It’s possible that you have heard of the phrase ‘hedge your bets’ being thrown around. And for most of us, this is simply a passing turn of phrase that crops up occasionally in conversation. However, hedge betting is an actual activity that you can participate in. And as it happens, it can be quite a beneficial betting strategy to make use of as well. If you’re looking to get involved in such, then there are certain things you need to know about it before doing so. Let’s take a closer look at what hedge betting is and what you need to know to get started.
What Is Hedge Betting?
Hedge betting essentially sees a bettor place two bets on the same betting market, so as to take advantage of the movement in odds. Generally speaking, the easiest way that most users of this strategy utilize it is by going through a betting exchange. Betfair has a great exchange to use and so does Smarkets. Through exchanges, you can place lay bets, so you would essentially be betting that something doesn’t happen in this instance.
Backing for higher odds and laying for lower odds is where you can make some nice profit with hedge betting. To look at it in another way, you could consider it as a sort of insurance strategy. Through successful hedge betting, you have no worries over whether you will receive a payout from your wagers. If you have no qualms about taking a lesser payout from a proper hedge bet, then it can negate the possibility of losing overall.
At the same time, hedge betting acts as an outright way of cutting any losses. Sometimes, you can place bad bets or at times, the odds do not work in your favour as expected. Obviously, losing at times is all part of being a sports bettor. Even the professionals don’t get it right every single time. However, what we would sooner do is not lose our whole stake, and if that is something we can avoid, so be it. Hedge betting is what allows you to do this. Learning this system and executing it properly is a great skill to acquire.
A number of betting operators are currently looking into opening betting exchanges, as this is essentially a niche to be taken. There are just several well-known exchanges and this is an especially good opportunity for smaller region-specific brands. Some examples of operators, who are seriously considering entering the exchange niche are Melbet Nigeria and Booster99.
How to Proceed with Hedging Your Bets?
One thing that you need to consider when hedging your bets is that it’s a versatile enough strategy to utilise. Sometimes, it can be a matter of needing to hedge your bets straight away, while with others, it could take weeks or months before you decide to do so. In-play betting or long-term market bets will determine this.
Outright Market Hedging
Betting on an outright market is when a bookie will take bets on the outcome of competitions or tournaments rather than individual events. Of course, the most common bet of this kind is to wager on the outright winner. However, many markets exist within this, such as highest goal scorers or teams with most draws etc.
The outright market is usually the first bet to be offered and this runs throughout the event itself. So, for example, if you intend to bet on the winner of the Premier League, this would be outright. Let us use an example in this instance.
For argument’s sake, let’s say that Manchester United is the hot favourite to win the Premier League, but Everton are coming up close. A sportsbook is offering 1.67 odds on United and 2.4 on Everton, and we have $50 to wager on the event. Should Everton go on to actually win, we would receive $70 in profit, equating to $120 altogether alongside the returned bet. Of course, the Premier League is not a tournament that takes place in a couple of events. It runs over 10 months altogether.
In our example, Man Utd and Everton are performing well as the season comes into its final few months. Everton have managed to secure a six-point lead over the second-placed Manchester United. Towards the end of the season is always when the crunch point occurs. Man Utd has a better team when it comes to the endurance factor, though. So, although Everton still stands a good chance of winning, and thereby providing us with the $120 reward, it’s not signed, sealed and delivered. Obviously, there could be a lower level of confidence in the team by now.
As a hedge bettor, we choose to take a look at the odds now that the competition is nearing its end. An exchange may be listing lay bets against Everton at 1.25. Using a hedging calculator, certain information can be entered, like the bet amount, back odds, lay odds and so on. The result of that calculation determines that a $100 lay bet on Everton would see us stand to win $45 whether the team wins or not. Using the exchange, we have placed the lay bet in these circumstances.
Essentially, we have wagered on Everton both to win and not to win, and by using the odds movements and an altered stake, we get a win regardless of the outcome in the end. It is always imperative to remember that the back odds are high and the lay odds a lot lower to be in profit.
A similar hedging bets strategy can be used when it comes to live betting as well. Of course, you have to be a lot quicker off the ball with this, as the games are playing out as you’re doing it. This is where exchanges really come into effect. Just be sure to watch for the changing of the back and lay odds, as stated earlier.
In-play betting can be something that is much more capable for seasoned bettors to engage in due to the speed in which you need to execute your wagers.
Tips and Tricks for Hedge Betting
There are a few key points to remember when hedge betting. Always be certain that you weigh up the risk and reward factors. Don’t be too cautious, as you can end up taking money away from the potential profit this way. Utilize it as a sort of back-up to standard sports betting.
Of course, it may seem like you need to be in-the-know of which team will win with standard sports betting. Hedge betting cancels this theory out, as regardless of the outcome in the end, a successful hedge bet will provide you with profit. As long as you can get a feel for which way the bookie’s odds are going to move, you can utilize the hedge betting strategy to obtain profit.