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What is hedge betting?

Hedge betting is a betting strategy that takes advantage of fluctuations in betting odds to establish an opportunity for profitable betting.

As betting odds fluctuate, it is possible to back a team at higher odds then bet against them with a lay bet when odds change. That way, if your team wins or loses, you will profit regardless.

It’s a strategy that is often used during in-play betting, because odds change as the match proceeds. The key to successful hedge betting is predicting how the market will move as circumstances change. It’s like buying stock on the stock market and profiting by buying low, then selling high.

Hedge betting example

Your AFL team might have good odds four days out from the game. Then, as the match draws nearer, a key player is ruled out with injury and the odds lengthen. If you backed the team at good odds, then placed a lay bet at narrower odds a few days later, you have a solid outcome regardless of the result of the match.

Or, in a golf tournament, you may back a player on day one, then place a lay bet if the player performs poorly than expected on day two.

Hedge betting strategy

Mastering hedge betting requires advance planning and good sporting knowledge. Using an example of the Australian Open tennis tournament, we can explain the strategy in more detail.

Let’s say Daria Gavrilova, who’s not previously made the quarters at the Australian Open, has odds of 18.00 to win the tournament. But you think she’s well prepared, in form and capable of making the final. So you place a $10.00 bet on her winning at 18.00.

Gavrilova causes a few upsets and cruises through the tournament and makes the final against Serena Williams. The odds of the highly experienced Williams to win are 1.85.

The ideal hedge betting scenario is achieving a balanced return regardless of the outcome.

In this case, you divide the return of the initial bet by the price of the opposite outcome, to calculate how much you should bet on Williams to secure guaranteed profits.

Your original bet on Gavrilova of $10.00 at 18.00 yields a return of $170.

By using a hedge betting calculator you can determine what to bet on Williams to guarantee the same return. You increase your total outlay, but the investment is worthwhile when you know your bet is a sure thing.

Pros and cons of hedge betting:

ProsCons
By finding a win-win scenario you are eliminating any riskThe market can move against you, leaving you exposed
You can secure guaranteed profits, regardless of the outcomeYou must spend time looking for hedge betting opportunities
You can capitalise on your sporting knowledge to find valuable betting opportunitiesYou may be reliant on an outsider to create an upset
You don’t need to place bets with different betting agenciesYou require a larger initial outlay to make multiple bets
It can be used to reduce your exposure if you place a bet you later regretYou need to sacrifice potential profit in order to reduce risk