Hedge Dutch and Spread Betting
There are a whole host of hedging practices, but one of the most basic occurs in horse racing. The player will “hedge” their bets by staking the favorite horse, and them betting in the very same horse to both place and show. Just this simple procedure vastly increases your chances of winning. Obviously if the favorite wins there will be a reward; but if the horse comes first or second the player will not have lost all their money, and though the win will not be as great, they wont have lost out.
Some numerical examples will help make this point: Imagine backing a horse with a stake of £18. Instead of placing the whole amount of money on the horse to come first, the player might be wise to split the money up as has just been stated above: putting just £2 on it to win, £4 to place, and the remainder of £12 for it to show. Now let us say the win, place and show results are £10.20, £5.30 and £4.00 respectively. A win would yield £44.80, with second position giving £34.60, and third giving £24. As can clearly be seen a profit has been made. Of course had the player placed all their money on the horse to come first they would have earned far more - £91.80 to be exact. But the risks would have been far greater, and it is far more likely they would have lost everything. By “hedging” their bets the player has protected themselves, even if the cost is a loss in the maximum the profit they can yield.
There are countless methods of hedge betting, but another popular variant is known as Dutch Betting. By this process the player doesn’t bet in a single horse to win – instead they place bets on the pair of top ranked horses with stakes in proportion to their odds. This method ensures that regardless which of these two horses win (assuming one of them does of course!) the prizes will be roughly the same. If the player has £18 pounds with which to wager, and the two top ranked horses are 4 to one and five to one, placing £10 on the first and £8 on the second will guarantee roughly equal wins from both: respectively £50 and £48. The Dutch betting method has made the winnings yielded by the two highest ranking horses approximately the same.
It is not just sports with multiple competitors that permit hedging – even football betting can benefit from this practice. All that needs to be done is to bet on the favorite team to win, and employ the dutch on a draw. This tactic will offer some protection for the lesser team managing to perform better than expected.
Yet another tactic the player can utilize, in effort to skew the odds in their favor, is something called spread betting or Asian handicaps. The theory works by taking advantage of the different odds provided by different bookmakers. Perhaps one bookmaker has Chelsea predicted to win their next match by two goals, while another bookmaker has them projected to win by one goal. By placing a £10 bet against Chelsea to win at the first bookmakers, and backing them with £10 bet at the second both of the bets will win if Chelsea has a one goal victory. The only deficit incurred by any other result will simply be that of the bookmaker’s commisionary charge.
Another method of Hedge betting is employed during “in running” live bets. Before the race has begun the player must back the favorite. Once the match is underway, and the favorite predictably pulls into the lead the odds on the underdog will discernibly rise. At this point the player should make a small hedge bet on this lesser contestant, thus protecting himself if the favorite for some reason falters.
