Simple Arbitrage Calculator
This Arbitrage 'Arb' Calculator works out for how much a current bet, or lay, can be matched so that no matter whom wins the event the user is guaranteed a fixed profit.
For example, one could have backed Greece to win Euro 2004 for £20 at 140.0 on the exchanges. After their first match, when they beat Portugal, the price dropped to 60.0. By using this calculator one can see that laying Greece to lose at 60.0 for a stake of £46.67 would ensure that the user would make a profit of £26.67 no matter which team won the event. A similar technique was performed by us to 'Arb' Sweden whose price came in before the tournament started. In this case we made a guaranteed profit using the Swedish 'Arb' even before a single ball was kicked!
This can also be done with prices which are moving out. For example, if we laid a horse at evens for £20 and it was later seen by everyone else as a 'weak favourite' in the market and drifted out to 4/1, then backing it for £8 would guarantee a profit.
Let's work this out. If the horse lost then we would earn £20 from the lay but lose £8 from the failed backing bet; giving us £12 profit. If, on the other hand, the horse won then we'd have to pay out £20 from the winning lay but we'd get in £32 from the backing the winner again making a profit of £12.
So, all that one needs to do is to correctly identify something in the market which is either priced far too high or far too low and then back accordingly and then wait for the market to readjust itself and then make a profit on the resulting 'Arb'. And, even if the 'Arb' wasn't settled you still would have ended up with a backing bet on an overpriced horse or a laying bet on an underpriced horse. Neither of which can be described as a bad thing.
So, arm yourself with a oopy of the UKHR Ratings and get 'Arbing' today...
This calculator works if you have already placed a bet and you now wish to 'Arb' it. Simply enter the price and the stake of the bet (or lay) which you have on the market in the top two cells of the calculator and then enter the current price in the bottom cell and click on 'Enter'.
The stake level of the opposite bet which you have to place to make a guaranteed profit is returned on the left hand side. Note that for this to work the price must have risen if you currently hold a lay bet or the price must have dropped if you hold a back bet.