The rapid growth of online and mobile betting has immensely
changed the manner of investing in football. It has allowed punters to try new
strategies and explore various ways of making profit. It has also enabled new
trends in betting behavior to emerge amongst punters. And one of the trends
that is growing in popularity is hedging.
What is bet hedging? It is offsetting a bet you have done
with another of the opposite prediction. It is backing a team to get a result
then laying the team not to get that same result. It is like predicting that
Manchester United will win a match against Chelsea in one bet and then making
another bet that Chelsea will beat Manchester United. Both events can’t occur
at the same time, so one bet will go down while the other may win.
Hedging can only work for you if you know how to search for
value in the market. Let us say, for example, that you place a bet of Ksh 10,000
at the start of the English Premier League season that Chelsea will win the
league title at odds of 4.00. You will be expecting to win Ksh 40,000 at the
end of the season should Chelsea win the title.
But what if you also
think the closest challenger to Chelsea would be Manchester United and so you
may lose your bet if Manchester United wins? You can place another bet to
cushion yourself of a potential loss by backing Manchester United with say Ksh
5,000 at the odds of say 7.00 to win, giving you a potential win of Ksh 35,000.
So if Chelsea wins you make a total profit of Ksh 25,000 (40,000-15,000) and if
Manchester United wins you make a profit of Ksh 20,000 (35,000-15,000). While
the profit on the two different bets may not be the same because of the different
odds, hedging is all about weighing and balancing your options to minimize the
risk of losing your money.
Hedging as a way of reducing or eliminating the risk of a
bet may be taken as soon as you are not comfortable that a bet you have made
will win. Let us say, Arsenal are playing Chelsea and you put a bet 12 hours
before the game that Arsenal would win @2.30 using Ksh 200. You are expecting
Ksh 460 if Arsenal wins. What if after seeing the lineups for the two teams you
realize that Arsenal’s team is too weak to beat Chelsea? You can make another
bet to reduce the risk on your first bet, this time using say Ksh 200 to bet on
Chelsea winning @2.40, a possible win of Ksh 480. This way you have reduced the
risk of losing your money should the result not go your way.
Hedging in its most basic form may not appear very useful,
but when used intelligently it can be a really powerful tool for making profit.
For example, you can bet on a game before it starts and then hedge it as the
match is played (what is called in-play or live betting). For instance, if
before a match you backed Manchester United to beat Everton, then after only 20
minutes Everton has hit 2 goals and you don’t see a way back for Manchester
United, you can reduce your losses by putting a live bet on Everton to win the
game. Hedging improves your chance to make a profit, but also helps you to
limit the size of your losses.
What are the limitations of hedging as a betting strategy?
Firstly, you have to act quickly to get the right price for a hedging bet. Unfortunately,
as you rush to get the best odds you may also make mistakes, thinking that you
are protecting yourself while actually exposing yourself and increasing your
potential losses. Secondly, hedging means you are reducing the value you had on
a bet. To hedge a bet means to cut down your risk or loss, which also means you
are reducing your profit margins by putting in more money on the same match.
Generally, however, hedging is not a bad idea as long as you
are aware of when and how to apply it. If you have reason to believe that a bet
you have placed will not win and you want to cut your losses, such as the
favorite team isn’t dominating the match as you expected or the star player is
injured, hedging is a great way to cushion yourself.