Betting is all about risks, and sports betting is about risk, unpredictability, and more risk! However, this does not mean you are destined to lose or never get a profit out of your favorite sports bets. There are ways and strategies to minimize the risk involved in sports betting. Today, I am here to uncover one of the most advanced techniques pro sports bettors use to reduce the risk of their wager or secure some profit.
Stay with me until the end to learn what hedge betting is, when, and how to use it.
What Is The Meaning Of?
In general, hedging means minimizing the casualties! In other words, when you hedge a situation, you minimize your exposure to unpleasant outcomes. We can use hedging in our everyday life. Similarly, in sports betting, bettors use hedging to reduce the risks of their wager or guarantee some profit out of it.
Hedging a bet is an advanced sports betting strategy in which you place a second wager against your original one because you are unsure whether or not the outcome will be a win. Although your win from hedge betting will not be that much, it allows you to walk away with some money or at least less loss!
As a sports bettor, you can use hedging against any wager, say, point spread, futures, or Moneyline. However, there is something to remember here, which is sportsbooks vig(vigorish or commission). To place a hedge bet against your original wager, you should pay another vig to the bookmaker, which decreases your expected earnings.
How To Hedge A Bet
Hedging a bet is pretty straightforward, and simplicity is the main reason behind its widespread use among sports bettors, pros and newbies. However, the ease of practice should not fool you because the method can easily be misunderstood and confused with the arbitrage sports betting system(more on this later).
To hedge a bet, you place another bet against your already active bet to guarantee a profit regardless of the outcome or minimize your risk. The most common betting market where hedging is profitable is future betting. Let me further explain the concept using an example.
Hedging A Bet Example
Suppose you place a future bet at +1000 odds on the Houston Cougars men’s basketball team winning the NCAA tournament($10 to win $100). In early April, Houston made it to the final four teams. This is good news that says your +1000 bet is not at risk because that price no longer exists in the market. Now, the bookmaker would list Houston’s odds of winning the tournament at something like +180. In this case, you have two options: hedge or let your bet remain as it is. If you take the first option, you should bet on the outcome of Houston not winning the tournament. In this case, the bookmaker would list the odds of Houston not winning at -250, which means you should risk $250 to win $100(or risk $25 to win $10). Hedging allows you to secure some profit regardless of the outcome. However, it will reduce your potential earnings on Houston winning the tournament. Here are two scenarios for either case(hedging or not hedging):
|You Do Not Hedge(bet $10 to win $100 on Houston winning the tournament)|
|If Houston wins||You win $100 + your initial bet|
|If Houston loses||You lose $10|
|You Hedge( bet $50 to win $20 on Houston not winning the tournament)|
|If Houston wins||You win $50(+100- $50)|
|If Houston loses||You win $10 (-$10 +$20)|
When And Why Bettors Should Hedge Their Bets?
The question does not have a short answer. Because it depends on the situation, your bankroll, your ability to make the right mathematical decisions, and the amount you already risked for your initial bet. Knowing when and why you should hedge a bet is vital and determines your overall win or loss. For this reason, we summarized every scenario to help you better figure out when and why to hedge your bet.
Hedge your bet to secure a profit
The primary reason for hedging your bet is to guarantee some profit. So, you hedge(bet the opposite outcome) your initial wager when the chances of your winning have decreased. However, you still doubt whether the outcome would be a loss. In other words, you place a hedge bet to cover your initial wager with minimum cash.
Hedge if you changed your mind OR there are changes in the game
You may change your mind during a game because your team is not playing up to your expectations. Also, the outcome of a game dramatically changes due to the weather, the injury of a star player, a player being red-carded, etc. As a result, your initial bet outcome changes accordingly. In such situations, you can hedge to prevent unpleasant outcomes and significant losses due to unexpected changes in the game.
Hedging an In-play bet
In-play betting is fun but riskier. Because you are placing your wager in real-time, changes happen quickly, and you need to decide as fast as the game progresses. In-play hedging allows you to cover your losses in cases where your initial bet is affected due to unexpected events, like a player injury.
Futures/outright bets are the best to hedge
As mentioned earlier, the future market is the most common for hedge betting because of its favorable and considerable odds. In this market, you are primarily betting on an outright winner of an upcoming major event. For example, you bet on the Super Bowl LVll 2023 champion. Hedging future bets is very common due to the high risk and profit involved.
Parlay bets hedging
Parlay tickets are accumulator bets in which you bet on the outcome of multiple matches in one ticket. You need all your legs(outcomes) to win for your parlay to win. The more outcomes you add to your ticket, the riskier and more profitable it will be. Hence, hedging your last leg(bet), especially when you get the initial legs correct, can significantly increase your earnings from a parlay ticket.
What You Should Know Before Hedging A Bet
Although the process is not complicated, you should hedge a bet with your eyes wide open. Below are some tips to help you approach this sports betting strategy more confidently and easily.
Make sure your bets are well balanced
You must balance your hedge bet to minimize your loss, make a profit, or break even, depending on your initial stake. This means you should do some calculations or use hedge betting calculators to place a well-balanced amount of stake as your hedge bet.
Make sure to pick the right games
Hedge betting is a versatile sports betting strategy that can be used in any sports and sports betting market. However, picking the best game and the best market can dramatically increase your chances of walking away with considerable winnings. It is recommended to pick matches that offer markets with only two possible outcomes. This way, you will be more likely to lock in profits and avoid losing a lot of money by betting on the opposite outcome.
Don’t rely primarily on game analysis
Game analysis is not all you need to place a successful hedge bet. Several factors must be considered, including weather and other external factors that affect the course of the game and consequently change the odds as the game continues. Hence, the main takeaway is understanding the concept of hedge betting and knowing when and why to hedge a bet.
Practice risk management
This is where the ability to make the right mathematical decisions comes into the picture. A good bettor can mitigate the risks by placing an optimal stake. This means they well-balance their bets and place a hedge bet that will only lose a little if the worst-case scenario happens. In short, you must consider the worst-case scenario, balance your wagers, and manage the risks involved.
Compare odds offered by different bookmakers
We always recommend shopping around. This means it is a good idea to make multiple accounts on different bookmakers and compare their odds for the same match you want to bet on. This is a good strategy to find the most favorable odds.
Take advantage of bonus offers
Always use free stuff offered by bookmakers to make the most out of your bets. Bookies compete with each other to attract more players. For this reason, they offer various bonuses and promotions in the form of free bets, reload bonuses, and cashback promos. You can use such offers to place your initial bet or hedge bet. However, read each bonus terms and conditions thoroughly before claiming it, as most promos come with specific and, sometimes, strict terms.
Hedge Betting VS. Arbitrage Betting
As mentioned earlier, sports bettors, especially newbies, tend to confuse the two concepts and think they are the same. However, arbitrage and hedge betting are not the same things.
Arbitrage betting is when you place two opposite bets on the same sporting event at two different sportsbooks(back and lay bets). Arbitrage betting has a similar aim as hedging; increasing your chances of winning.
Hedging a bet, on the other hand, involves placing a bet on the opposite outcome of an active bet on the same bookmaker to compensate for the possible loss or increase your profit.
Is Hedge Betting Illegal?
Of course not. There is nothing illegal about hedge betting as it is a sports betting strategy to minimize bettors’ losses or lock in some profit.
To Sum It Up
Sports betting involves more risk than other kinds of gambling. Hence, strategies like hedge betting can minimize the possible losses or guarantee some profit, as explained in the example upper in this article. You can use hedge betting calculators to practice before placing your first hedge bet.