Have you ever made a futures bet that has gained a good amount of value but hasn’t yet hit? Ever made a single-game wager that you’re feeling less confident about than when you first placed it? If you want to guarantee some payout or minimize potential losses, you might be in a position to hedge your bets.
Hedging is the practice of making a bet that contradicts your initial wager so that you bring in at least some amount of money in multiple outcomes. Hedge betting can take several forms, but the principle is the same – sacrificing the upside to mitigate the downside. The practice often helps serious bettors manage their money, especially when it comes to high-value long-term futures, but anyone can benefit from this strategy.
Check out our complete guide on how to hedge a bet and learn more about helpful strategies so you can take back some control over your wagers.
More on How to Hedge a Bet
What Is a Hedge Bet?
Hedging is a strategy that involves placing a bet or bets that are at odds with your initial bet. At best, it allows gamblers to guarantee a profit from any given outcome. At worst, hedging can help mitigate losses so that you’re less in the hole than you might’ve been.
The ease of taking this approach varies given not only the market and odds but also your goals. For instance, if you’ve bet on a team to win a championship, it’s easy to hedge against your bet once they’ve made the championship game. Hedging would become harder mid-season when there are still several teams in contention.
Hedging can also take place to protect yourself when playing high-risk parlays, as you can bet against one specific leg if it seems that individual outcome is going to determine the parlay. This way, you can win some amount of profit whether or not that leg hits.
Examples of Hedging Bets
Hedging might be one of the more complicated sports betting terms, but a few examples should clear things up.
Hedging an Individual Bet
It’s hard to hedge an individual bet before a game starts, but it’s not impossible. If you get in early enough, the odds can change a good bit between the time you place your original wager and the start of the game.
For instance, let’s say you bet on a football game that starts as a pick ’em. The odds are -110 for both teams, and you bet on Team A. However, the market moves, and Team B has +130 odds before kickoff. You initially bet $11 on -110 for Team A and bet $10 on the new +130 line for Team B.
If Team A wins, your initial wager profits $10 and you lose your $10 second wager to break even.
If Team B wins, you lose your initial $11 wager but gain a $13 profit from the second wager to go up $2 total.
By using different wager sizes, you could also potentially play this situation to guarantee a small profit regardless of the outcome.
Hedging Parlay Bets
A multi-leg parlay bet pulls together multiple individual bets and offers you an elevated payout determined by the compounded odds of all of these “legs,” with the stipulation that if a single leg fails to hit, the whole bet loses.
Hedging a parlay is usually best done when the legs happen at different times. Let’s say you’ve made a $10 parlay of three NFL games, one at 1 p.m., one at 4:25 p.m., and Sunday Night Football at 8:20 p.m. For the sake of simplicity, let’s say that all three of these bets have +100 odds, leaving the parlay with +700 odds.
If your first two teams win, you need the third to follow suit for your parlay to hit. Instead of sweating it out, you could hedge by betting $40 on the opponent who now has +100 odds. If your parlay hits, you’ll profit $70 from the initial wager and lose your $40 second wager. If your parlay doesn’t hit, you’ll lose your $10 wager but win $40 from the second wager. Either way, it’s a guaranteed profit of $30.
You can also attempt to hedge a parlay before it even starts if you think you know which leg is the riskiest. Some people take this approach with Same Game Parlays, although those can also be hedged using live betting lines.
Hedging a Futures Bet
Hedging future bets can be lucrative and can be done with various methods. The simplest is the one that takes the most foresight and faith to reach a situation where it’s available; if you bet on a team to win a championship, and they make it all the way to the final game, it’s usually easy to bet against them and secure a profit.
Of course, you could also make smaller hedges against them throughout the postseason, or even the regular season, if you believe that certain games are make-or-break. This strategy is not as much of a guarantee as a championship game-day hedge, but they can work out.
The same can be said of the approach of simply betting on another team to win the same championship. It can be particularly effective mid-season when it seems that a title race is just between two or three teams, but you risk losing both wagers and coming away with no winnings at all.
Live Betting and Hedging
Let’s talk about an example in which you’ve bet $10 on an underdog that started the game out with odds of +500. Imagine that the underdog has pulled ahead and the live odds for the team that was originally favored are now +250. In this case, you can bet $10 on that line to guarantee a profit of $40 if the underdog wins or $15 if the favorite wins.
Now let’s say you bet $20 on a favorite initially, with -200 odds. They go behind early, and the underdog now has live odds of -150. If you bet another $15 on that line, you’ll only lose a net of $10 if the underdog wins or lose a net of $5 if the favorite wins. If you hadn’t placed that second wager and your initial bet loses, you’d be out $20.
To Hedge or Not to Hedge?
There are two broad scenarios in which sports bettors would want to hedge bet; when the value has increased on your initial bet and you want to guarantee a profit, or when things are looking bad and you want to mitigate the amount you could potentially lose.
Let’s talk about when to hedge to guarantee profit. If a team has already come farther than expected, and they’re expected to be knocked out by a superior opponent, it might be time to hedge. Conversely, you can hedge when your team is favored to finish the job; you could bet a relatively small amount on the other team and still make some solid money if they’re underdogs.
One of the best times to hedge to lock in profits is in-game. If you bet on a football team that scores a touchdown on their first drive, the odds could swing enough that you can guarantee a profit right then by betting on the other team.
In terms of betting to mitigate losses, you might want to do so when circumstances change drastically, like a player injury. In this case, you’d want to do so quickly after the news breaks. If you wait too long, the odds might change so that you’re unable to make any money.
Pros of Hedging
- Opportunity to guarantee a profit in certain situations
- Ability to mitigate bad outcomes rather than accepting significant losses
- Helps bankroll management
Cons of Hedging
- Lower potential upside in most situations
- Requires more bankroll than sticking with the initial wager
- Requires you to pay close attention to odds markets, sports news, etc.
Where to Place Hedge Bets
Of course, you can’t hedge if you can’t bet. Let’s take a look at some of the best sports betting sites to make wagers on that you can potentially hedge later if you so desire.
bet365
bet365 is perhaps the world’s biggest online sports betting brand, and now, it’s available in several U.S. states.
With various markets, competitions, bet types, and live odds, this sportsbook allows you to bet on just about anything. In more cases than not, you have a good chance to hedge out if the situation calls for it.
BetMGM
With one of the best loyalty programs in the industry, BetMGM is all about providing value to players.
This operator is also known for offering a broad variety at competitive odds, giving you the ability to place bets on all major and many niche sporting competitions. It has plenty of windows to hedge bets, especially long-term ones.
DraftKings
Originally an operator in the daily fantasy sports space, DraftKings has become one of the biggest names in U.S. legal online sports betting. It has blazed the trail as one of the first to launch in many new betting states and even strikes up official sports betting partnerships with several teams and professional leagues.
This sports betting app consistently offers solid value on big markets like the NFL and NBA and has fast-paced live odds updates, making it a perfect place to get in some hedge bets if you need to do so in-game.
FanDuel
FanDuel is another brand that got started with daily fantasy competitions, and it hasn’t slowed down a bit ever since rolling out its online sports betting site.
The FanDuel platform boasts one of the most user-friendly interfaces in the industry, making it easy not only to place your initial bet but to quickly find and place any bets you need to hedge against your initial wager.
Responsible Gambling & Sports Betting
As is the case with any type of betting, responsible gambling is vital to keep in mind when you’re hedging your bets. It could be argued that even though this strategy is a risk-averse one, the significant amount of money required to put essentially twice as many wagers as usual on a given competition makes this strategy particularly dicey for those struggling with a gambling problem.
The golden rule of problem gambling is that when it stops being fun, step away, and don’t try to “dig yourself out of the hole.” Many online sportsbooks offer responsible gambling tools, such as account timeouts, and limits on session time, wagering, and deposits.
If you or anyone you know might have a gambling addiction, feel free to call 1-800-GAMBLER at any time to reach the National Problem Gambling Helpline for 24/7 support.
Gamblers Anonymous is another great organization. Similar to other “Anonymous” variants, it provides support groups for those struggling with gambling addiction. Lastly, GamTalk is a helpful online resource for users who need support but are too anxious to go in person or simply struggle logistically to fit those meetings into their schedule.
Hedge Betting FAQs
Want more info on hedge betting? Check out these FAQs that clarify some questions you might have on strategies, legality, and more.
How do you hedge a bet?
There are plenty of different hedging strategies, but all of them boil down to one simple concept; placing a bet that is directly contrary to your initial wager to either secure guaranteed profit or decreased losses.
When is the best time to hedge a bet?
While this is far from the only scenario in which you can and should hedge, the best possible time is when you can assure a profit or at least break even from any potential outcome.
What is an example of bet hedging?
If you bet on a team to win the Super Bowl in August, placing $100 on +1000 odds, and they reach the Super Bowl, you could bet on their opponents to guarantee a profit.
Is hedging a bet legal?
Hedging is a legal strategy that’s widespread among experienced and even professional gamblers.
Is hedging a bet worth it?
This answer certainly varies from situation to situation, but in the big picture, hedging is very frequently the best way to go and can provide you with some great guaranteed profits.
Can you lose money when hedging?
You can, both in a gross sense and in terms of opportunity cost. If you hedge against an initial wager that turns out to be successful, you’ve cost yourself a bit of profit even if you do make money. You can also “lose” money with a successful hedge if you’re hedging to minimize losses.
What is the formula for hedging bets?
There are a few different ways to hedge, and each of which will carry its own formula. The most basic formula used to guarantee that you at least break even and make your initial stake back is: hedge stake = original stake / (hedge decimal odds – 1).
If you would like to guarantee a profit, whether that be an equal profit given all outcomes or a larger profit given one outcome compared to others, you can build off of that number, which is a great starting point for new hedge bettors.
What’s the difference between hedge betting and arbitrage betting?
While hedge betting and arbitrage betting are similar in that they sacrifice the upside for the sake of minimizing risk, there are some key differences.
For starters, arbitrage betting generally occurs before the start of an event, while hedging can take place while it’s in progress. Arbitrage is more about looking for discrepancies in odds between sportsbooks, while hedging focuses on the changes in odds as events unfold.
