What Is Arbitrage Betting? A Beginner’s Guide to Guaranteed Profit

Imagine placing bets on a single sports event in a way that guarantees you make a profit, no matter which team wins. It sounds too good to be true, but it’s the core principle behind a mathematical strategy used by sharp bettors. Understanding what is arbitrage betting is the first step toward moving from pure chance to calculated returns. This strategy, also known as ‘arbing’ or creating ‘surebets,’ isn’t about luck; it’s about exploiting pricing inefficiencies in the betting market.

Arbitrage betting involves placing proportional bets on every possible outcome of an event across different sportsbooks. When the odds offered by these bookmakers differ enough, a small, risk-free profit margin is created. While individual profits are often small, typically 1-5% of your total stake, they can add up significantly over time with a disciplined approach.

This guide breaks down exactly how arbitrage betting works, how you can find these opportunities, and the tools you need to act on them before they disappear. We’ll also cover the risks involved and how to manage them effectively.

In a Nutshell

• Guaranteed Profit: Arbitrage betting is a strategy that exploits differences in odds across various sportsbooks to guarantee a profit, regardless of the event’s outcome.
• Mathematical, Not Gambling: It relies on a mathematical formula, not luck or sports knowledge. An opportunity exists when the implied probabilities of all outcomes add up to less than 100%.
• Speed is Essential: Arbitrage opportunities are fleeting and can disappear in minutes or even seconds as sportsbooks adjust their lines. Using specialized software is almost a necessity for success.
• Risks Exist: While the math is risk-free, practical risks include bet cancellation, stake limitations by bookmakers (‘gubbing’), and human error when placing bets under pressure.
• Bookmakers Disapprove: The practice is legal in jurisdictions where sports betting is allowed, but sportsbooks actively discourage it and may limit or close accounts of suspected arbers.

How Arbitrage Betting Works: The Core Concept Explained

At its heart, arbitrage betting is the practice of buying and selling in different markets to take advantage of a price discrepancy. In sports betting, the ‘markets’ are the different sportsbooks, and the ‘price’ is the odds they offer. The arbitrage betting meaning is simply to cover all outcomes of an event to lock in a profit.

Every set of odds has an ‘implied probability’—the likelihood of that outcome happening as suggested by the odds. Sportsbooks build a profit margin, known as the vigorish or ‘vig,’ into their odds, so the implied probabilities of all outcomes on a single bookmaker will always add up to more than 100%. For example, they might have two outcomes at -110 odds each, where the implied probability is 52.38% for each, totaling 104.76%. That extra 4.76% is their guaranteed profit.

An arbitrage opportunity, or ‘arb,’ occurs when you find odds at different sportsbooks where the total implied probability adds up to less than 100%. This removes the bookie’s edge and gives it to you.

A Practical Example of an Arbitrage Bet

Let’s use a simple tennis match between Player A and Player B. It’s a two-way market, meaning there are only two possible outcomes.

• Sportsbook 1 offers odds of +120 (Decimal: 2.20) for Player A to win.
• Sportsbook 2 offers odds of -110 (Decimal: 1.91) for Player B to win.

First, we calculate the implied probability for each outcome:

1. Player A at Sportsbook 1: Implied probability = 1 / 2.20 = 45.45%
2. Player B at Sportsbook 2: Implied probability = 1 / 1.91 = 52.36%

Now, add them together: 45.45% + 52.36% = 97.81%. Since this total is less than 100%, a guaranteed profit of 2.19% (100 – 97.81) is possible.

To calculate your stakes for a total investment of $100, you use this formula:

• Stake on an outcome = (Total Investment x Implied Probability of that outcome) / Total Implied Probability
• Stake on Player A: ($100 x 45.45%) / 97.81% = $46.47
• Stake on Player B: ($100 x 52.36%) / 97.81% = $53.53

Let’s see the results:

• If Player A wins: Your $46.47 bet at +120 odds pays out $102.23 ($46.47 x 2.20). Your profit is $2.23 ($102.23 – $100 total stake).
• If Player B wins: Your $53.53 bet at -110 odds pays out $102.24 ($53.53 x 1.91). Your profit is $2.24 ($102.24 – $100 total stake).

No matter who wins, you make a risk-free profit of over $2. This might seem small, but experienced arbers place dozens of these bets a day, turning small, consistent gains into a significant income.

 

Types of Arbitrage Bets You’ll Encounter

While the underlying principle remains the same, arbitrage opportunities appear in different forms depending on the sport and the type of bet. Understanding these variations is key to maximizing your opportunities.

Two-Way Arbitrage (2-Way Arbs)

This is the simplest and most common type of arb, as seen in the tennis example above. It applies to any event with only two possible outcomes. You place one bet on one side and a second bet on the opposing side.

• Common Markets: Moneyline bets in sports like tennis or volleyball, point spreads (e.g., Team A -7.5 vs. Team B +7.5), and totals (Over/Under 48.5 points).
• Example: Finding Over 2.5 goals in a soccer match at +110 on one bookie and Under 2.5 goals at +105 on another creates a simple two-way arb.

Three-Way Arbitrage (3-Way Arbs)

These are common in sports where a draw is a possible outcome, most notably soccer. You must cover all three outcomes: Team A wins, Team B wins, and a Draw. The calculation is the same, but you are now finding the best odds for three outcomes across different sportsbooks and ensuring their combined implied probability is under 100%.

• Common Markets: Soccer (1X2 market), hockey (3-way moneyline including regulation draw), and boxing/MMA where a draw is possible.
• Complexity: Three-way arbs are slightly more complex to calculate and execute quickly, as you have to place three separate bets before any of the odds change.

Middle Bets (Middles)

Middle bets are a special and highly profitable type of arbitrage opportunity. A middle occurs when you bet on both sides of a spread or total, and there’s a ‘middle’ range of outcomes where you can win both of your bets. While not a guaranteed profit in the traditional sense, they offer a ‘risk-free’ shot at a massive payout.

• Example: You bet on the Kansas City Chiefs -6.5 at Sportsbook A and the Buffalo Bills +7.5 at Sportsbook B. Your total risk is covered, creating a small arb. However, if the Chiefs win by exactly 7 points, your bet on the Chiefs (-6.5) wins, AND your bet on the Bills (+7.5) also wins. You cash both tickets for a huge return.
• Rarity: Middles are less common than standard arbs but are highly sought after. Tools that can identify these are incredibly valuable.

Click here to make money with sport betting

How to Identify Arbitrage Opportunities

Finding these fleeting opportunities is the biggest challenge in arbitrage betting. The market is efficient, and odds discrepancies are corrected quickly. There are two primary methods for identifying arbs: manually or with specialized software.

The Manual Method

Manually finding arbs involves opening dozens of browser tabs for different sportsbooks, comparing the odds for the same event, and using an arbitrage calculator to check if the implied probabilities are below 100%. You would need to scan hundreds of games and markets to find just one or two small opportunities.

• Process:
  1. Choose an event (e.g., an upcoming NFL game).
  2. Open 10-15 different sportsbook websites.
  3. Compare the odds for a specific market (e.g., the point spread).
  4. Input the best odds for each side into an online arb calculator.
  5. If an arb exists, quickly calculate stakes and place the bets.
• Drawbacks: This method is incredibly slow, tedious, and inefficient. By the time you find an opportunity and calculate the stakes, the odds have likely already changed. It’s nearly impossible to compete with automated systems and other arbers using this approach.

Using Arbitrage Betting Software

This is the method used by virtually all successful arbitrage bettors. Specialized software and services automatically scan the odds from dozens of sportsbooks in real-time. They instantly identify arbitrage opportunities and present them to you, complete with the profit percentage and the required stakes.

• How it Works: These platforms use powerful algorithms to compare odds across the market second by second. When an arb is detected, it’s displayed on a dashboard.
• Benefits:
  • Speed: Find opportunities the instant they appear.
  • Efficiency: Scans thousands of markets simultaneously, saving you countless hours.
  • Accuracy: Automatically calculates profit margins and stakes, reducing the risk of human error.
  • Convenience: Many tools include direct links to the sportsbooks, so you can place your bets quickly.

For anyone serious about arbitrage betting, using software isn’t just an advantage; it’s a necessity. The manual method simply can’t keep up.

The Real Benefits of Arbitrage Betting

While it requires effort and discipline, arbitrage betting offers several compelling advantages over traditional sports betting, making it an attractive strategy for those looking for a more systematic approach.

First and foremost is the guaranteed profit. When executed correctly, an arbitrage bet eliminates risk. You are no longer guessing which team will win; you are simply acting as a trader capitalizing on market inefficiencies. Your profit is locked in before the game even starts, providing a level of certainty that is impossible to achieve with regular betting.

Second, it’s a strategy based on mathematics, not opinion. Your success doesn’t depend on knowing a sport inside and out or having a ‘gut feeling’ about a team. The only thing that matters is the numbers. This removes the emotional highs and lows associated with gambling and transforms it into a more business-like activity.

You don’t need to worry about a last-second bad beat because the outcome is irrelevant to your bottom line.

Finally, it offers a scalable return on investment. While individual arb profits are small, the process is repeatable. With a sufficient bankroll spread across multiple sportsbooks, you can place numerous bets each day. The returns compound over time, allowing you to grow your bankroll systematically.

It’s a volume-based strategy where consistency is rewarded.

Risks and Challenges: What Bookies Don’t Want You to Know

While the math behind arbitrage is sound, the real-world application comes with its own set of risks and challenges. Understanding these hurdles is critical to long-term success and avoiding costly mistakes.

Account Limitations and Closures (‘Gubbing’)

This is the single biggest threat to an arbitrage bettor. Sportsbooks are private businesses, and they exist to make money from bettors, not the other way around. While arbitrage is legal, it’s against their terms of service. If they identify you as an arber, they will take action.

• Stake Limiting: The most common action is to severely limit the amount you can wager, sometimes to just a few dollars. This effectively makes it impossible to continue arbing on that account.
• Account Closure: In more extreme cases, they may close your account and return your balance.

Bookmakers use sophisticated software to detect arbing patterns, such as consistently betting on obscure markets or placing bets with very specific, unrounded stake amounts (e.g., $131.47 instead of $130).

Rapidly Changing Odds

Arbitrage opportunities exist because of temporary discrepancies. These are often corrected within minutes, if not seconds. A major risk is placing one ‘leg’ of the arb, only for the odds on the other side to change before you can place the second bet. This leaves you with an exposed, regular bet that is no longer risk-free.

Bet Cancellation

Occasionally, a sportsbook will cancel a bet after it has been placed, citing an ‘obvious error’ or ‘palpable error’ in the odds. If this happens to one leg of your arb, your entire position is compromised. You’re left with a one-sided bet and have to decide whether to let it ride or try to ‘hedge’ it at a loss.

Human Error

When you’re racing against the clock to place multiple bets, mistakes can happen. You might accidentally bet on the wrong team, enter the wrong stake amount, or bet on the wrong market (e.g., first-half spread instead of the full-game spread). These simple errors can turn a guaranteed profit into a guaranteed loss.

Pro Tip: To avoid detection, many arbers practice ‘mug betting.’ This involves placing occasional, small, regular bets on popular events (like the NFL or NBA) to make your account activity look more like that of a typical recreational bettor. This can help prolong the life of your accounts.

Essential Tools and Software for Arbitrage Bettors

Given the need for speed and accuracy, relying on the right tools is non-negotiable for anyone serious about arbitrage betting. Manual searching is a relic of the past; modern arbing is driven by powerful software that does the heavy lifting for you. These platforms scan hundreds of sportsbooks in real-time, flagging opportunities the moment they arise.

Choosing the right software depends on your location, budget, and the sports you want to focus on. Here are a few of the leading options in the market:

OddsJam

Primarily focused on the North American market, OddsJam is a comprehensive suite of betting tools that includes a powerful arbitrage scanner. It covers all major US sportsbooks like DraftKings, FanDuel, and Caesars, making it ideal for bettors in the United States and Canada. Beyond just arbs, it also identifies Positive Expected Value (+EV) bets, providing multiple ways to find an edge. Its user-friendly interface and educational resources make it a strong choice for both beginners and experienced bettors.

RebelBetting

One of the oldest and most respected names in the industry, RebelBetting has been serving arbitrage and value bettors for over a decade. It offers robust software with extensive coverage of global sportsbooks, making it particularly popular in Europe. They claim a typical monthly profit of 10-20%, backed by a profit guarantee for new users. Their platform is known for its reliability and speed, which are crucial for catching arbs before they vanish.

Arb Amigo

Arb Amigo is another popular tool that provides real-time arbitrage alerts. It positions itself as a user-friendly and affordable option for those looking to get into arbing. The platform scans a wide range of bookmakers and sports, delivering opportunities directly to your dashboard. It’s a solid choice for those who want a dedicated tool focused purely on finding and executing surebets efficiently.

Ultimately, the best tool is one that covers the sportsbooks available to you and fits your workflow. Most of these services offer free trials or introductory periods, allowing you to test their effectiveness before committing to a subscription.

Is Arbitrage Betting Legal? Understanding the Rules

This is one of the most common questions from newcomers, and the answer is simple: Yes, arbitrage betting is legal. There are no laws in the United States, United Kingdom, or other major betting jurisdictions that prohibit you from placing bets with different companies to guarantee a profit. You are simply using publicly available information (the odds) to your advantage.

However, there is a critical distinction between being legal and being welcomed by sportsbooks. While you won’t face legal trouble, you will almost certainly face repercussions from the bookmakers themselves if you are caught. As mentioned earlier, arbitrage betting is a direct violation of the terms and conditions of most, if not all, online sportsbooks.

Their business model relies on the vig and on the majority of bettors losing over the long run. Arbers represent a guaranteed loss for them, so they have a strong financial incentive to identify and restrict these accounts. Think of it like a casino that can legally ask a card counter to leave. The casino can’t have the player arrested for counting cards, but they can refuse their business.

Sportsbooks operate under the same principle.

So, while you operate within the bounds of the law, you must also operate discreetly to avoid having your accounts limited or closed. This is the cat-and-mouse game that every arbitrage bettor must play.

Smart Bankroll Management for Arbing Success

Effective bankroll management is the backbone of any successful betting strategy, and it’s especially important in arbitrage. Because profit margins are small, you need to be disciplined and systematic with your capital to see meaningful growth and withstand any potential issues.

First, you need a dedicated bankroll. This is a sum of money set aside exclusively for your arbitrage activities. It should be an amount you are comfortable with, as it will be spread across multiple online accounts. A common starting point is between $1,000 and $2,000, but you can start with less if needed.

Second, you must distribute your funds across multiple sportsbooks. You can’t perform arbitrage with just one or two accounts. To find the necessary odds discrepancies, you’ll need to be funded and ready to bet at 10, 15, or even more different bookmakers. This allows you to jump on any opportunity without needing to wait for deposits to clear.

Third, determine your standard stake size. Many arbers risk a consistent percentage of their total bankroll on each arb, often between 3% and 5%. For example, with a $2,000 bankroll, a 5% stake would mean a total investment of $100 per arb. This ensures that you are not overexposed on any single position and that your bets grow in proportion to your bankroll.

Finally, keep meticulous records. Track every bet you place, including the event, sportsbooks, stakes, odds, and profit. This helps you monitor your overall profitability, identify which bookmakers are most valuable, and manage your funds effectively across all your accounts.

A Real-World Case Study: Seeing an Arbitrage Bet in Action

Let’s walk through a hypothetical but realistic scenario to see how an arbitrage bet plays out from start to finish. Imagine you’re using an arbitrage scanner on a Saturday morning and an alert pops up for an upcoming NBA game between the Boston Celtics and the Miami Heat.

Step 1: The Opportunity is Identified
Your software flags a 2.8% arb on the total points market.

• FanDuel: Offers Over 215.5 points at odds of -105 (1.95 decimal).
• DraftKings: Offers Under 215.5 points at odds of +115 (2.15 decimal).

The software confirms the combined implied probability is 97.2%, creating a profitable opportunity.

Step 2: Calculate the Stakes
You decide to place a total of $200 on this arb. The software’s built-in calculator suggests the optimal stakes:

• Bet $103.61 on Over 215.5 at FanDuel.
• Bet $96.39 on Under 215.5 at DraftKings.

Step 3: Placing the Bets Quickly
You immediately click the links provided by the software. You open FanDuel first, confirm the odds haven’t changed, and place your $103.61 wager. Then, you quickly switch to DraftKings, verify the +115 odds are still available, and place your $96.39 wager. The entire process takes less than 60 seconds.

Step 4: Calculating the Guaranteed Profit
Now, you wait for the game to end, knowing your profit is already locked in. – If the total score is 216 or more (Over hits): Your FanDuel bet wins. Payout = $103.61 * 1.95 = $202.04. Your net profit is $2.04 ($202.04 – $200 total stake).

• If the total score is 215 or less (Under hits): Your DraftKings bet wins. Payout = $96.39 * 2.15 = $207.24. Your net profit is $7.24 ($207.24 – $200 total stake).

In this case, the profit is slightly different depending on the outcome due to rounding the stakes, but a profit is guaranteed either way. You’ve successfully executed an arb and added to your bankroll without any risk related to the game’s outcome.

Top Tips for Beginner Arbitrage Bettors

Getting started with arbitrage betting can feel overwhelming. The key is to start slow, stay disciplined, and follow a few fundamental principles to build your confidence and your bankroll.

1. Start Small: Don’t jump in with your entire bankroll. Start with small total stakes ($25-$50 per arb) to get comfortable with the process of quickly placing bets across different sites. This minimizes the cost of any beginner mistakes.
2. Verify Everything: Before placing a bet, always double-check the odds on the sportsbook’s site to ensure they match what your software is reporting. Also, triple-check that you are betting on the correct market, team, and amount.
3. Prioritize Speed and Accuracy: The best arbs disappear quickly. Be prepared to act fast, but never sacrifice accuracy for speed. It’s better to miss an opportunity than to make a costly error.
4. Round Your Stakes: To avoid looking like a typical arber, round your bet amounts to the nearest dollar or five dollars. Instead of betting $57.82, bet $58 or even $60. This slightly unbalances the arb but makes your activity look more natural.
5. Use a Separate Bank Account: Open a bank account or use a digital wallet like PayPal exclusively for your betting activities. This makes it much easier to track your bankroll, profits, and overall performance without mixing it with your personal finances.

Frequently Asked Questions About Arbitrage Betting

Can you lose money in arbitrage betting?

While the mathematical theory of arbitrage is risk-free, you can lose money due to practical, real-world errors. The most common ways to lose money are through human error (placing the wrong bet), having one leg of your bet canceled by the bookmaker, or failing to place all bets before the odds change. If executed perfectly, you cannot lose.

How do bookies know you are arbing?

Sportsbooks use sophisticated algorithms to flag accounts with unusual betting patterns. They look for bettors who consistently take advantage of off-market odds, bet on obscure sports or leagues, and use very specific, unrounded stake amounts. They also monitor how quickly a user bets after odds are posted, as arbers tend to act much faster than recreational players.

How much bankroll do you need to arbitrage a bet?

You can start with as little as a few hundred dollars, but a bankroll of $1,000 to $2,000 is a more realistic starting point for seeing meaningful returns. This amount allows you to have sufficient funds deposited across 10-15 different sportsbooks so you can act on opportunities immediately without being delayed by transaction times.

Is arbitrage possible for beginners?

Yes, arbitrage is very possible for beginners, especially with the help of modern software. The concept is straightforward, and tools like OddsJam and RebelBetting simplify the process of finding opportunities and calculating stakes. The key for a beginner is to start with small stakes, be meticulous, and learn to manage the practical risks involved.

Conclusion: Is Arbitrage Betting Worth It for You?

Arbitrage betting stands apart from nearly every other form of sports betting. It’s not a get-rich-quick scheme but a systematic, mathematical approach to generating consistent, low-risk returns. For individuals who are disciplined, detail-oriented, and willing to treat it like a business, arbing can be a worthwhile and profitable endeavor. The arbitrage betting explained in this guide shows a clear path to profit, but it’s a path that requires diligence.

The strategy’s success hinges on speed, accuracy, and effective management of your accounts to prolong their lifespan. The challenges, particularly the risk of account limitations, are real and unavoidable. However, with the right tools to identify opportunities and a smart approach to placing bets, these hurdles can be managed effectively.

If you’re tired of the uncertainty of traditional gambling and are looking for a way to use logic and math to beat the bookies, arbitrage betting is a powerful strategy to consider. For those ready to dive in, exploring a tool like OddsJam for the US market or RebelBetting for global coverage is the logical next step to turn theory into profit.