What Does Hedge Mean In Sporting Betting?

There are not many ways in sports betting to guarantee a profit in any given situation, but hedge betting is one of them. You will only occasionally be able to hedge, but when you are able, you should consider the option. The general concept of hedge betting involves betting on the opposite outcome of a previously placed wager once you have noted that you are in a position to profit. Let’s look at the details of this bet type and how and when to do it, although, you can read our more extensive betting guide here.

Hedging your bets in sports betting definition

Hedging a bet is to make an additional wager different from a bet you have already placed, often the opposite, that reduces the risk for loss or guarantees profit. Through hedging, the bettor can profit or reduce their chance of net loss whatever the outcome of the event. This makes hedging about as close to a “sure thing” as you will find in the world of sports betting.

There are many ways to place hedge bets, including futures, parlays and live betting. In hedging a futures bet, you would wager on a different outcome than your original bet while the first wager is still in play. An example would be that you have a futures bet on an NBA team to win the championship and later bet on a different team.

Parlay hedging involves betting on an individual outcome different from one leg in a parlay. This can make it so that you will win either the parlay or the individual bet. Live bet hedging involves wagering on a side to win during the game when you have already placed a bet on the other side.

When should you hedge a bet?

As a rule of thumb, if you can hedge to reduce your risk of loss or guarantee yourself a profit, it is likely the right decision. Of course, there is an argument for holding out on your initial wager, hoping for a more significant payday. However, it would generally be considered the right decision when you can guarantee a profit in sports betting.

For an excellent example of a positive hedge opportunity, let’s look at a futures bet on an MLB team to win the World Series. Perhaps you have bet on the Chicago White Sox at +3000 to win it all and they have made it to the World Series. Say they are playing the Los Angeles Dodgers, and the odds on the now-set matchup for LA to win are -150. You could place a wager on the Dodgers, guaranteeing a significant profit margin regardless of which team wins.

For parlays, a good example is that you have a five-team parlay going. Four of the five teams have already won. By betting on the opposite team to your fifth selection, you will either win the parlay or win the individual bet and can guarantee yourself a profit.

How to hedge a bet   

Now that you understand the concept of hedging, it is vital to grasp precisely how to hedge appropriately. This involves perfecting the math to maximize the profit on your hedge bet. For an easy example, we will consider the hypothetical White Sox vs Dodgers World Series.

Perhaps you bet $100 on the White Sox at +3000 to win the World Series on the futures market. They are now in the Fall Classic, and you stand to win $3,000 if they pull it off. They are playing the Dodgers, who are -150 to win the World Series now that the matchup has been set. Of course, you can let your original bet ride and win $3,000 or lose $100.

Yet you can guarantee yourself some profit by betting on the Dodgers. The maximum profit would be obtained by betting $1,860 on the Dodgers. This way, you will win $1,140 if either team wins. There are other amounts you can bet and still guarantee yourself some profit, yet if you choose to hedge, you would generally attempt to maximize the winnings regardless of the outcome.

Examples of hedging bets

While we have already given some examples to illustrate the general concept of hedging, let’s get into a few more specifics. We’ll talk about the common forms of hedging, including futures, parlay, single-wager and live betting.

Hedging a futures bet

Futures hedging is very common since to hedge you generally need a previous bet to have come to fruition on some level before hedging. A great example is that you have bet on a team to win a championship, and they are now in the championship game. By betting on the team they face, you guarantee yourself a profit. You can opt for the maximum possible profit on either side or try for a more significant profit if one wager comes through while guaranteeing some winnings or at least that you won’t lose money.

The example we have used with the White Sox and Dodgers is an excellent way to illustrate this idea, and this type of scenario could apply to any sport or two teams. This is the most clear example since there are only two outcomes at that point. Yet, you could even hedge at an earlier position, such as if the team you bet on has made the conference finals and only four possible teams can win the championship. Futures betting gives you an excellent opportunity to set up hedging situations, and this is arguably one of the number one reasons to consider hedge betting.

Hedging an individual wager 

You can even hedge a simple individual bet on a game by tracking live odds. Perhaps you have bet on a team, and they are off to a strong start and far more likely to win than their initial odds would indicate. You can now see in-game odds movement and bet on the opposite side at increased odds. Using an optimal number, you can guarantee yourself some profit.

An example would be that you have bet $100 on a +110 NFL team on the money line, say the Las Vegas Raiders, and they get considerably ahead in the game. Now the other side, say the Denver Broncos, is +250. If you bet $60 on the Broncos at +250, you guarantee yourself $50 of profit regardless of which team wins. Of course, you would need to consider whether you believe that your original wager is so likely to win that you’d instead let it ride. Yet, in the case of hedging, you inherently guarantee a profit, which is hard to argue with in many cases.

Hedging using live betting

Hedging using live betting is essentially the same as what we have discussed above with individual wagers. It requires carefully tracking live betting odds movement in sporting events and quickly calculating when, how and if to place a hedge bet. For an example of how to hedge and guarantee yourself a profit, our above individual wager example applies. Yet, there are also scenarios where although you can’t guarantee a profit, you can still reduce your losses.

Let’s use our above example. on a team that gets considerably behind in a game. You’ve bet $100 on the +110 Raiders, but instead of getting off to a hot start, they are losing by a significant margin. The Broncos have now moved to -250 in the live betting lines. You can’t guarantee a profit by hedging, but you can mitigate your losses. By placing a $150 wager on the Broncos, you’ve now bet $250, and the most you can lose is $40. Whereas had you not hedged, you would be sure to lose $100 in the case of a Raiders loss. 

Of course, you must carefully analyze whether you think your original bet has any chance. If the Raiders win, you’ve lost $40 when you could have won $110. Yet, if you are entirely confident that the Raiders will not win, you save yourself $60 in losses by hedging. This is why it is essential to follow the live betting lines and what is occurring in the game closely and make these decisions promptly.

Hedging a parlay bet

Another common way to hedge involves parlays. Let’s say that you have a five-team $100 NBA money line parlay involving the Bulls (+110), Lakers (+150), Knicks (+170), Suns (-140) and Nuggets (-150). The games are staggered, and all teams have played and won except for the Nuggets. If you leave the bet as it is, you stand to win a considerable profit if the Nuggets come through. Yet, if they don’t, you lose your wager and come away empty-handed.

Perhaps the Nuggets are favorites vs. the Utah Jazz, and Utah is a +130 underdog. Since you would have considerable winnings coming in on the five-team parlay, you can bet on the Jazz to win at this point and guarantee yourself a reasonable profit and no chance of a loss. The odds on the original parlay are +3950, meaning you stand to win $3,950 for your $100 wager if the Nuggets win. If you bet $1,760.87 on the Jazz, you guarantee a profit of $2,189.13 regardless of which team wins.

Yes, you have counted yourself out of a possible $3,950 win, but you will come away with over $2,000 in winnings rather than the potential for a $100 loss. This is why it is imperative to consider parlay hedging whenever you have an opportunity. Many bettors would happily take the guaranteed profit in such an instance, yet you must be aware of your chance to hedge and jump on it.