If I told you there was a way to win every sports bet no matter the outcome, you’d be rightfully suspicious. However, there is a way to pull that off. Bettors can game sportsbooks to profit no matter which team wins.
But bettors do so at their own risk. Sportsbooks do not appreciate their users gaming the system. It undermines sportsbooks’ profitability and breaks the foundations that sports betting is built upon. It’s a great deal for bettors, but it’s a raw deal for sportsbooks. So, sportsbooks that catch bettors pulling this trick will suspend offending bettors’ accounts.
The trick is called arbitrage betting. It can make sports bettors a lot of money, but it risks their sportsbook accounts. Here’s why it’s tempting to bettors and why sportsbooks hate it so vehemently.
What Is Arbitrage Betting?
Arbitrage betting is betting at two different sportsbooks to exploit odds differences that give bettors their own house advantage. Normally, when a sportsbook’s odds are converted to probabilities, they add up to more than 100%. That’s because sportsbooks don’t offer fair odds. They build a small “house advantage” into every line. In fact, we’ve written about the tradeoff sportsbooks make between offering competitive odds and profiting off each line. The better odds sportsbooks offer, the less they profit from those odds.
But arbitrage betting finds odds that add up to less than 100%. When the probabilities add up to less than 100%, bettors can profit no matter what. The sportsbooks give money up when that happens. So, bettors won’t be able to find odds like this at most sportsbooks. (SBK has odds that add up to less than 100%, but SBK generates revenue differently than most sportsbooks.) That’s why arbitrage bettors have to compare different sportsbooks. A single sportsbook would (almost) never make that mistake.
However, other sportsbooks know about this trick, too. Their oddsmakers know the market well enough to prevent it. If bettors compare most sportsbook odds, then they won’t find probabilities that allow bettors to successfully do arbitrage betting. If bettors always win, then sportsbooks lose money over time. It drains the sportsbook industry of revenue, even if only a few sportsbooks are affected at a time. Arbitrage betting is even worse for illegal bookies, who suffer financially as individuals. (Which was the point of legalizing sports betting in many states.)
The bottom line is that arbitrage betting is bad for sportsbooks. But it’s surprisingly easy to catch bettors doing it.
How Arbitrage Betting Works
If bettors find odds on both sides of the line at two different sportsbooks that add up to less than 100%, they still have their work cut out for them. They have to wager specific amounts on both sides of the line to guarantee a profit. Here’s a fictional moneyline to start with:
|Sportsbook 1||Sportsbook 2|
If you add the probabilities of both sportsbooks, they add up to 95.3%. This would be a prime candidate for an arbitrage bet. Remember, bettors have to find odds on opposite sides of the line at two different sportsbooks for this to work.
Once arbitrage bettors find a line, they have to decide how much to wager. Arbitrage bettors split their wager between both lines. So, if arbitrage bettors want to bet $100, they’ll split that $100 between both sides of the line. And they’ll do so in such a way that no matter who wins, they profit. Here’s how that looks with a $100 wager:
|Sportsbook 1||Sportsbook 2|
In this example, no matter which side wins, the bettor gets $105 on a $100 bet. If bettors want to figure out how this works, they can either:
- Do the math by hand
- Google an arbitrage calculator
Many websites have an online arbitrage betting calculator that figures out how to split a wager to profit from sports betting no matter what. It’s the preferred method of arbitrage bettors and sports journalists alike.
How Sportsbooks Catch Arbitrage Bettors
In the example above, we used clean numbers to make the point. But if we bump the odds by five points, we see a more realistic picture of an arbitrage bet:
|Sportsbook 1||Sportsbook 2|
These aren’t pretty numbers that end in fives and zeros. They’re specific amounts of money that split $100 into two lines. Sportsbooks view wagers whose amounts are specific down to the cent with suspicion. They know how arbitrage betting works. They also know that letting arbitrage bettors roam free is bad for them. If PointsBet lets arbitrage bettors wager at FanDuel, it’ll be a matter of time until arbitrage bettors chip away at PointsBet’s profits. Specific wager amounts like the ones above are the easiest ways to catch arbitrage bettors – and shut their accounts down.
A Warning For Arbitrage Bettors
So we’ve just about beaten the “arbitrage bettors are bad for sportsbooks” argument to death. But there’s one more warning we feel we must leave potential sports bettors with. It’s not that arbitrage betting may get your account suspended – even though that’s true. It’s that arbitrage betting is not lucrative.
Take our clean easy example, with the -200 and +250 odds. You’d have to wager $100 to win $5. But think about how much you’d have to wager to win $100 instead. With those odds, bettors would have to wager $2,000 to win $100. Depending on sports betting quirks – and occasionally, sportsbooks’ mistakes – is a poor business model. Profit margins are low and arbitrage betting opportunities appear inconsistently.
Risking money in an all-or-nothing wager may make some bettors’ skin crawl. But risking an entire sportsbook account to avoid sports betting risk is ridiculous. It’s better not to wager at a sportsbook than to risk your account to avoid losing money. Don’t bet more than you’re willing to lose and bet honestly. It’s better than becoming steadily blacklisted across the sports betting industry.