Traditional sports arbitrage
techniques rely upon covering all outcomes of an event with bets within the same market.
These trades are relatively simple in terms of discovery and
calculation and are covered in
virtually every basic article or book on sports arbitrage.
Their relative simplicity makes these types of trades easily visible; any situation where all outcomes are covered and the prices convert to a summed percentage less than 100% will yield an arbitrage.
Cross-Market Trading Strategies use mathematical models to
generate risk-free trades between different sports-betting markets. This allows for a significantly greater range of more complex trades which are all but invisible to the vast majority of traders.
The bets within these trades have different properties to the norm and this means that
arbitrage conditions no longer rely upon the simple rule that the sum of the prices should convert to a percentage less than 100%.
This is a brief guide about Advanced Cross Market Trading Strategies
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SIMPLE EXAMPLES
Perhaps the easiest way to understand this is to consider the simple cross-market trading opportunities available in Tennis. Here, two inter-related markets on a particular match will be the Match Winner and Set Betting markets.
An arbitrage trade between these two markets would cover the outcome of one player winning by placing a bet in the Match Winner market, whilst covering the outcome of the other player winning by placing two or more bets in the Set Betting market. The latter bets effectively synthesise the Match Bet on Player 2.
Another simple application of this method is to find instances where the winner of a specific match or game will, de facto, be the winner of the tournament or series. For example, on the last day of Wimbledon in any year, a Match Bet on either player in the final can be offset by a
Tournament Winner bet on the opponent.
Taking this one step further, after the quarter-finals of the tournament, you can construct a two-stage trade whose initial components are a combination of bets from the two semi-final match-bet markets and the overall tournament winner market.
On a much more advanced level, the Match Bet, Asian and European handicap markets in soccer provide hundreds of ways to synthesise bets. The same is true for the Total Goals markets and their Asian Handicaps. It’s with these techniques that your trading will rise to a new level: the traditional rules, which limit the average trader, are lifted to set you free.
COMPLEX EXAMPLE
The most common cross market arbitrage trades occur in soccer, where bookmakers & betting exchanges offer a very wide range of Asian
handicap, European Handicap and Double-Chance bets as well as standard match bets.
Many cross-market sports arbitrage trades use bets whose properties include refunds under certain conditions, whilst other bets in the trade payout as winners. This obviously results in significantly higher profits than standard sports arbitrage trades.
Here's an example using a soccer match from the Italy Serie A:
The trade combines a (+2) Asian Handicap bet on Sampdoria with (-1.5) and (-2.5) Asian Handicap bets on Livorno
Bookie 1 Sampdoria (+2) 1.30
Bookie 2 Livorno (-1.5) 4.20
Bookie 3 Livorno (-2.5) 8.00
The first thing to notice is that to any conventional sports arbitrage trader, these prices would not indicate that an arb exists. Convert the prices into percentages and they sum to over 113%
However, this is an arb. Here's why...
Sampdoria (+2) pays out fully if Sampdoria wins, draws or loses by 1 goal. It's refunded completely if they lose by exactly 2 goals
Livorno (-1.5) pays out fully if Livorno wins by more than 1 goal Livorno (-2.5) pays out fully if Livorno wins by more than 2 goals
1. Equal profit irrespective of outcome
Sampdoria (+2): €84 | Livorno (-1.5): €6 | Livorno (-2.5): €10.50
MATCH OUTCOME SAMPDORIA (+2) LIVORNO (-1.5) LIVORNO (-2.5) TOTAL PAYOUT SAMPDORIA WINS €109.20 0 0 €109.20 DRAW €109.20 0 0 €109.20 LIVORNO WINS BY 1 GOAL €109.2 0 0 €109.20 LIVORNO WINS BY 2 GOALS €84.00 €25.20 0 €109.20 LIVORNO WINS BY MORE THAN 2 GOALS 0 €25.20 €84.00 €109.20
Your total investment in the trade is 100.50 and you will receive a payout of 109.20 irrespective of the result.
THE PAYOUTS
2. Bias in favour of Livorno (-1.5)
The stakes would be apportioned as follow
Sampdoria (+2): €77 | Livorno (-1.5): €22 | Livorno (-2.5): €1
MATCH OUTCOME SAMPDORIA (+2) LIVORNO (-1.5) LIVORNO (-2.5) TOTAL PAYOUT SAMPDORIA WINS $100.10 0 0 $100.10 DRAW $100.10 0 0 $100.10 LIVORNO WINS BY 1 GOAL $100.10 0 0 $100.10 LIVORNO WINS BY 2 GOALS $77.00 $92.40 0 $169.40 LIVORNO WINS BY MORE THAN 2 GOALS 0 $92.40 $8 $100.10
Your total investment in the trade is 100. All possible outcomes are covered without any risk and you will receive a payout of 169.40
if the result is Livorno wins by 2 goals. That's a risk-free profit of almost 70%
THE PAYOUTS
There are a total of 7 ways to bias your stakes in this and all 3-way cross market sports arbitrage trades:
1. No Bias
2. Bias towards Bet 1 3. Bias towards Bet 2 4. Bias towards Bet 3
5. Bias towards Bet 1 & Bet 2 6. Bias towards Bet 1 & Bet 3 7. Bias towards Bet 2 & Bet 3
HOW DO I GET STARTED?
This guide has given you a glimpse of what is possible with cross market sports arbitrage. There are over 350 different ways to combine Asian handicap, European Handicap, Double-Chance and Match bets as well as Under/Over bets and specific formulae are required to recognise them and calculate the appropriate stakes.
The automated service within the TraderZone is capable of finding all of these types of trades and its calculator makes it simple to understand and execute them.
However, if you would prefer to deepen your understanding of these trades before committing yourself in any trades, click here
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