What is Arbitrage in Sports Betting?

Arbitrage Explained in Detail

Arbitrage opportunities arise when different sportsbooks disagree on the odds for the same event by enough that you can bet both sides and guarantee a profit. For example, if Book A offers Team A at +150 and Book B offers Team B at +150, the combined implied probability is 40% + 40% = 80%, leaving a 20% gap that represents guaranteed profit.

In practice, arbitrage margins are much smaller, typically 1-3%. Finding them requires monitoring odds across many sportsbooks in real time. Dedicated arbitrage software scans thousands of markets simultaneously and alerts bettors when an arb opportunity appears. Speed is critical because sportsbooks adjust their lines quickly.

While arbitrage sounds like free money, there are significant practical challenges. Sportsbooks hate arbers and will limit or close accounts that consistently exploit pricing differences. You need large bankrolls across many sportsbooks to make meaningful money from small percentage edges. And there is the risk of one side of your arb being canceled or settled differently than expected.

Some bettors use a softer version of arbitrage called value betting, where they bet only the side that appears mispriced rather than both sides. This does not guarantee a profit on each bet but can produce higher long-term returns because you are not diluting your edge by also betting the non-value side. Value betting is more sustainable because it looks less suspicious to sportsbooks.