# Arbitrage betting – Minimum risk investment

Most people who make sports bets are amateurs and they only bet for fun. However, there are also a lot of people who dedicate a lot of time and effort to sports bet and they earn their living solely out of bets. Aside from a lot of sports knowledge and a good intuition, these people also have a very good understanding on investments. There are a lot of investment concepts which can apply to betting systems. For example arbitrage betting is a betting strategy that allows you to make a positive return of your money by taking very small risks. One might say that risks are the main characteristics of sports bets but if you know how to work the system, you can considerably minimize your risks.

Arbitrage betting – Minimum risk investment Picture
• Understanding arbitrage betting

In order to be able to minimize your risks in a bet you need to look for favorable betting situations. In order to find these situations, you must work with several betting agencies and websites. Lets assume that there is an upcoming game between two strong teams. You can make your research and do a single bet on the team which you think is better. However, if you compare the odds of different online betting agencies, you might find a situation which is favorable for arbitrage betting. For example, lets assume that one website lists Team A at 2.00 and another website lists Team B at 2.20. In this situation all you have to do is bet \$523,81 on Team A on the first website and bet \$476,19 on Team B on the second website. If team A wins you will make \$1047.62. You deduct the \$523,81 and the \$476,19 and you will have a profit of \$47. If team B wins, you will make 1.047,61 which will also leave you with a \$47 profit. This is a perfect arbitrage situation where you are taking absolutely no risks.

• How do profitable situations appear?

Bookmakers use a lot of data as well as sophisticated data processing software in order to calculate their odds. However, each bookie has a different opinion on the relevance of certain information. Therefore, it is not uncommon for bookies to launch different odds for the same game. If they are getting a lot of bets on one team they have to rise the odds of the other team in order to balance their risks. These situations can also appear when a vital sports information appears. For example, if certain key players will be unable to participate in a game, the odds of the game will change. Favorable situations also occur when bookies are too slow in reacting to new information.

• How do you exploit the arbitrage situations

A beginner better who read about arbitrage betting may be under the impression that he hit a gold mine and he will get rich over night. Despite the fact that arbitrage situations are quite often, they do need to be carefully calculated. In the situation presented above the better is willing to bet \$1000 which he splits in two bets, one for each team. In order to know how much money to bet on each team, he divides his total amount of money by the average of the two odds. The result of this division is the money which he bets on the team with the higher odds and he bets the rest of the money on the team with the smaller odds.