How this casino hedge its risk?

Discussion in 'Risk Management' started by traderzhangSan, Jul 10, 2010.

  1. if this is an outcome bet and not a FT bet (3 way result) then there is no need to hedge if the action can be balanced

    the odds you posted in american odds format are:

    spain +105
    netherlands -117

    (this is standard 2 way setup and as such the house will profit if they can get the right size action on each side)

    what is typically the case is that the sportsbook will actually be betting on one side of the match. hedging out excess risk can easily be done via larger bookies in other markets, online books or any of the betting exchanges. they will pay some juice and lose a little of their edge but that's merely an insurance premium to the book.

    since this is a local line i'm going to assume you are in the netherlands or some other place which is heavily biased to them.

    the current line (as of 9:40am) for a 2 way result (no draw possible) is

    spain -180
    netherlands +169

    (fyi, the 3way FT line is spain +111, ned +304 and draw +235)

    this line is posted at pretty much the biggest and most reputable online sportsbook in the world (IMO of course). they have a max wager of 200k on this line.

    if your local is reputable and will reliably pay out a large amount (the major issue with sports betting) you have a massive overlay and could make some easy gauranteed money by betting both sides at different venues.

    for the sake of disclosure i'm on spain -163 which i placed a few days ago.. i could hedge this out for a gauranteed profit but it'd be pennies so I'll let it ride.. The octopus is always right, right?
     
    #11     Jul 11, 2010