The good book: How to bet better online

As bank interest rates tumble and savings rates drop to levels unheard of in most of our lifetimes, readers might be forgiven for looking at alternative ways to make their money work for them. Could online betting be the answer? Before we go any further here’s a health warning: this piece is about ways in which you can use the …

[Warren]

Fallacy

"If a friend was foolish enough to offer you odds of 50-to-1 on Gordon Brown winning the next election and the same odds on his losing, then you should bet at once."

Forgot the option that he might not be entered. Then he couldn't lose or win. Also forgot the option that friend may go bankrupt, etc. In these tough times even bookies can go bust.

Good article otherwise. Can't believe the number of people who place bets on the lottery and similar. "If you're going to bet on anything, bet on a certainty." I don't know if anyone's said that before.

[Anonymous Coward]

Some important notes

Good article with good basic odds information. It is very important to note that a good arbitrage opportunity does not come along that often, and when it does it doesn't stay around for long because the bookies adjust quickly to avoid these things. Remember the bookies are looking out for each other and will fleece you any chance they get.

Critically, you don't need to find just different odds with different bookies(those are everywhere), you need to find odds that are on the opposite side of the line. Also don't forget the margins. For example a moneyline in can be 105 or -105, never 100 (even). That is the way bookies make their profit. And arbs usually fall around the even line. You wont ever see a 200 on one bookie and -200 on the other. It doesn't happen. You will see 110 or 105 on one and -110 and -105 on the other though.

That brings up the question of volume. To make any worthwhile money in that fleeting instant of the divergence of the odds then you need some serious nerves to place a high bet on both sites instantly, and if you are placing a bet on one and meanwhile the other adjusts you have just lost your arb and now you are gambling.

There is "software" (read: malware) to take advantage of arb for you but would you trust it? I wouldn't.

[Anonymous Coward]

Wow

I've never seen such a long explanation of arbitrage before. You forget to mention that you need about £500 in each of the well known UK bookies and most of the European bookies to at least make it worth you while.

[Chris]

Good stuff

Good explanation. In fact many odds comparision websites list the betting percentage (ie the amount you need to stake to win 100%) for any event.

For the gold cup for example (a very liquid and well covered race) the percentage odds

http://odds.bestbetting.com/horse-racing/friday/cheltenham/3-20

are: Best price percentage: 100.1%, bookies only: 102.2% - which is unbelievably tight.

If you combine this with cashback from signing up for bookies, you can make arbitrage profits.

[Nathan]

Pitfalls are many

1.The bookie can cancel a bet siting "palpable error"

2. Rule differences can mean a winning bet is voided.

3. UK bookies only want mugs and will limit any knowledgeable punter to a max stake of pennies

4. Risk of error is high. All it takes is one misclick on a betting exchange to lose big!!

5. Risk of a bookie going bust with your money in there, never to be seen again.

[Britt Johnston]

sequel

Noe I see how honest bookies are, can you do a sequel on the stock market, please?

[Paul]

Debt of honour?

Err, aren't bets considered debts of honour and notoriously difficult to collect on default?

[John Pollard]

it can be done

Nathan has got some very good points there, he sounds like a man who has been there and done that. Spread betting is a great arena for arbitrage betting, but you'll need another article to explain the mechanics and the potentially much higher risks.

However, it can be done. I have turned profits of a 6 figure number (just!) in one year, though not just on arbitrage. But the points about bookies only wanting mugs is the big problem. I have had accounts closed and bets restricted. The biggest problem was that Spreadfair closed, the spread betting exchange (equivalent of Betfair) and now there is no spread betting exchange and punters are left to the mercy of the main players again (SI/IG/Spreadex).

[Stephen Hunt]

Kauto Star

Seems to do the trick...

[Frank Rizzo]

Arbing is not Forever

Arbitrage is a system itself and it is one which is not easy to make sustained profits online.

Bookies are not daft. They have beancounters actively looking out for arbers. In some instances you only have to have one winning bet to be classed as an arber with the result that your future bets will be severely restricted.

Forget online bets with bookies if you want to be a winner. Their programs are finely tuned to stop regular winners from winning whilst they quite generously accommodate mug punters.

Arbing on the exchanges is possible but not easy to get matched at the right time - there are far too many bots milliseconds in front of you.

The best way to make money is to find flaws in the odds themselves. If a bookie or exchange layer is offering 20/1 about an item you think has a 10/1 chance of winning and if your method is sound you can not fail to return a profit.

You can only do that online at an exchange or with cash bets though as those damn beancounters will start to restrict you if you win regularly.

[Marvin the Martian]

Why this essay?

Been on a friday afternoon wikipedia trawl?

[Kia Foster]

My boss.......

a long time ago, a Charles Ferraris who ran a Restaurant called the "Mad Hatter" , always said to

me that the only way to try and beat the Bookies was multiple bets, like Yankees, Super Yankees

etc ,as they hated multiple bets were they stand to gain little but stand to lose a lot. He is right. I did a £5 yankee ( 11 x £5 =£55) and got 3 winners and had about £6k running on last/4th

horse and that came 2nd a 1/2 length. If that had won at 5/1 back in 1979 they would have

been slaughtered. Best way, pick 4 horses and pay £11 for £1 Yankee and if you get 2 winners

you will at least recoup and if 3 then winning and 4 you can laugh all way to the Ban..... I mean matress.

[David Neil]

Couple of points

@ Warren

Obviously you make sure that the market you are betting on has clear rules about when bets become void - for a nice example of when this went very wrong, have a look on the Money Saving Expert forums for the crowd who managed to scrwe up the first goal scorer betting on Betfair

@ Paul

Gambling debts are now legally enforceable

[Ricky H]

spoons

great advice and I always thought it was possible to get better odds somehow:

using logic instead of emotion

"yer 'WE' are gunna win the game this weekend, aren't we LADS"

bookies are a working class relic :)

[James]

Successful betters/arbiters

Knowing a very(!) successful arbiter my self (not me I can't work that mental maths fast enough!) it is clear there is a lot of money swilling around on horse racing.

But people who constantly win are barred from bookies and my mate is no exception having been barred from most online bookies in the UK at least.

[Nick Kew]

One up, two down

Online betting is a mugs game. You have two chances to lose, but one to win.

Place your bet and lose - you lose.

Place your bet and win - you still bear the risk of counterparty default. And that's not idle theory: financial institutions are going bust at sufficient rate to make that a real risk. Who's to say the company you betted with won't be next?

[Another Anonymous Coward]

A better place to put online money...

...is Zopa. I've got a couple of grand in there at the moment and the 10% interest is very nice at a time when banks are offering nothing. Highly recommended (no, I don't work for them).

[Anonymous Coward]

An even better arb

An even better arb is to only bet one side of it. Imagine that one bookmaker consistently gives silly odds while another gives tight odds. Then in the long run you will make money by betting on the silly odds. It doesn't make consistent money like a normal arb but it will in the long run make you more if you can stand the short term volatility. It is also easier to bet only one side of an arb because you don't run the risk of odds changing while you try to make two bets.

[Anonymous Coward]

Looking into the future

"if you place money on the favourite early and back the non-favourites later, you should be able to create a position where you cannot lose."

But how do you know who the favourites are before they are favourites?

[Nick Miles]

debt of honour

Yep, that is correct in the UK at least. Gambling debts are not legally enforceable, so a Bookie can decide not to pay you if they want.

[TimB]

@Nick Miles

Not anymore. As of September 2007 gambling acts are legally enforcable.

[Vlad The Impugner]

How To Bolt After Door Shut

Arbitrage is never going to be a long term profitable prospect. Systems such as BetRadar (and the more improved systems) will look for them on behalf of the traders.

It's easier to take advantage of gullible amateurs especially during in-running betting than it is to find a bookie's flaw.

I'm not saying the bookie's bet traders are perfect, they do miss stuff, and purposefully offer generous odds to get new punters signed up with them. But as more people look to exploit, the arbs will get less and less.

Although curiously I expect there to be some arb opportunities on multi bets for obvious reasons.