Online Gambling Arbitrage Betting
Gambling is, in essence, an activity that involves a certain level of risk. Different forms of gambling involve different levels of risk, but they almost all involve risk of some kind. Except that is, for arbitrage. Arbitrage is a form of "no risk" gambling or a type of gambling in which you can't lose, no matter what happens. Opportunities for arbitrage are few and far between, however, and when they do occur they don't always create a very high reward. That being said, arbitrage is one of the few forms of "no risk" gambling that is both legal and also not even frowned upon by casinos. Here is an overview of online gambling arbitrage betting; what it is, how it is accomplished and why it is not illegal or even frowned upon by casinos.
What is Arbitrage Betting?
Arbitrage is a common practice in economics and finance, where brokers take advantage of price differences between markets. It is, in essence, engaging in arbitrage means to "bet" on both sides so that you come out ahead no matter which way the price moves. In sports gambling, arbitrage can happen any time a competition happens between two competitors, in which there is a single winner and single loser. In sports betting, arbitrage bettors take advantage of differences in odds offered between casinos. Arbitrage is a way of coming out ahead financially regardless of which team (or individual) wins or oses. While many tournaments, matches or games may have very similar odds, there are a number of instances in which casinos offer various odds for different reasons. When there is a wide discrepancy between the odds offered by one casino and another, this provides the perfect opportunity for arbitrage.
Arbitrage Betting Example
If the odds for player A winning are 1.360 with one casino, and you bet $801.75 then your earnings if player A wins would be $1,090.38. If the odds against them (odds of player B winning) with another bookmaker are 5.500 and you bet $198.25 on them winning, then if they win your earnings would be the same: $1,090.38. In this case, because of the discrepancies in the odds, it doesn't matter which player wins or loses, you still win. By placing $1,000 in bets, you net a $98 profit no matter who wins or loses, which increases your stake by 9.8%.
How Does Arbitrage Betting Occur?
Not every match or event is going to present the right circumstances for arbitrage. In most sporting events, the odds are first set by major casinos who run the largest operations. They often have several avenues of inside information that allows them to keep their fingers on the pulse of every type of event. Once the odds are set by the major players, the smaller houses simply set their odds based on the major players. This leads to a relative uniformity of odds between casinos. In some cases, however, one major player may have information another does not have, or interpret certain events very differently, which leads to a major discrepancy in the odds that each one offers. This discrepancy is what creates the right circumstances for arbitrage.
Another scenario that creates the right conditions for arbitrage is if one casino accepts an extremely large bet. Casinos and bookmakers make money and limit their risk by balancing their books. The goal is to ensure that no matter who wins or loses, they keep more in lost bets than they have to pay out in winnings. When they take in an exceptionally large bet, they sometimes have to tweak the odds to encourage more bettors on the other side. This will create a discrepancy between the odds they are offering and the odds other casinos are offering, which creates the right environment for arbitrage.
Why is Arbitrage Betting Legal?
There are many practices that are technically legal but are still frowned upon by gambling establishments. Arbitrage is not one of them. In truth, even if casinos frowned on the practice, it would be very difficult to detect because conflicting bets are always placed with different casinos. Arbitrage is neither illegal nor frowned upon, however, because it doesn't represent any type of threat to the house. Both bets are being placed legally, lawfully and even within the "spirit" of good conduct. One of many reasons for this is that arbitrage conditions occur fairly rarely and when they do, they generally only result in relatively small winnings of 10% or less. That being said, arbitrage makes a great side gig and can even be quite lucrative as a full-time endeavor.
Conversely, however, online gambling arbitrage betting is difficult in the U.S. While there are more than 2.200 registered online casinos, most Americans only have access to a small fraction of those thanks to federal laws against online gambling. While it is still technically illegal, there are a few online sites that open their doors to American gamblers. Unfortunately, the fewer sites you are able to access, the less likely it is that you will be able to turn online gambling arbitrage betting into a full-time occupation. While arbitrage can pay off handsomely if you find exactly the right conditions, finding those conditions can be time-consuming and quite a chore in and of itself.
That being said, having access to only a few online casinos can actually be something of a benefit in some way. For one thing, there are thousands of sporting events happening all over the world at any given time and the odds are constantly in flux. Citizens of other countries that have access to over 2,000 different sites also have that many sites to monitor to try and find the right conditions for arbitrage. Simply having to monitor that many sites mean they may actually miss out on golden opportunities because they were looking at the wrong site at the time an opportunity presented itself. By having fewer sites to monitor, American gamblers might find just as many opportunities.
iovation is a leading provider of fraud prevention and detection solutions as well as advanced multifactor authentication software for online banking, e-commerce, insurance, online gambling, online communities, and travel and ticketing organizations.
Ready for the next step?
Spot user behaviors and device information that’s suspicious, and stop those fraudsters in real time. We track billions of devices and our fraud analysts add evidence to make this intelligence even more effective.