What Does It Mean To Hedge A Bet
Sep 11, 2007 You bet 100 to win 1,000 on a 4 team parlay, the first 3 win, and you decide to hedge the last game. The last game is Miami vs Philly and the line is the same as when you bet it, Philly is -3. The Hedging Technique: A Betting Strategy for Risk Management It’s likely that you’ve used the phrase “hedging your bets” at some point in your life. At the very least you’ve surely heard the phrase before, or some version of it. This is a widely used phrase, and not just in the context of sports betting. Hedge Your Bets Meaning Definition: Choose or support more than one option at a time in an effort to reduce the chance of losing. Origin of Hedge Your Bets The word hedge means to avoid making a definitive commitment. Hedging a bet is a strategy that involves placing bets subsequent to an original wager. In almost all cases, a “hedge” is in direct opposition to one’s original wager. Hedging can be done in a multitude of ways and by implementing different strategies, but the idea is always the same. Hedge betting is a sports betting strategy that most bettors are at least vaguely aware of. This doesn’t mean that they all fully understand how to use it effectively or that they know why and when they should consider hedging a bet. As a result, the strategy is often used incorrectly or for the wrong reasons.
If you think winning a 10-team parlay is a dream come true for most bettors, you would be spot on. However, the chances of that happening are slim to none, making it not a very realistic goal for serious bettors to reach. The dream scenario for most bettors is to find themselves in a position where they are guaranteed a profit regardless of what actually happens in a game they bet on. When a bettor has a chance to 'hedge' their bets and turn a profit, they can consider the time spent handicapping well worth the investment.
What Does It Mean to Hedge a Bet?
When you hear someone use the phrase 'hedging a bet,' they are referring one of two definitions. The first is a situation where a bettor would cover their tracks and place a wager on the opposite team in order to limit how exposed they are in a particular game. Let's jump right into an example to help explain.
Let's say you decide to bet the NBA's Bucks at -140 on the moneyline but during pre-game warmups, Giannis Antetokounmpo suffers an ankle injury and is no longer able to play. Instead of letting your original bet play out and test your luck with the likes of the Bucks' supporting cast, you would bet on their opponent, the Raptors, at +130 for the same amount as your original bet. So now you're left with a win-win situation, in which the only risk you have is the vig on your bet .
What Does It Mean To Hedge A Bet For A
Why Would a Bettor Hedge a Bet?
When you make a bet of any kind, you are exposed. You are exposed to the potential loss of the amount that you have wagered on one or multiple games. But this is what gambling is - it's exposing your bankroll in order to see a return on your investment. However, situations do arise where a bettor is no longer comfortable with how exposed they are on a certain game. Something about the game has changed - perhaps the weather has worsened, or maybe a key player has been injured in the pregame warmup. Maybe you bet early and since placing your bet the coach has been fired or there has been a suspension handed out or there were travel issues. Whatever the case may be, a bettor will hedge their bet in order to limit the damage to their bankroll should things go sour between the time they place the bet and the time the game actually starts. This is damage control.
What Does It Mean To Hedge A Bet Show
The second definition of 'hedging' is a situation where a bettor can guarantee themselves a profit. This is done almost exclusively when a bettor has a solid future bet in place that has the potential to win. Let's say, for example, you bet $100 on the Los Angeles Dodgers to win the World Series at 12/1 before the season started. If the Dodgers make the World Series, you have two options. You could let your $100 bet ride and stand to win $1200 or you can bet on their opponent, the Red Sox, at +150 to win the Series. Let's say you bet $600 on the Red Sox and if they win, you would win $900 and lose the original $100 you bet on the Dodgers for a profit of $800. If the Dodgers were to pull off the victory, you would lose that $600 bet on the Sox, but make $1200, for a profit of $600. This is a perfect scenario where you can ensure yourself a small profit rather than nothing at all.
Advantages and Disadvantages of Hedging
Both the advantages and disadvantages of hedging your bet is really straight-forward. The main advantage of this strategy is that it offers the bettor a great deal of flexibility in managing the level of risk you are exposed to. If you are extremely close to landing a big payout via parlay, hedging affords you the opportunity to play it safe and ensure a profit is guaranteed. Furthermore, if you stand to make a loss on a wager and no longer want that exposure, you can hedge and reduce the number of units that will be lost.
The disadvantages of hedging are kind of hidden in the fact that just because you have the ability to reduce a potential loss, you are still guaranteed to take that loss. Just because you hedge and take a small win, you are still sacrificing the potential profit from the original wager. Using hedging to guarantee profits also has an associated cost as you are effectively paying a premium from your potential profits to cover the other side of your wagers.
How to Hedge a Parlay Bet
If you are a parlay player, there is a scenario where 'hedging' could be used to lock in a profit at the tail end of a parlay. Let's say you bet a five-team parlay and the first four games have won. Instead of sweating out that final west-coast game between the A's and Mariners, you could simply make a bet on the other team in the final game of your parlay. By making an aggressive enough bet, you could make it so that your winnings would be the same regardless of the actual result. If the payout of your original parlay isn't large enough to consider 'hedging your bet', then you have to wonder if this kind of bet is a bet you should have made in the first place, given what we know about true odds.
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