Hedge Betting Explained

If you enjoy sports betting or even if you are a casual sports betting fan, you may have heard of the term ‘hedge betting’. The term is often used on many betting websites. There are thousands of people around the world who are participating in hedge-betting all the time.

However, if you are unfamiliar with the term and do not know what hedge betting means, you are missing out on the action. Continue reading below to find out more about hedge betting and to decide if it is something you would be interested in using in the future.

What is Hedge Betting?

The first thing to be aware of when hedge betting is not to worry about the links with arbitrage betting and matched betting. Think about hedge betting as something different completely. Regardless of any similarities between them as we will come to that later.

Hedge betting involves placing a bet to cover an existing bet as a way to reduce risk or guarantee a profit. A simple example is backing Player A to win a tennis match and also betting on Player B to win the match, thus covering both potential outcomes.

For hedge betting to work you are looking for a change in odds over time. For example, when it emerges Lionel Messi gets injured for Barcelona in the match build and the odds will change due to his importance to the team.

If you have backed the outsiders to win at a big price earlier in the day, the odds for a Barcelona will now have lengthened. You could back them at a different bookmaker and still make a profit.

matched-betting-explained-in-detail
Matched Betting offers work well with hedge betting

Why Hedge a Bet?

For what reasons would you decide to hedge a bet? After all, you will not make as much profit from the bet as you would if you let it run. But, taking the above example, you may hear some important team news which means you no longer have the confidence in the team you backed to win.

This could lead you into hedge betting by placing a bet on the other team.

Spread the Risk

Losing confidence in a bet you have already placed is one of the major reasons for hedge betting. By placing a second bet to cover both outcomes, you may still end up losing money but it will be a minimal loss. This is much better than what would have happened if you allowed your original bet to run on its own.

Guarantee Profit

Yet, you can also use hedge betting to guarantee a profit. This will depend on the type of bets you have placed but a good example is the winner of a football tournament. You may have backed Croatia to win the 2018 World Cup at the beginning of the tournament and they were out at 40/1 with some bookmakers.

They reach the final but come up against France, who are the favourites to win the match and the World Cup. If you placed a £50 bet on Croatia, you would stand to win £2000 if they lifted the World Cup. However, they are the outsiders and France are the 4/5 favourites to win the World cup. If you placed a £1,000 bet on France, you would win a profit of £800. Meaning whichever team wins the final, you guarantee a profit, whether it be £1,000 profit on Croatia or an £800 profit on France.

Croatia needs to get to the final for this to become possible but it shows an example of how hedge betting can guarantee a profit. Odds change and different situations crop up over the course of a tournament or season.

Hedge Betting In-play

The examples above are quite basic but give you a good idea of what hedge betting is all about. The winner of a tournament and winner of a match are regarded as being the best football markets for hedge betting.

You can also use hedge betting in-play when the moment is right. If you back the underdog to win and they take the lead. You could then use some of the potential profit by backing the favourites, who are now at higher odds to win the match.

Doing this bet will guarantee a profit and is a great way to use hedge betting to your advantage when betting on football matches.

Pros and Cons

The obvious positive aspect of hedge betting is that when the odds and an initial bet placed fall in our favour, we can guarantee a profit. The second advantage of hedge betting is we can reduce the potential loss from an original bet by placing a second bet.

The only disadvantage of using hedge betting is if your original bet turns out to be a winner and you hedged your bet to reduce risk. You will have lost the profit you would have gained if you allowed the bet to run.

Also, football markets are not always the best for hedge betting. Sports such as a game of tennis are good because you can only have two outcomes from a match, Player A wins or Player B wins, there is no other outcome. But, in football, you have the draw to contend with so it is best to use this betting technique on outright markets, such as a league or tournament winner.

Using Laying to Hedge Bets

You can, of course, place a lay bet to hedge your bets and this is like matched betting. Using a matched betting calculator, you can enter the stake and odds for your original bet. When you are ready to place a hedge bet, you can enter the lay odds and the commission amount for the exchange you are using.

The calculator will provide you with the best lay stake to maximise your profit regardless of the final outcome of the game.

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