In this article I am going to detail a horse racing arbitrage strategy that I like to use occasionally to mix up my betting patterns.
This strategy is profitable and is a good way of taking extra value from the bookies.
If you are unfamiliar with arbitrage and want to learn about arbitrage betting. I recommend reading this excellent resource on arbitrage betting.
This strategy as it is a good way of moving money from bookmakers to exchanges but also getting some value in the process.
First off you are going to need a low commission betting exchange such as Smarkets or Matchbook and bookmakers that offer best odds guaranteed.
To find bookmakers that offer best odds guaranteed use oddschecker and look for a green tick box along the line noted at “best odds guaranteed.”
Horse Racing Arbitrage Strategy
First off we look for a horse that is a close back and lay price at a BOG(Best Odds Guaranteed) bookmaker (back) and low commission exchange (lay).
For this example I will use Smarkets.
In the picture above you will see the horse Copper Baked is priced at 1.91 with a number BOG bookmakers.
We can offer a lay price that matches the current BOG bookmaker prices. When the lay bet gets matched we then place the back bet at a BOG bookmaker.
From the above you can see that if the odds on Copper Baked stays the same price or comes in further we stand to win £90.90 for Bet365 and lose £90.01 from Smarkets for a £0.89p profit.
If Copper Baked loses we win £100 minus the 2% commission from Smarkets £98 and lose the £100 from Bet365.
Horse Racing Arbitrage Strategy
The key to this method is the large potential upside from the BOG (Best Odds Guaranteed) promotion. The Best Odds Guarantee promotion means that if a horses starting price drifts after you backed it you will get paid at the higher starting price.
So if Copper Baked price drifts before the off. With the starting price going off at a price higher then 1.9 then Bet365 would pay out at its starting price under the BOG promotion.
For example if Copper Baked drifted to 2.5 before the off and won we would then be paid £150 by Bet365 and lose only £90 from Smarkets. This would equal a profit of £60 when our risk of loss was only ever £2.
In this example we get a horse rated at 2.5 for odds of 31.0. This does happen fairly regularly in the horse racing markets.
From using this method there is always a much larger upside then there is downside.
Also by sticking to shorter favourites. It doesn’t look like conventional arbitrage to the bookmakers.
This method is a great way of building your trading bank alongside matched betting and arbitrage.
In order to make the most of this horse racing arbitrage strategy you will need an exchange that offers lower commission then Betfair.
Although this strategy is still profitable with Betfair it is much more profitable if you can access the 0% commission deals available with some bookmakers.
In the long term paying 2% less commission is going to going to add to much greater profits.
You can get 0% commission on both Smarkets and Matchbook by joining Oddsmonkey They offer a number of horse racing markets with ever increasing liquidity.
Alongside a host of other valuable tools that will allow you to make money from the sports betting markets.
Ryan is a former mixed martial arts and kickboxing competitor. After finishing university he played online poker and taught English for a living in Thailand for a few years.
Upon returning to England his focus has been on making a living from sports trading, betting and arbitrage. Over the course of 5 years he has managed to make a six figure profit using the strategies discussed on this site.
Ryan runs the sports betting and trading website www.smartsportstrader.com
4 thoughts on “Horse Racing Arbitrage Strategy – Small Risk For A Large Payoff”
Thanks for writing this up used it at the weekend. Backed a horse at 1.4 and layed it on Smarkets at 1.4 went off at 1.5 lovely made £20 on it
Laying first is a tad risky but I can certainly see the potential here. A good risk to reward ratio.
An interesting discussion is price comment. I think that you need to write extra on this topic, it may not be a taboo subject however generally persons are not sufficient to speak on such topics. To the next. Cheers
Nice blog as this will really help the player to win the bet thank you for providing such good information with players.