Should I hedge my bet: the short version

Weighing both sides of "Should I hedge my bet?" leads to one event. Hedging and arbitrage both mean betting on more than one side of the same event. A hedge does it after a first bet is already placed, to lock in part of a win or cut a loss. Arbitrage does it at the start, across different books whose prices disagree, so that every outcome returns a little more than the total stake. What they share is the arithmetic of splitting stakes between results on opposite sides.

How much to hedge a bet depends on the aim. To guarantee the same return on both sides, divide the first ticket's potential return by the decimal odds of the opposite side, and stake that. To only cover the first stake, bet less. Should I hedge my bet is a question about risk: every hedge pays the book's margin a second time, so a hedge bet strategy used on every ticket slowly costs real money.

Is arbitrage betting allowed? Placing bets on both sides of an event is legal almost everywhere, and is hedge betting legal for the same reason. Books still dislike the practice openly, and does arbitrage betting get you banned is the practical question: accounts that only take arbitrage prices get limited or closed. Is arbitrage betting profitable, then? In small sums and only briefly, until those limits arrive and close the run.

Common questions

What is a hedge bet?

A second bet on the opposite result, placed after a first ticket already stands, to lock in part of a win or reduce a likely loss.

Does hedging every bet cost money?

Yes. Each hedge pays the book's margin a second time, so a habit of hedging every ticket slowly eats into the overall return.

Do books limit accounts that take arbitrage prices?

Yes. Accounts that only take arbitrage prices tend to be limited or closed, which ends most runs while the sums are still small.

How are stakes split in an arbitrage bet?

The budget is divided in proportion to the inverse of each best price, so every possible outcome returns about the same total.