Arbing – Some Advanced Techniques
- The TopTrap Greyhound Profit And Loss Account On Betfair - March 17, 2022
- Betfair Best Execution – 11 Requested & Filled At 320 - January 16, 2022
- BTB System e-book - March 13, 2015
This article is designed for people with some experience of arbing. There is no right or wrong way of doing this, and many of these techniques are simply suggestions. You should choose the ones which suit your temperament and ability and ignore the others. For simplicity I have assumed you are using Betfair. Most of these techniques should work on other exchanges too, providing there is the necessary liquidity.
I am assuming that you understand the basics of arbing and that you can place an arb quickly and efficiently. I am also assuming that you thoroughly understand the workings and implications of rule 4, know what I mean by underlaying, and have your Betfair account set to show your P&L and what if figures. If you don’t know what I am talking about you could easily lose money trying these techniques, so please read this article first.
Warning – some of the techniques described in this article are risky. If this is the case, I will say so in the relevant section. Some of the ideas put forward here are quite complicated. Please make sure you understand what is involved with these techniques before you try them, and if in doubt come and ask in the live chat.
Shared liability and saved commission
If you are arbing at all seriously you will soon find that you come across arbs on more than one selection in the same race or event. This is good news, providing that you make sure that you are sensible about how many selections you back at the same bookie. 2 horses in the same race at the same bookie is fine, but backing both sides in a football match is not. On the other hand, at Betfair the more the merrier. There are 2 reasons for this.
1. Shared Liability – when you arb 2 horses in the same race, only one of them can win. Betfair take this into account when calculating your exposure on that event (the amount that they take from your account when you bet). So if you place a £10 lay at 6.0 your exposure will be £50. However if you then lay another horse in the same race for £20 at say 2.2 your exposure will drop to £30. You will still pay out £50 if your original horse wins, and you will pay out £24 if the 2nd horse wins. But you will get back the stake on the losing horse as well. So if horse 1 wins you pay out 50 and get back 20, overall loss at Betfair = 30. If horse 2 wins you pay out 24 and get back 10, overall loss = 14. Your maximum exposure has dropped from £50 to £30. This will show up in the what if figures before you bet and the P&L figures once your bet is placed. Importantly, the extra £20 released by placing the 2nd lay is available to bet with. Arbing more than one horse in a race (or more than one correct score) is an excellent way of increasing your chances of a winning arb while not using large amounts of Betfair balance. If you have run out of money in Betfair, look for arbs on markets where you already have some exposure, and make use of shared liability to free up some money. The amount of money released will be equal to your additional lay stake, providing that the liability on the 2nd lay is at least that much less than the liability you already have.
2. Saved Commission – Betfair charge commission on your winnings on each market, NOT on each individual bet. If you have 2 lays on one race and one of the horses wins, providing the overall P&L figure on the winning horse is red, you will pay no commission on the other one. This means that if you have laid to cover your commission on each horse, the difference between the back and lay stakes on the losing horse will be extra profit. The absolute ideal is to have an arb on every horse, and in small fields this is actually possible occasionally. You may decide, if there is only one horse that you haven’t got, to take a near arb (eg level odds) on that one to create a situation where you win back saved commission regardless of the result. Saved commission forms a large part of the profits from arbing and its value should not be underestimated. Always take a 2nd arb in a race where you already have one, if you can.
Laying extra in running
WARNING – backing before the race and attempting to lay in running to create an arb is worse than pure gambling and will result in large losses on a regular basis, whereas when it works the winnings will be relatively small. This is a certain long term loser and is NOT what this section is about.
Sometimes when you are arbing you will come across a situation where if you underlay you stand to win a large amount if the horse wins, and nothing at all if it loses. This may be because of a very big arb, or because a later non runner has left you with an advantageous situation, or even if there is a big drift in the odds triggering BOG. None of these alter the fact that underlaying is the best strategy to maximize profit, but knowing all that is of no help when your huge arb gets beaten a short head and you win nothing at all. If the arb is at a low price you might consider laying a bit extra to give you a return regardless, but at high odds this is very expensive and less profitable in the long run.
Many arbers treat this situation with total indifference, not bothering about the size of the arb and leaving it to luck because some of the really big arbs will win. However, if you find it very frustrating to have “done all that work for nothing” you may like to consider laying something in running. For example, suppose I have backed a horse at 10 and there is a huge drift, giving me a potential profit of £100. The lay price available won’t give me much profit if I lay any extra, but if I set up a £25 lay at 1.15 to go in play there is a possibility that this lay will match in running. If the horse wins it will cost me £3.75 of my profit, if the horse runs well but just gets beaten, my lay might match and win me £25, if the lay doesn’t match it makes no difference. Of course, the lay will ALWAYS match if the horse wins. 1.15 is only an example as is £25, but the higher the odds and the bigger the stake the more it will cost you every time your big arb wins. I used to use this technique occasionally, and I know other people who have also used it effectively. I will leave the definition of a what qualifies as a “big” arb to your imagination. Note that if you try to place the lay in running when you see your horse running well, you are most likely to either miss the chance (because of the in play delay) or get the thing matched when it wins. Keep bets is a much better option and allows for a consistent strategy rather than a heat of the moment decision.
Board price (BP) arbing
WARNING – at board price (the last 10-15 minutes before a race) prices move very fast. There is a very real risk that the lay price will shoot up leaving you high and dry.
Board price arbing (horses) is completely different from EP (early price) arbing. You cannot do this using the arb finder. Techniques vary, but speed is of the essence. Some people look at the prices using bestbetting and have all their bookies open ready to pounce on one that is slow to cut the odds. Others concentrate on one bookie and watch the odds on Betfair, hoping that they can get the bet on before the bookie cuts. Many bookies give bigger limits at BP, and most of them (but not all) have the same odds – Stan James and Blues Square/888 are ones that don’t.
If you are going to arb at BP you need some sort of software (gruss refresher, Betfair watch window or trading software) to show you up to date Betfair prices, you need to be able to concentrate and therefore be free of interruptions and distractions, and you need a level temperament to enable you to cut losses quickly and calmly when necessary. At least 2 screens and access to the racing channels At The Races (sky 413) and RacingUK (sky 432) are extremely helpful.
Before you even think of attempting BP arbing you should be confident that you can place back and lay bets very quickly. There simply is not time to mess about with spreadsheets – you need to have your lay stake imprinted on your mind so that you can submit both bets in seconds. Underlaying is pretty much essential to allow you to do this quickly. An ability to recognize the signs that a horse is about to shorten helps a lot, as you can load the betslip ready at bookie and Betfair. This comes with experience so you need to watch and learn what to look for.
WARNING – most foreign races are tote odds only and should be avoided because you do not know what price you are getting on the back bet. This section refers to big races with fixed odds only. If you can’t tell the difference, come and ask in the live chat.
Foreign races can be lucrative to arb because the bookies are a lot less sharp at changing the odds, possibly because fewer arbers look at these races. If you know what you are doing you can often get some nice arbs near to the start of the race. Be aware that liquidity can be poor on these races and you may find that for some it simply isn’t worth it. Learn to recognize the types of race which will give you the best chance of an arb – these will be the top races with runners from the UK or Ireland, or with world famous horses running. Selecting these horses, making a note of the best odds available at the bookies, and keeping an eye on them can give you an edge that other arbers may not have.
Be aware that the usual concessions such as double result and BOG may well not apply to foreign races and you also need to check carefully for the presence of reserves. Never assume that a book has been reformed if there is a non runner – ditch the race immediately. Many bookies simply never reform the market, and rule 4s can be wildly different from Betfair reduction factors. If in doubt, don’t bet.
Like anything else, placing large bets on foreign arbs is likely to get your accounts limited. Learn the big races – the Dubai World Cup, the Breeders Cup, the classics, the Arc meeting, and stick to those. Bookies are used to these races and they get a big write up in the racing press. If you place a big bet on an unknown horse in a French handicap race that is a different matter. At this level arbing requires a degree of understanding and common sense.
In play arbing
WARNING – arbing in play is usually extremely risky. This is particularly true of sports like horse racing, boxing, darts and snooker, where the whole complexion of the market can change in seconds. The in play delay at both bookie and Betfair means that the lay price you get may bear no resemblance to what you were trying to take, and getting matched at all can be very difficult.
There are 2 ways to arb in play relatively safely. The first is to stick to arbing at times when the players are not actually playing – golf and test cricket are good examples of sports which have long breaks in play. The same is true of cricket and tennis matches interrupted by the weather, and breaks such as half time.
The second method is to use live TV pictures to identify shorter breaks in play on various sports such as when players are changing ends, or when there is not much happening. Even then you need to be aware that “live” is probably at least 5 seconds behind reality, and sometimes considerably more (I have seen “live” golf pictures that were at least a minute behind Betfair). Choose your sport carefully and don’t bet when a bowler is about to bowl or someone is about to hit the ball. Never forget that the in play delay can cost you dearly if you take a chance with this sort of thing.
If you are serious about in play arbing, it helps if you know something about the sport and to actually enjoy watching it (hours of cricket or golf can be unutterably tedious if you are not interested in the game). You probably need to subscribe to Sky Sports, and remember that until the digital switch over is complete, if the event is on terrestrial TV, analogue pictures are about 3 seconds ahead of digital ones. In play arbing has quite a lot in common with in play trading, and you may like to read some of the trading articles to give you an idea of how the odds may move as the scores change, for example in a tennis or football match.
Each way arbing
WARNING – arbing horses each way requires an understanding of the each way rules on different types of races and what happens if there is a non runner. Getting this wrong can be very expensive indeed.
Before you even think of arbing horses each way, read this article through several times. Make sure you understand the implications of non runners, and that you can tell the difference between a race where each way is safe and one where it is not. Be certain that you know whether you are looking at 1/5 or 1/4 of the odds for a place. If you are in any doubt at all, either leave it alone or come and ask in the live chat.
There is an each way spreadsheet in the library, which can also be accessed from the each way article linked to above.
This is a useful little trick if you find something that is nearly but not quite an arb in a gappy market. This works best in markets which are a day or so ahead, where nothing much is happening. It is best illustrated with an example:
Suppose I find that a bookie has evens on over 2.5 goals in this football match. 1.96 is nearly but not quite an arb for me, but 1.95 is (just). I place a £2 BACK bet in the queue at 1.95:
A short while later (give it a couple of minutes) I might find that money appears either on top of my £2 at 1.95, or in front of it at 1.94. Here the £90 at 1.96 has jumped over my £2 and landed at 1.94
I can now take my arb (this time it was just for demonstration purposes, so I didn’t take the money), and then remove my £2. If the money had landed on top of the £2 I would obviously be taking £2 of my own money from the queue, so I would need to lay £2 more than I needed to match out the arb. DON’T remove your £2 before you lay, as the money will simply move back to the next best price, probably before you can take it:
Obviously there is a small risk that some other arber will come along and pinch “your” lay, including your £2. I have never had this happen, but often these markets are fed by bots, and if you are patient more lay may appear. Not every market behaves like this, so play with the lay first before you place your bet! I have used this trick successfully on HT/FT markets as well as over/under.
Incidentally the above series of screenshots illustrates the Betfair cross matching process rather well. As the £90 lay moves down you see a corresponding back bet (£85) appear at 2.06. when the £90 moves back up the cross matching bet moves back to 2.04 at the same time. Similarly only one of the bets at 1.87 and 2.14 is really there. The money at the other price can be taken, but you could not take both of them and when one disappears so does the other. Cross matching is a complex and somewhat controversial process which Betfair use to attempt to match as many bets as possible. I will do an article about it at some point, but the crucial fact you need to know about it is that cross matching information is not sent via the API. Therefore if you are using API software it may not show all of the money available at each price, and you may find that you think you are first in the queue when in fact you are not.
I cannot stress enough that any techniques I have put forward for arbing are just suggestions based on my own experience. There are doubtless plenty of other methods, markets etc that I haven’t mentioned which can be used for arbing. The best place for discussions about all of this is the live chat, where I am always happy to answer any questions you may have.
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