Arbing Between Exchanges

Forum discussion from BetSeventyTwo.

Dangers of Arbing Between Exchanges

by abydam » Thu Aug 05, 2010 10:25 am

It’s something that hasn’t really been discussed on here and I was just looking for the advice of experienced arbers and traders.

During the end of last season I was looking for football arbs via oddsmatcher. If I got lucky I might have a 105%+ match every now and again. But with a stake of £50-£100 I’d only make a few quid out of it. By chance, one day I put in Betfair as my bookmaker of choice and WBX as my exchange. On numerous occasions this turned up matches of 110% and ones of up to 122%.

The two obvious limiting factors are the amounts that I’m able to back and lay with at the exchanges. The other factor would obviously be the commission rate at either exchange in the event of a win.

On the plus side it would surely eliminate the chance of being limited.

Unfortunately I’m not aware of all the dangers that might come with arbing football between the exchanges so would definitely like to hear some advice from the more experienced users out there.

by corner123 » Thu Aug 05, 2010 1:50 pm

There are several pitfalls with arbing between exchanges. Commission is certainly one, since you will pay it on one of the bets whatever happens, which means you have to cover for it twice. If you commission rate is 5% at both exchanges, for example, a 5/4.7 arb for a £50 stake which would give a profit of £1.08 between bookie and exchange, will give a loss of 97p if arbed between exchanges.

Nowadays there are bots that compare prices between exchanges, so large differences don’t hang around for very long.

Some exchanges have a lot of spoof money about – it looks as if it is there to take, but as soon as you try it disappears never to be seen again and leaves you high and dry. This used to happen a lot at Betdaq – it may be better there now, I don’t know. There is a serious danger of not getting matched at anything like a reasonable price, if at all at some of the smaller exchanges.

With horses there is another danger. While rule 4 at bookies is fixed depending on the odds, the exchanges all have their own reduction factors, and these may not be the same on different exchanges. You are much less likely to find a favourable rule 4, and more likely to find that with commission factored in to both sides the rule 4 goes against you if there is a non runner.

Personally the only time I would bet between exchanges is if there was a free bet involved which required me to place a back bet to get the free bet. I think trading is a better option – the commission problem is much reduced and the risks are probably similar.

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