The ultimate guide for the sharp bettor

What is Hedging Bets in Sports Betting?

Hedging Bets Ever think about playing both sides to come out on top? You can. Find out more about hedge bets and how they work through this helpful in-depth guide.
Uno July
Author:
Uno July
Updated:
13 October 2021
Table of Contents

    What Is Bet Hedging?

    In the simplest terms, hedge betting entails betting on the opposite side of an existing wager you already made. It’s almost akin to betting the middle or fading the public in a sense, except in this context, the only person you’re being contrarian towards is yourself. 

    With enough luck, insight, and smart caution exercised, this can be a great strategy to offset risks, create almost guaranteed returns, and come out on top by playing both sides of the equation. 

    If you don’t know where to start, how to start, or why you should start, then keep reading for an in-depth overview of betting the hedge. 

    How Does Hedging Bets Work?

    As stated above, hedge bets can make for a great risk reduction strategy for minimizing losses and retaining profits, but what does it take for them to guarantee a profit? In order for that to happen, at least one of these two conditions must be true:

    The odds must have drifted following the first lay bet
    The odds must have shortened following the first back bet

    To ensure a better likelihood of these two conditions happening, bettors should follow line movement trends as precisely as they can, especially if they’re participating in a sportsbook’s live, real-time in-game betting service. 

    Remember the Third Law of Thermodynamics: the entropy of any given isolated system in the universe is always set to increase. Oddsmakers and professional bettors are great at doing all sorts of complicated guesswork when trying to predict the most likely implied probability of a game, but the reality is that no one can really know with 100% certainty what exactly the future holds. 

    All sorts of random variables can dictate the likelihood of whether or not certain outcomes will come to fruition, which just makes hedging bets (provided you’re comfortable with the risk of those bets) all the wiser a decision. To calculate hedge bet outcomes, you’re going to need to know the following things:

    The back or lay of your initial wager
    The original stake and decimal odds you bet with
    The opposing odds of your first selection + hedge stake amount
    The commission of your exchange, if betting through one

    Once you punch all of these things into a calculator (which you can do via online tools like this one), you can then get a better grasp on the odds needed to guarantee that your bet turns a profit. As far as calculating some other variables in relation to hedge bets, here are some really useful mathematical pointers to know, should you choose to hedge through a betting exchange:

    When calculating a lay bet: Multiply the back price and back stake, then divide that result by the current lay odds.

    When calculating the profit of a back-to-lay hedge bet: Multiply the back stake by the back odds, then subtract the result by the lay liability and back stake.

    When calculating the total overall return of a winning lay bet: Subtract the lay stake from the backers’ stake.

    Hedging through a better exchange rather than a traditional sportsbook might offer even more risk reduction than hedge bets already do, as they generally charge bettors less and impose less betting limits on them. Nevertheless, there’s not really a “better” way to approach hedge betting; what’s better for you will ultimately come down to personal preference.

    When To Hedge A Bet

    This is a tough question, and not necessarily one that has a single definitive right or wrong answer. Generally speaking, the answer to this question will depend on how much you’re comfortable risking, and how confident you are about your wager being more probable than the odds currently listed on the line.

    Don’t forget about that Third Law either: all sorts of conflicting situational variables can affect the odds and throw them drastically off from the odds currently being listed to you. This is particularly important in the case of hedging live in-game bets, as all sorts of line movements and prop wagers could be hanging in the balance.

    So before hedging any bet, you should have the utmost confidence that the situation you’re wagering on is more likely to occur than not. 

    Bet Hedging: Pros & Cons

    Bet hedging, like any type of gamble, presents its own unique set of risks and rewards. Here’s a run-through of each:

    Pros

    It’s an almost win-win scenario if you strike luck
    You can almost certainly guarantee turning a small profit
    You can exploit betting opportunities emerging in-game
    It’s an all-around great strategy to mitigate risk

    Cons

    Hedging online movements can backfire if you’re not careful
    You might need a bigger first outlay, costing more than retaining
    You have to wait for these opportunities to arise organically
    The other side may have too much home-field advantage
    Saving profit may lead to sacrificing some profit

    In the best legal markets (which are only bound to expand with time), bettors have the freedom to enjoy a plethora of the industry’s best online sportsbooks, notable acclaimed names such as:

    Caesars Sportsbook

    FanDuel Sportsbook

    PointsBet Sportsbook

    BetMGM Sportsbook

    BetRivers

    WynnBet

    Unibet Sportsbook

    Fubo Sportsbook

    Golden Nugget Online

    Borgata Sportsbook

    DraftKings Sportsbook

    888 Sport

    Sugarhouse Casino

    Fox Bet Sportsbook

    BetAmerica Sportsbook

    Tipico Sportsbook

    The Score Sportsbook

    SI Sportsbook

    Betway

    Betfred Sports

    Bet365


    Currently, Washington D.C. and over 14 states offer legalized online sports betting markets in the United States. As of writing this, those states include:


    Although betting exchange markets have lagged behind in the U.S. due to industry pleasure and legal issues, the tide is slowly beginning to turn on that front, as exchanges like Prophet and Sporttrade are set to open exchange betting markets by the end of this year.

    For updates on that, where else to hedge bets, and other exciting news in the iGaming industry, we strongly encourage you to keep in touch with us.

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