Cross Market Sports Arbitrage Trading

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					How To Become A Successful Sports Arbitrage Trader




              This is a brief guide about Advanced Cross Market Trading Strategies




INTRODUCTION

Traditional sports arbitrage                               Cross-Market Trading Strategies
techniques rely upon covering all                          use mathematical models to
outcomes of an event with bets                             generate risk-free trades between
within the same market.                                    different sports-betting markets.


These trades are relatively simple                         This allows for a significantly
in terms of discovery and                                  greater range of more complex
calculation and are covered in                             trades which are all but invisible to
virtually every basic article or book                      the vast majority of traders.
on sports arbitrage.
                                                           The bets within these trades
                                                           have different properties to the
Their relative simplicity makes                            norm and this means that
these types of trades easily                               arbitrage conditions no longer
visible; any situation where all                           rely upon the simple rule that
outcomes are covered and the                               the sum of the prices should
prices convert to a summed                                 convert to a percentage less
percentage less than 100% will                             than 100%.
yield an arbitrage.



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                                for sports arbitrage traders around the world.
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How To Become A Successful Sports Arbitrage Trader




SIMPLE EXAMPLES

Perhaps the easiest way to understand this is to consider the simple
cross-market trading opportunities available in Tennis. Here, two inter-
related markets on a particular match will be the Match Winner and Set
Betting markets.


An arbitrage trade between these two markets would cover the outcome
of one player winning by placing a bet in the Match Winner market, whilst
covering the outcome of the other player winning by placing two or more
bets in the Set Betting market. The latter bets effectively synthesise the
Match Bet on Player 2.


Another simple application of this method is to find instances where the
winner of a specific match or game will, de facto, be the winner of the
tournament or series. For example, on the last day of Wimbledon in any
year, a Match Bet on either player in the final can be offset by a
Tournament Winner bet on the opponent.


Taking this one step further, after the quarter-finals of the tournament,
you can construct a two-stage trade whose initial components are a
combination of bets from the two semi-final match-bet markets and the
overall tournament winner market.


On a much more advanced level, the Match Bet, Asian and European
handicap markets in soccer provide hundreds of ways to synthesise bets.

The same is true for the Total Goals markets and their Asian Handicaps.

It’s with these techniques that your trading will rise to a new level: the
traditional rules, which limit the average trader, are lifted to set you free.
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How To Become A Successful Sports Arbitrage Trader




COMPLEX EXAMPLE

The most common cross market arbitrage trades occur in soccer, where
bookmakers & betting exchanges offer a very wide range of Asian
handicap, European Handicap and Double-Chance bets as well as
standard match bets.

Many cross-market sports arbitrage trades use bets whose properties
include refunds under certain conditions, whilst other bets in the trade
payout as winners. This obviously results in significantly higher profits
than standard sports arbitrage trades.

Here's an example using a soccer match from the Italy Serie A:

The trade combines a (+2) Asian Handicap bet on Sampdoria with (-1.5)
and (-2.5) Asian Handicap bets on Livorno

           Bookie 1                  Sampdoria (+2)      1.30
           Bookie 2                    Livorno (-1.5)    4.20

           Bookie 3                    Livorno (-2.5)    8.00

The first thing to notice is that to any conventional sports arbitrage
trader, these prices would not indicate that an arb exists. Convert the
prices into percentages and they sum to over 113%

However, this is an arb. Here's why...

Sampdoria (+2) pays out fully if Sampdoria wins, draws or loses by 1
goal. It's refunded completely if they lose by exactly 2 goals

Livorno (-1.5) pays out fully if Livorno wins by more than 1 goal

Livorno (-2.5) pays out fully if Livorno wins by more than 2 goals
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How To Become A Successful Sports Arbitrage Trader

THE PAYOUTS

There are a number of ways in which a trader can apportion his stakes on
this trade: for an equal profit irrespective of the match’s outcome or with
a bias towards any two or any single outcome. The first method is
conservative, the others remain risk-free but can result in significantly
lower or higher profits which will depend on the quality of the trader’s
judgement.

1. Equal profit irrespective of outcome

    Sampdoria (+2): €84 | Livorno (-1.5): €6 | Livorno (-2.5): €10.50




     MATCH              SAMPDORIA               LIVORNO       LIVORNO     TOTAL
    OUTCOME                (+2)                   (-1.5)        (-2.5)   PAYOUT

   SAMPDORIA               €109.20                     0         0       €109.20
     WINS

       DRAW                €109.20                     0         0       €109.20

     LIVORNO                €109.2                     0         0       €109.20
     WINS BY
      1 GOAL

     LIVORNO                €84.00                   €25.20      0       €109.20
     WINS BY
     2 GOALS

    LIVORNO                     0                    €25.20    €84.00    €109.20
    WINS BY
   MORE THAN
    2 GOALS


             Your total investment in the trade is 100.50 and you will
               receive a payout of 109.20 irrespective of the result.

                            That's a risk-free profit of about 8%




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How To Become A Successful Sports Arbitrage Trader




THE PAYOUTS

2. Bias in favour of Livorno (-1.5)

The stakes would be apportioned as follow

Sampdoria (+2): €77 | Livorno (-1.5): €22 | Livorno (-2.5): €1


     MATCH              SAMPDORIA               LIVORNO       LIVORNO     TOTAL
    OUTCOME                (+2)                   (-1.5)        (-2.5)   PAYOUT

   SAMPDORIA               $100.10                     0         0       $100.10
     WINS

       DRAW                $100.10                     0         0       $100.10

     LIVORNO                                           0         0
     WINS BY               $100.10                                       $100.10
      1 GOAL

     LIVORNO                                                     0
     WINS BY                $77.00                   $92.40              $169.40
     2 GOALS

    LIVORNO                     0                    $92.40      $8
    WINS BY                                                              $100.10
   MORE THAN
    2 GOALS


     Your total investment in the trade is 100. All possible outcomes are
      covered without any risk and you will receive a payout of 169.40
                    if the result is Livorno wins by 2 goals.

                          That's a risk-free profit of almost 70%



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How To Become A Successful Sports Arbitrage Trader




THE PAYOUTS

There are a total of 7 ways to bias your stakes in this and all 3-way cross
market sports arbitrage trades:

1. No Bias

2. Bias towards Bet 1

3. Bias towards Bet 2

4. Bias towards Bet 3

5. Bias towards Bet 1 & Bet 2

6. Bias towards Bet 1 & Bet 3

7. Bias towards Bet 2 & Bet 3




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How To Become A Successful Sports Arbitrage Trader




HOW DO I GET STARTED?

This guide has given you a glimpse of what is possible with cross market
sports arbitrage. There are over 350 different ways to combine Asian
handicap, European Handicap, Double-Chance and Match bets as well as
Under/Over bets and specific formulae are required to recognise them
and calculate the appropriate stakes.

The automated service within the TraderZone is capable of finding all of
these types of trades and its calculator makes it simple to understand and
execute them.

However, if you would prefer to deepen your understanding of these
trades before committing yourself in any trades, click here




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How To Become A Successful Sports Arbitrage Trader




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Our latest innovation is the TraderZone sports arbitrage trading platform. This is
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                                                     8

				
DOCUMENT INFO
Description: Cross-Market Trading Strategies use mathematical models to generate risk-free trades between different sports-betting markets. This is in contrast to traditional sports arbitrage techniques, which rely upon covering all outcomes of an event with bets within the same market. A cross-market trading strategy allows for a significantly greater range of more complex trades which are all but invisible to the vast majority of traders.The bets within these trades have different properties to the norm and this means that arbitrage conditions no longer rely upon the simple rule that the sum of the prices should convert to a percentage less than 100%.
About I spent most of the 1990’s as a foreign exchange dealer and futures trader in the City of London. Leaving the City in 1997 to focus on new opportunities unfolding as the Internet became mainstream, I discovered a rapidly growing range of risk free arbitrage trading opportunities created in the online sports-betting markets. After a year of research, during which I ran a successful private sports-arbitrage trading fund, in 1998 I created the world’s first and foremost sports-arbitrage trading software, ArbAlarm. Today, I focus my attention on helping new traders through my articles, books, seminars and software innovations on my website www.sportsarbitrageworld.com