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An Example of A Sports Arbitrage Trade

A recent boxing match between Danny Williams & John McDermott provided the following market conditions between William Hill & Game bookers

 
Danny Williams Gamebookers 1.85
John McDermott William Hill 2.50

This sports arbitrage trade yields a profit of about 6%. This is how:

To win £1000 if Atlanta wins, one has to bet £540.50 at Gamebookers
(£1000 / 1.85 = £540.50) or, alternatively, (£540.50 x 1.85 = £1000)

To win £1000 if Jacksonville wins, one has to bet £400.00 at William Hill
(£1000 / 2.50 = £400.00) or, alternatively, (£400.00 x 2.50 = £1000)

In total, in order to be guaranteed a win of £1000 irrespective of which teams wins,
one has to spend £540.50  + £400  = £940.40

 
The risk-free profit on this trade is £59.60
 

These types of trades appear lots of times each day, everyday

 

 

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