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Sports Arbitrage Trading

See also

What do I need to start sports arbitrage trading?

Almost anybody can start taking advantage of sports arbitrage, but to make a worthwhile income, I suggest that you'll need the following:

  • Permission to gamble
    It must be legal for you to gamble. If you're under 18 or live somewhere where gambling is illegal then sports arbitrage is not for you. If you live in the USA then it is likely that you are not permitted to gamble. Bookmakers require you to specify your country when you join their websites, so you may be blocked from gambling if it is illegal in your country.

  • A reasonable amount of money to invest (your "bank")
    OK you could start using sports arbitrage with only a few pounds (or similar in your own currency). However you must remember that your profit will be a small percentage (typically 1-5%) of your total investment in each opportunity. So if you only invest 10 in a 5% (which is a good return!) arb, you'll only make 50p profit! Therefore you need to invest as much money as you can in order to show good returns. I would suggest a started bank of a couple of thousand pounds in pretty much essential. A bank of 500 might show returns of 20 per arb, which is not bad at all if you're doing this part time to generate a little bit of extra cash.

    It's not wise to invest money that you need to pay the bills because events can be delayed and bets settled late. Only use money that you afford to leave invested for a while.

  • Plenty of free time
    You're going to have to spend some time looking for sports arbitrage opportunities, they won't just fall into your lap! At first it'll probably take while to get used to this type of activity, but after a while you'll get better. If you have a couple of hours per day free then you'll probably be able to find a few arbs. However if you plan to make serious amount of cash then you'll need more spare time.

  • Be well organised
    You're going to be placing numerous large bets with different bookmakers on events that will be settled (you winnings paid) at all different times. You need to remember (or better still record) all of your transactions so that you know where your money is. You will need to request withdrawals from each bookmaker once your winnings have been credited to your online account.

  • General sports and betting knowledge
    Various websites claim that you need no sporting or betting knowledge before starting as a sports arbitrage trader. That's partly true. But would you invest your money anywhere where you don't have a clue what's going on? It's not a good idea!

    Contrary to what you might hear, you should have some prior sports and betting knowledge before engaging in sports arbitrage. When you're talking about staking large amounts of money, you should know some basic things about the sports you'll be betting on and what the different types of bets are.

  • Internet access (broadband will help)
    Of course you'll need internet access to access the many bookmakers online. Broadband internet access is a definite benefit because the sites will load faster and the whole process of researching odds will be a lot faster.



Research into sports arbitrage

It's a good idea to do plenty of research into sports arbitrage before embarking as a trader. Here are some websites that I recommend you read:

Update 16th March 2005

The Arbbest forum is now available again after being temporarily lost for approximately one week due to the domain name expiring. Unfortunately all the old posts seem to have been lost during the disruption.

Update 30th May 2005

It looks like the Arbbest forum has been under the control of ZRA all along (see the arbitrage scams section).

It's still worth reading because the regulars post useful information and advice. However, beware ayone who appears to support ZRA too entheusiastically and remember that some negative posts about ZRA and Alan Seymour / "Sports Arbitrage Review" have now been removed!



Things to avoid!

  • Sports arbitrage investment programmes
    You may see websites that ask you to hand over money for them to invest in sports arbitrage opportunities in and promise a 10-20% return on your money. These are scams! Don't be temped to give them your cash. There are many reasons why they cannot be legitimate, which I will discuss further on.

  • Automated sports arbitrage software
    There are many websites that offer software that runs from your computer which supposedly scans bookmakers' websites and will notify you of any arbs that are available. Although sound in theory, many people have found this software to be virtually useless in practice.

  • Costly sports arbitrage calculators
    Whenever you place an arb, you'll need to know how much to stake on each selection. There are tools available that will calculate this for you. One company (who shall remain nameless) sells Excel spreadsheets for 67 and another charges 30 per year. You do not need to pay for this! Read on for my selection of free sports arbitrage calculators.

  • Dodgy foreign bookmakers
    Only use bookmakers that are trusted. Ideally only use ones that have been established for a couple of years and have good reviews from online communities. There's nothing worse than having your winnings disappear if a bookmaker goes bust! It does happen, so if a price looks far too good to be true, leave it well alone.

  • Palpable errors
    In the course of looking for an arbitrage opportunity you may spot a bookmaker whose price is way out of line with the rest of the market. It could be the case that the bookmaker in question has transposed his odds. This means that the odds are correct but have been entered the opposite way around (i.e. the favourite has the outsider's odds and vice versa). Don't be temped to bet on this and create a massive arb for yourself. The bookmakers have a rule regarding palpable (obvious) errors which states that they are allowed to void bets on them without notice. So you may end up with only one bet standing and a lot of money being risked.

  • Sports arbitrage software pyramid schemes
    There are a number of websites that operate like pyramid selling schemes and promote automated sports arbitrage software (as mentioned above). Their users have been spamming many online sports arbitrage forums recently and the resounding advice is to keep well clear of them!

 
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