What is Hedge Betting?

Hedge betting is placing a second wager to reduce risk or guarantee profit from an original bet. It's most commonly used when your original bet's odds have improved significantly, creating an opportunity to lock in guaranteed profit or minimize potential losses (though almost always at a cost to total expected value).

Classic Example: Super Bowl Futures

Let's say you placed an offseason futures bet on a team to win the Super Bowl at +2000 odds ($100 wins $2,000). Your team makes it to the Super Bowl, and now you can bet their opponent. This creates a hedging opportunity where you can guarantee profit regardless of the outcome.

When to Use Hedge Betting

Three Essential Criteria for Hedging:

1. Clean Opposite Bet Available

   • Super Bowl: Bet the other team to win
   • Player props: Bet the under if you have the over
   • Series bets: Bet the opponent when down to final game

2. Original Odds Have Improved

   • Your +2000 team made the championship
   • Your parlay is down to the last leg
   • Market movement created arbitrage opportunity

3. You have an edge or are willing to forgo expected value

   • Hedging requires a second bet. Unless you believe you have an edge on the hedge bet, it will almost certainly carry negative expected value due to the vig charged by the sports book.
   • Combining the original bet with the negative EV hedge bet would reduce the overall expected value of the event.
   • Since hedging allows you to manage potential outcomes, this may be a cost you're willing to pay.

Difficult Hedging Scenarios:

• MVP races with multiple contenders - Can't hedge all outcomes with one bet
• Multi-way markets - Golf tournaments, racing events
• Correlated parlays - Some outcomes affect others

Three Hedging Strategies Explained

Strategy 1: Maximize Expected Value (No Hedge)

Philosophy: If your hedge bet has negative expected value, hedging will lower your expected value. If you are EV maximizing, you would not hedge.

When to use:

• You don't mind the loss outcome
• You believe in positive EV betting
• The hedge hold is high

Example:

• Original bet: $100 at +2000 (potential $2,100 return)
• Hedge available with a 6% hold
• EV maximized by not hedging
• Risk: Lose entire $100 if original bet fails

Strategy 2: Break-Even Hedge

Philosophy: Hedge just enough to get your original stake back if your first bet loses.

When to use:

• You want to play with "house money"
• Original bet was significant for your bankroll
• Minimize regret while keeping upside

Example:

• Original bet: $100 at +2000 (potential $2,100 return)
• Hedge $150 at -150 to win $100
• Outcome A: Win $1,950 profit ($2,100 - $150 hedge)
• Outcome B: Break even ($100 hedge win - $100 original loss)

Strategy 3: Equal Profit Hedge

Philosophy: Guarantee the same profit regardless of which bet wins.

When to use:

• You want to lock in a profit and exit the bet
• Risk-averse approach
• Guaranteed profit opportunity

Example:

• Original bet: $100 at +2000 (potential $2,100 return)
• Hedge $840 at -150 to win $560
• Outcome A: Win $560 profit ($2,100 - $100 - $840)
• Outcome B: Win $560 profit ($560 - $100)

How to Use This Calculator

1. Enter Original Bet Details

   • Original odds (American format)
   • Original bet amount
   • Status: Still pending

2. Enter Current Hedge Odds

   • Available odds for opposite outcome
   • Must be for clean opposite bet
   • Check multiple sportsbooks for best price

3. Select Your Strategy

   • Maximize EV: See why not hedging might be best
   • Break-even: Calculate minimum hedge needed
   • Equal profit: Find guaranteed profit amount

4. Review Results

   • Hedge bet size needed
   • Profit for each outcome
   • Total expected value
   • Risk vs reward analysis

5. Make Your Decision

   • Compare all three strategies
   • Consider your risk tolerance
   • Factor in bankroll management

Other Hedging Concepts

Partial Hedging

Instead of full break-even or equal profit, hedge a portion:

• Hedge 25% for some protection
• Hedge 50% for balanced approach
• Adjust based on confidence level

Progressive Hedging

For multi-stage bets (playoffs, tournaments):

• Hedge small amounts each round
• Increase hedge as you advance
• Preserve more upside early

Cash Out vs Hedge

• Cash Out: Lock in a profit by allowing the sportsbook to "buy out" a bet.
• Hedging: Lock in a profit by placing a second bet.
• While similar in effect, profit size can be very different based on 1) the offer from the sportsbook and 2) the availability of hedging opportunities.

Middle Opportunities

Sometimes you can win both bets:

• Original: Team -3.5
• Hedge: Opponent +7.5
• Middle: Original team wins by 4-7

Real-World Hedging Examples

NFL Futures Hedge

• Week 1: Bet Lions +5000 to win Super Bowl ($100)
• Super Bowl: Lions vs Chiefs
• Hedge options calculated for guaranteed profit

Parlay Hedge

• 5-team parlay, 4 have won
• Original: $50 to win $1,500
• Last game: Calculate hedge on opposite side

Live Betting Hedge

• Pregame: Team A +200
• Halftime: Team A winning big
• Live hedge: Team B +450

Hedging Best Practices

1. Shop for Best Hedge Odds

   • Check multiple sportsbooks
   • Even -145 vs -150 makes a difference
   • Consider betting exchanges

2. Calculate Before Betting

   • Always use a calculator
   • Understand all outcomes
   • Don't hedge emotionally

3. Keep Records

   • Track hedging decisions
   • Analyze long-term results
   • Learn from patterns

Related Calculators

• Parlay Calculator - Calculate parlay payouts before hedging
• NFL Odds Calculator - Convert odds for comparison
• Sportsbook Hold Calculator - Find lowest vig for hedges
• Cover Probability Calculator - Analyze hedge value