Arbitrage betting, also known as arbing or sure betting and value betting or +EV betting are two profitable strategies in betting. Arbitrage betting involves placing bets on all outcomes of an event to guarantee a profit by exploiting differing odds from bookmakers. Value betting focuses on finding bets where the odds are higher than the actual probability, giving the bettor a long-term advantage over the bookmaker.

In this article, we’ll explore why you should stop relying on arbitrage betting and start shifting toward value betting. We'll look at how arbitrage betting reduces your advantage by hedging with negative-value bets, why it's harder to maintain due to bookmaker restrictions, and how value betting not only offers higher returns but is also more sustainable in the long run despite the increased variance.

Before proceeding, if the concepts of arbitrage and value betting aren't clear or you're unfamiliar with terms like edge and variance, we recommend reading those articles first for a better understanding:

What is Arbitrage and Value Betting?

What is an Edge in Sports Betting?

The Problem with Arbitrage Betting: Two Bets, One Edge

In arbitrage betting, you place bets on all possible outcomes of an event, but only one of those outcomes typically carries an edge. The other bets are placed to hedge the risk. The problem is that to guarantee this profit, you are placing a bet with an edge and one (or more) bet with a negative edge just to minimize risk, reducing the value of your advantage.

Let’s go through an example. Let’s assume that Djokovic and Nadal face off in a tennis match and both have a 50% chance of winning. Bookmaker A offers odds of 1.90 for both players, while Bookmaker B offers Djokovic at 2.20 and Nadal at 1.70.

Here’s a table that summarises the example:

• True odds represent the fair or "real" odds based purely on the actual probability of an event occurring (calculated as 1/outcome probability), without any added margin from the bookmaker.
• Player Edge is the advantage or disadvantage a bettor has compared to the true odds, based on the odds offered by a bookmaker. A positive edge indicates a profitable bet, while a negative edge suggests the bet is not favourable.

As an arbitrage bettor, a sure betting calculator would suggest to split $100 by betting:

• $46.34 on Djokovic at 2.20 (positive edge with a 50% chance of winning).
• $53.66 on Nadal at 1.90 (negative edge, just to reduce the risk).

Now, regardless of who wins, your total payout would be the same:

• If Djokovic wins: $46.34 × 2.20 = $101.95.
• If Nadal wins: $53.66 × 1.90 = $101.95.

So, no matter the outcome, you make a guaranteed profit of $1.95. The downside is that you placed a bet on Nadal at poor odds (1.90).

In value betting, you would only place a bet where you have a positive edge. In this case, you would only bet on Djokovic at 2.20. If you placed a $100 bet on Djokovic, you would have:

• A 50% chance of winning $220.
• A 50% chance of losing your $100.

This gives you an expected value of:

This means that in the long term, you expect to make a 10% profit on each bet.

While arbitrage guarantees a small profit ($1.95 in this example), it limits your potential by hedging with a negative-value bet. In contrast, value betting focuses only on bets with positive expected value, leading to much higher long-term profitability.

Why Should You Prefer Value Betting if Arbitrage Betting is Risk-Free?

Some might think that placing large bets for a small but guaranteed profit in arbitrage betting is worthwhile. However, to make arbitrage betting truly profitable, you would need to place much larger bets because arbitrage opportunities are rare, and the profit margin (the edge) is smaller than in value betting. For instance, in the Djokovic-Nadal example, making a $10 profit requires a $100 turnover in value betting, but over $512 in arbitrage betting. This illustrates how much more capital is needed in arbitrage to achieve the same return.

Betting larger amounts will increase the likelihood of attracting attention from bookmakers. Once noticed, bookmakers can quickly impose restrictions or limits on the amount you can wager, effectively cutting off your ability to continue profiting from arbitrage.

On the other hand, value betting provides a higher average edge, more frequent profitable opportunities, and it is more difficult for bookmakers to detect. By placing multiple smaller bets, you can delay potential restrictions while reducing variance and optimising your long-term profits.

Another significant downside in arbitrage betting is that bookmakers can void one of your bets if they label it as a "palpable error." This occurs when bookmakers mistakenly offer incorrect odds, and once they realize the mistake, they void the bet to avoid potential losses. For example, if you placed an arbitrage bet on Djokovic and Nadal, and the bookmaker voids your bet on Djokovic (which had the positive edge), you would be left with a large negative expected value (EV) bet on Nadal at unfavorable odds. This can result in significant losses, making arbitrage betting riskier than it initially appears. Value betting avoids this issue since you're not relying on hedging across multiple outcomes, but rather focusing on betting where you have an edge.

Where Can You Start?

If you're an arbitrage bettor ready to switch to value betting and want to maximize your returns, or if you're new to the betting world, you're in the right place! Trademate Sports is the ideal platform to help you get started. With their advanced tools designed to spot value betting opportunities, you'll have everything you need to gain an edge and boost your profits. As a special offer, you can enjoy a free one-week trial to see the benefits firsthand.

What are you waiting for? Get your free trial here, take advantage of this opportunity, and begin your journey to long-term betting success today!