How to Calculate NFL Arbitrage Bets
Arbitrage betting is perhaps the most sought after form of sports betting. It is so alluring to punters because it minimizes risk a lot more than other types of betting. Arbitrage betting means betting on all possible outcomes at the same time, thus guaranteeing yourself a win one way or another.
You may wonder why sports bettors are not applying this technique constantly – well, because it is not possible. Arbitrage betting is only possible every once in a while and punters need to be very careful not to miss that opportunity. Once it arises, you need to know how to calculate your bets.
NFL Arbitrage Betting
Arbitrage betting occurs when the odds are favorable for all outcomes of a certain event. This is most commonly a binary bet with only two possible outcomes. That is so because it is easier to cover only two separate possibilities than any larger number.
For this type of betting to be available to you, you will most certainly need to have an account at more than one online sportsbook. If you try arbitrage betting at the same sportsbook, then you will most likely get banned. This technique is generally frowned upon by bookies and it is highly unlikely that you find the right odds for arbitrage betting without visiting multiple sportsbooks.
Of course, there are some sportsbooks that allow multiple bets on the same matchup. However, they are quite rare nowadays. Additionally, this way you will be fully reliant on the fluctuation of odds and might have only a few seconds to place your bet. You will most likely have a better chance if you look at multiple sportsbooks.
Calculating NFL Arbitrage Bets
To calculate the right amount to arb on the NFL, you will need to first calculate the implied probability of all possible outcomes. Then, you need to calculate the sum of the probabilities of all possible outcomes. Finally, you need to divide the implied probability of each outcome by the sum of all probabilities, individually.
So, since this might be a little hard to understand without an illustration, let us give an example to clarify. Say, the Patriots are playing the Colts. The odds for the Colts are 1.20 at one sportsbook. The implied probability is 1/1.20 which equals 0.833. We then need to multiply this number by 100 to get the implied probability which in this case would be 83.3%.
The odds for the Patriots, on the other hand, are 8.00. We apply the same equation and get the number 12.5% which is the implied probability. Now, to get the market total we need to do some simple addition: 83.3% + 12.5% = 95.8%.
Now, in order to calculate how big your bets should be we need to divide the individual implied probabilities by the market total and then multiply that by 100. So, for the Colts you get (83.3%/95.8%)x100 = 86.952%. Then, for the Patriots the equation would be: (12.5%/95.8%)x100 = 13.048%.
Let us say the overall amount you wish to bet is $100. All you need to do is multiply that number by each figure to get the size of each bet you should place. So, for the Colts – 100×86.95% = 86.95 and for the Patriots – 100×13.05% = 13.05. This way, regardless of who wins, you stand to make a profit of roughly $4.40. We will go into more detail as to how to calculate your profits in the next section. Now, we will go over another way to make arbitrage bets.
When there is no large discrepancy between the same-event odds of one bookie and another you might want to consider betting exchanges. The odds for them are different and they give NFL lovers the opportunity to back or buy the outcome, the opposite being to lay or sell it. However, this type of bet is charged a commission fee by the bookie.
So, the formula to calculate the size of the bet you should place goes like this – (lay price x back wager) / (value of the current lay odds – the commission). Please keep in mind that the commission should not be above 5%.
Calculating NFL Arbitrage Profits
Calculating your guaranteed profit is just as important as calculating your NFL arbitrage bets. Naturally, you will have to do some more math to get a figure. First, you need to take your individual stake and multiply it by the odds. Then, you need to deduct your total stake and you will have a number that expresses your guaranteed profit. Let us illustrate this by using the previous example.
If the Colts win, we collect ($86.95×1.20 =) $104.34. After we remove our $100 stake, we get our $4.34 guaranteed profit. On the other hand, if the Patriots win, we collect ($13.05×8.00) = $104.38. Then, once again, we deduct our $100 stake and we get our $4.38 guaranteed profit.
As you can see, the profits from arbitrage betting are not big but they are certain. When it comes to all forms of gambling, profits are never guaranteed, so this is why arbitrage betting is so highly sought after. It accomplishes the impossible and guarantees you a win every time.
What Makes Arbitrage Betting Possible
The large variations between betting markets of different sportsbooks make this form of betting possible. They are quite hard to find though, as we already mentioned. This is because there are rarely such large differences between the odds on one event, regardless of how many sportsbooks you look at. Bookies are usually in agreeance and while you can find odds that are slightly better or slightly worse, the opportunity to make an arbitrage bet quite rarely arises.
The companies that are responsible for making the odds and lines of a given event usually have the same idea about how things will progress. However, sometimes they do not agree and that is when discrepancies occur. When a large enough discrepancy occurs players will be able to make NFL arbitrage bets.
There are other factors that concern the odds and lines though – for instance, if too many stakes are placed on one outcome, the bookies might shift the odds and lines. If this happens in a dramatic enough fashion, it will also give players the opportunity to place arbitrage bets.
Positives and Negatives of Arbitrage Betting
In a way, arbitrage betting is a tool to minimize risk when betting on the NFL. After all, punters are ensuring a win, instead of betting on only one possible outcome and standing to lose their whole stake if things go south. Having a sure win instead of a potential loss looming over your head is definitely a positive.
Having the chance to make an arbitrage bet is a great opportunity to challenge your skills as a sports bettor. This type of bet is not simple and takes more than most players have. It will definitely influence your level for the better.
However, the opportunities for an arbitrage bet are quite rare, even if you decide to make a bet exchange. Most often, you will find odds that are far too similar to hold any real value. To find these opportunities you need to be constantly vigilant and act immediately as they disappear momentarily.
It can be quite hard to act quickly when the chance arises and sometimes you might see the opportunity and simply not react on time. By the time you have finished your calculations, the odds will probably already be unfit for an arbitrage bet.
Additionally, while the profit from this type of bet is certain, it is also small. In fact, a return of more than 3% is a rarity. This means that this is definitely not a get-rich-quick scheme and you cannot really make substantial profits.
So, the opportunity to make an arbitrage bet rarely arises. Even if it does, the profits will most likely be under 3% on your overall investment. However, this is a way to guarantee yourself a win, regardless of the outcome of a situation.
This is a way to minimize risk and remove the chance of losing altogether. So, despite the fact that such opportunities are hard to find, if you happen to find them, you should give arbitrage betting a try. You will need to be quick and calculate the right amount to bet almost immediately. Make sure to bet responsibly!