Betfair Hedging Strategies: Lock in Your Profits

Hedging Strategies on Betfair: Locking in Profits by Covering All Outcomes

Introduction to Hedging on Betfair
Hedging is a popular strategy for traders seeking to secure profits while minimizing exposure by covering multiple outcomes in a market. Unlike single-outcome trades, hedging on Betfair allows traders to adjust positions based on live events, shifting odds, and market sentiment. This article covers the essentials of hedging on Betfair, exploring techniques to manage risk effectively while maintaining flexibility across various sports and betting markets.

What is Hedging on Betfair?

Hedging on Betfair involves placing bets across different outcomes of the same event to secure a guaranteed profit or limit potential losses. This strategy is particularly valuable when odds shift significantly, allowing you to take advantage of favorable positions and lock in profits before the final result.

Betfair’s cashout feature is a straightforward hedging tool that lets you close a position by spreading profit or loss across all possible outcomes. On Traderline, the Trade button functions similarly, with more granular control, allowing traders to hedge by market or by runner at specific odds. By adjusting the hedge button to “Cashout,” traders can spread profits/losses across all runners, while setting it to “Freebet” enables a focus on a single runner, zeroing out other outcomes.

Why Use Hedging?

1. Profit Lock-In

Hedging allows traders to guarantee a profit regardless of the final event result. By covering all potential outcomes, you can create a balanced position and avoid relying on a single result.

2. Risk Management

In volatile markets, hedging minimizes risk by spreading exposure across outcomes. This is particularly useful in events prone to unpredictable shifts, such as tennis or live football matches.

3. Increased Flexibility

Hedging offers flexibility in both pre-game and in-play markets, allowing traders to adapt positions as odds change or new information (e.g., goals, injuries) becomes available.

Key Techniques for Hedging on Betfair

Hedging can be applied in various ways depending on your trading goals, risk tolerance, and market conditions. Here are key techniques:

1. Back and Lay Hedging

The back and lay technique is one of the most straightforward methods for hedging on Betfair.

• Initial Position: Place a back bet on a selection.
• Adjusting with Lay Bet: If the odds shorten, lay the same selection to lock in profit. For example, backing a horse at high odds and laying it when odds drop secures profit by balancing stakes.
• Traderline’s Automatic Hedging Display: Traderline enhances this process by automatically displaying hedging values for all available odds in the market, making it easy for traders to see potential profit or loss adjustments for different outcomes without manual calculations.

2. Dutching for Multi-Outcome Coverage

Dutching involves backing multiple outcomes in a market to guarantee a return. This is commonly used in markets like correct score or tennis set betting.

• Multi-Selection Bets: Spread stakes across possible outcomes to ensure that one winning selection covers the entire stake.
• Calculating Optimal Stakes: Dutching calculators can help determine how much to bet on each outcome to ensure a balanced return regardless of the result.

3. Cross-Market Hedging

This technique involves hedging across related markets, such as backing a team in the match odds market and hedging with a different bet in the goals market.

• Example: Backing Team A in the match odds market and laying in the over/under goals market if odds shift favorably, allowing profit across both outcomes.
• Market Synergy: Cross-market hedging works best when markets are related and odds movements in one market affect the other, allowing for strategic positioning.

Traderline Hedging Tools: Cashout and Freebet Options

Traderline provides three main options for hedging: Cashout and Freebet modes, and also the Trade button. These options allow traders to tailor their hedging based on desired outcomes:

• Cashout Mode: When the hedge button is set to Cashout, profits and losses are split evenly across all runners. This feature, similar to Betfair’s cashout, offers additional control over individual market entries and allows for a clear view of each runner’s impact on your total position. If you have multiple entries in a market, Traderline’s Cashout mode lets you assess precisely how much you stand to win or lose on each runner, providing a detailed picture of your overall exposure and potential gains based on market fluctuations.

• Freebet Mode: Setting the hedge button to Freebet focuses profits on a single runner, zeroing out any gain or loss if other outcomes occur. For example:

  Example - Freebet in Action:
  You place a back bet on Benfica at odds of 2, and the odds drop to 1.8. Confident in Benfica’s current performance but noticing some dangerous attacks from the opponent, you decide to Freebet. If Benfica wins, you profit; if they lose, you break even.

Hedging in Different Markets

Hedging strategies vary depending on the market, and each sport offers unique opportunities for creating secure positions:

Football Market Hedging

Football is well-suited to hedging, with its range of markets and in-play shifts.

• In-Play Hedging: In live football, hedging can be adjusted as the game progresses, taking advantage of goals, red cards, or other events that shift odds.
• Half-Time Adjustments: Football odds often reset at half-time, allowing for profitable hedging before the second half based on the first half’s performance.

Horse Racing Market Hedging

Horse racing’s pre-race odds fluctuations make it ideal for hedging.

• Pre-Race Hedging: Horses with high liquidity and odds movement allow traders to back early and lay once odds shorten closer to the race.
• Covering Multiple Runners: By using the Dutching method, traders can back multiple horses, ensuring a profit if one of the backed runners wins.

Tennis Market Hedging

Tennis hedging benefits from the match’s structured point and set system.

• Game and Set Hedging: Odds swing dramatically in tennis during key points and set breaks. Traders can back a player pre-match and lay them at shorter odds if they take an early lead.
• Break Point Hedging: At break points, odds movements allow for quick hedging, locking in profit during high-stakes moments.

Risk Management Tips for Effective Hedging

While hedging reduces risk, applying additional risk management strategies improves success:

1. Set Clear Profit and Loss Limits

Establish predefined profit and loss levels to exit positions, ensuring controlled outcomes and avoiding overexposure.

2. Use Calculators for Dutching and Cross-Market Hedging

Calculators are valuable for managing stakes in complex hedging strategies, helping ensure returns without needing manual adjustments.

3. Stay Updated with Real-Time Data

Hedging relies on real-time odds changes, so monitor the market consistently to adjust trades as odds shift.

Conclusion

Hedging on Betfair is an effective strategy for locking in profits and minimizing risk by covering multiple outcomes. By applying techniques like back and lay hedging, Dutching, and cross-market coverage, traders can secure returns across diverse markets. Traderline’s hedging options, including Cashout and Freebet, provide additional flexibility, helping traders tailor their approach. Whether in football, horse racing, or tennis, hedging provides a flexible way to profit on Betfair.