to facilitate sports arbers. Unsurprisingly they aren’t endorsed by Bookmakers! But these products probably wouldn’t exist — at least not so publicly — if there were legal issues in arbing. Rebelbetting is the most well-known service. There’s still a huge amount of interest in the development of arb finders and tools from within the gambling community.
So, Is Arbing Worth The Effort?
There’s value in arbing — professionals and hobbyists both benefit from earning an easy, risk-free, tax-free income. So from a profitability point of view, yes, it’s well worth it.
There’s Certainly Some Drawbacks
If you really enjoy betting at specific Bookmakers then it makes little sense to run the risk of permanently losing your accounts over what could be a short-lived injection of only a small profit. Furthermore, you have to consider the time, dedication, effort and bankroll required to make arbing a success.
Plus arbing takes away an element of fun, right?… OK, maybe not. Making money is obviously more fun.
Good Software Makes Arbing Very Easy & Efficient
I’ve reviewed and recommended some excellent arb finders in my post What’s The Best Sports Arbing Software?
The mentioned products transform the concept of arbing into an attractive, profitable venture. They provide tons of value (to more than justify their fee) and considerably cut down the time and effort wasted in searching for arbs manually.
Rebelbetting is without any doubt the best, most professional service on the market. It’s fast, user-friendly and the most actively developed arbitrage solution today. If you sign up today then you’re entitled to a free trial period that turns into a monthly subscription at the end of the week — but it’s straightforward to cancel the subscription before then.
…On a final, sad note: my recommended Arbing software still can’t protect your betting accounts from inevitable closures!
If you’re totally new to Arbing then I suggest getting to grips with Matched Betting first. It’s also risk-free and the process is almost identical to Arbing. Start with my Matched Betting Tutorial.
I hope my guide to Arbitrage Betting has been informative. If you have any questions then feel free leave a comment at the bottom of this page.
Originally posted on 20 June 2016 and last updated 15 May 2018.
What’s The Best Sports Arbing Software?
Prevent Your Betting Accounts From Being Restricted Or Closed
Step-By-Step Beginners Guide To Matched Betting
The Best Matched Betting Services
How Do Bookmakers Earn? How Big Is Their Edge?
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Arbitrage betting seems a lot like parimutual in the states. It does look more effective and more profitable with a lot less risk though! I am surprised more people are betting this way!
Yeah I think what you’re talking about there is similar to our Tote betting. Arbitrage is certainly more lucrative 🙂 But taking on the Bookmakers does have its drawbacks, though.
at the end of the day… you can arb, make some money, get caught and have your accounts closed. Then you’ve still got Betfair to use anyway if you fancy a punt 😛
ballpark figures… how much would you make if you were to bet on let’s say 20 arbs every day at a bookie? and roughly how long would the account last for?
It depends on stake size. The amount you return is usually an average ROI on the amount placed. For example, that ROI may be 4% (realistic) – so if the sum of the total bets amounted to £100 then you would expect to make £4. Some arbs are worth more than others, though.
Do you know anything on different types of arbitrage bets? Dutches, middles, cross-market etc?
I do, and thanks for prompting me. I’ll create some more posts on complex arbitrage opportunities.
After reading articles including this one a few months ago I started arbitrage betting myself. I managed to have some solid success but avoiding getting limited by some of the bookmakers is difficult. I found that placing arbs that return more than 3-4% are not worth it despite the big returns. I used sites like http://arbcalculator.com/ or an excel spreadsheet to see what sort of profit I was making and if it high and on a site I thought I might get limited on I simply didn’t go through with it. This helped me keep my accounts running longer.
Yes – any profitable bettor will eventually experience limits/restrictions at the Bookies.
Most arbing software/finders also include similar calculators to help you out.
But then… if you place a lot of arbing bets, you will win and lose some at the same bookie.
Betfair was good exchange place 5-7 years ago, but now there are not many liquid markets except football and tennis. Pinnacle and sbobet are much better in arbitrage.
Great article, the concept is solid but you have some of the math wrong in the “CALCULATING GUARANTEED PROFIT FROM AN ARB” section. The final values are correct but some of the math along the way is wrong.
Thanks for letting me know! Looks like I made a couple of typos in there. In fact, I wrote that section so long ago that it felt as if I was reading it for the first time.
I must admit, it was pretty confusing. I’ve made it easier to follow now.
If the bookie decides to close your account, they don’t take the money from the account’s balance right?