What is Hedging a Bet?

Hedging a bet is such a commonly used term that we actually use it as a turn of phrase to refer to someone doing something to minimize risk. But, what is hedging a bet in sports betting? It’s exactly the same thing!

A hedge bet in sports is simply a way to minimize the risk of your bet, or even remove the risk completely (guaranteeing a profit).

We’re going to look at some top tips for hedge betting, including when is a good time to hedge a bet, how to hedge bets effectively, and a fully-worked out example of a hedge bet.

What does it mean to hedge your bets in sports betting?

A hedge in sports betting is a bet that minimizes risk. This can be in one of two ways, explained below:

●    Partial Risk Reduction: Here, you make a bet and then when the odds allow, bet against the outcome to minimize the risk of your initial wager. This allows you to make a smaller profit, but eliminate some risk.
●    Total Risk Reduction: This is harder to achieve, but completely removes the risk of losing. You make an initial bet and then bet against it, so that both outcomes of the bet result in a profit or break-even. In order to do this, you’ll have to watch lines carefully and likely bet at two different sportsbooks, or be placing a futures/parlay bet.

When should you hedge a bet?

There are lots of reasons that you might choose to hedge a bet. Below are some of the most common:

●    Uncertainty: If you’re feeling less sure of your bet than when you placed it, then it could be a good time to hedge your bet.
●    Moving Odds: If the odds have shortened dramatically since you placed your bet, then you could hedge your bet and still see a good profit.
●    Winning Parlays: If a leg (or more) of your parlay bet has already won then you could hedge your bet to the value of your stake, to ensure you can only win.

Step-by-Step Process of Hedging a Bet

There are lots of ways to hedge a bet and we’ll get into some of the different types of bets you can hedge shortly. For now, let’s take a look at how to hedge a moneyline bet.

1.    Log in to your favourite online sportsbook and select a betting market of your choice. We’re going to use an NBA game for this example.
2.    Place a moneyline bet on the team you think is most likely to win.
3.    Accept the odds (6/1) and keep an eye on if they fluctuate.
4.    The odds fluctuate! You took 6/1 but the team has shortened to 2/1 before the game.
5.    Use a hedge betting calculator to tell you how much you need to lay the team for. In this case, you made a $10 bet and you need to lay $30.77 to guarantee the biggest profit.

Using Multi-Leg Parlays for Hedging Bets

Parlays are a type of bet that are commonly used in hedge betting. The reason for this is simple, they’re made up of lots of legs.

Often people will hedge the last leg of a parlay to ensure that even if the parlay doesn’t win, they can still potentially cover their stake (i.e. losses). If the final leg of the parlay does come in, then they’ve taken a small cut to their winnings, but have still made a profit.

How to Hedge a Parlay Bet

Hedging a parlay bet works almost exactly the same as hedging a normal moneyline or a futures bet, except it’s actually a little easier!

1.    Start by placing your parlay bet at your chosen sportsbook.
2.    Once you’ve done this, lay the final leg of your parlay bet at a high enough price to cover (or close to cover) the stake of the original bet.
3.    Now, if your whole parlay wins, you’ll make a profit and if it doesn’t you’ll have minimized your losses with that final bet.

Sometimes you have the option to cash out a parlay bet, if you have success in the first leg (or more). This can be a good alternative to hedging your bet, but does rely on your sportsbook having a cash out option and your bet having early success.

Examples of Hedging Bets  

Now that we know what bet hedging is, let’s take a look at an example. We’ll use a futures bet, as these are very commonly used for bet hedging (and we’ve not looked at one yet)!

You want to place a bet on a hockey team to win the league and find great odds of 12/1 about a month ahead of time. You put a bet of $10 on the team to win. As the day approaches, you see the odds on your team shortening and shortening until eventually it’s game day and the odds are just 2/1 for them to win.

This is the perfect opportunity to hedge your bet! You can now lay the team for quite a wide price range, easily covering your stake and making you a profit. If you’re equally confident in both teams, then laying them for £61.54 covers both outcomes more or less equally.