Guide to hedging your sports bets

Guide to hedging your sports bets

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Unless you’ve been living under a rock for the last, say, 80 years or so, you’ve probably heard the term ‘hedging’. In fact, you’ve most likely heard it as ‘hedging your bets’. It’s such a common betting tactic that it has bled into popular culture as an expression everyone knows to mean, cover your behind.

Of course, hedging isn’t exclusive to sports betting, or even gambling as a whole – it’s used widely in finance and investment circles, as well as business, as a risk management strategy. Hedging allows companies and investors to take investment risks without leaving them vulnerable to huge losses. Every day, people engage in hedging by having insurance or medical aid – small regular investments that safeguard against potential enormous costs.

But we’re not here to chat about the stock exchange or your insurance policy; we’re talking about sports betting and how hedging can help you not only become a better bettor but minimise your losses, maximise your wins, and keep your bankroll in the black

Hedging, in a really tiny nutshell, works by placing two (or more) opposing bets on the same event, thereby guaranteeing a win either way. Got it? Great! So it’s simple, then? Well… it’s never entirely straightforward. But don’t worry, it’s not that complicated either.

In essence, hedging is easy: you place a bet, for instance, on both teams in a match. Whichever team wins, you get the returns according to the odds. Your profit is those winnings minus the value of the losing bet placed.

There’s something tremendously exciting about sports betting. When you successfully place a winning bet and collect that cash, it feels awesome; while losing can be crushingly disappointing. On top of that, a losing streak can wreak havoc on your bankroll.

The main reasons why sports bettors opt to hedge their bets are to:

  • guarantee they make a profit on the event
  • mitigate potential losses on a risky bet
  • ‘reverse’ an accidental or poor betting choice.

Let’s take a closer look at each one.

Guaranteed profit

In this case, it’s a simple matter of wanting to have a guaranteed win, regardless of the sporting event’s outcome. When approaching this type of bet, it’s important to pay close attention to the odds and to place bets accordingly. It’s no good placing a hedging wager if winning won’t cover the cost of the losing wager. If you want guaranteed profit, it will take some time and a little mathematics to place the appropriate bets for maximum potential gains.

Mitigating risky bets

The lure of the jackpot is strong, and in sports betting placing a risky bet with long odds but a massive potential payout can be very tempting. However, nobody wants to blow their whole bankroll on one wager, which makes hedging a good risk management strategy in this case. Even if winning the hedging bet doesn’t cover the whole cost of the risky bet, it reduces your risk exposure and protects your bankroll by offsetting some of the loss.

Reversing a bad bet

You didn’t spend enough time on the stats, and you went with your gut; you accidentally clicked on the wrong button; the team you chose carefully has had a sudden rash of injuries… Sometimes, a bet goes bad, for any of a hundred reasons, and you have immediate regret, even before the match happens. Hedging is a great way to mitigate your potential losses when something goes wrong or when the odds change significantly, for whatever reason.

We spend a lot of time on this website discussing strategies and tips to become a better sports bettor – but why bother if you have hedging with its guaranteed wins all the time? Unfortunately, there’s one really obvious downside to hedging: it splits your wager, which can mean smaller losses – and smaller wins. For example, you could have a weekly sports betting budget of R500. If you bet the whole R500 on one team to win a game, your winnings could be big. However, if you hedge your bets and wager R300 on the favourite and R200 on the underdog, your winnings will be calculated on the reduced bet.

Every sports bettor is unique, and each one has methods and strategies that work for them. Some are passionately devoted to hedging, while others steer clear. Figuring out the strategies that work for you, personally, as an individual gambler, is up to you. Hedging is a great way to minimise losses and get guaranteed wins, but it isn’t always the best way to get maximum profit. It’s a trade-off either way, between the potential for big wins and the risk of big losses, versus a guaranteed, but smaller, win. It’s up to you to decide what you’re going to do with that cake.