We explain how to calculate a hedge bet using the hedge calculator to give you an understanding of the maths behind hedging, and why it’s a beneficial trading strategy. In this article, we will show you how to hedge both back and lay bets to lock in a profit or reduce your risk.
What is hedging
Hedging your bets is a having a betting strategy which involves placing bets on unique final results to your bet to stable a guaranteed profit irrespective of the result, or reduce your danger on a market.
For example, hedge betting can be applied to lessen your threat when the percentages have:
Shortened after a preliminary lay wager
Drifted after a preliminary back wager
This approach will minimize your danger, and decrease your usual exposure.
To assure a profit irrespective of the result hedge betting is viable when the odds have:
Drifted after a preliminary lay wager
Shortened after an initial back wager
Bet high and lay low is the general rule for hedging a guess for an assured profit regardless of the result. Identifying the market movement trend accurately is key, as you may benefit from any hedge bet, whether the odds move up or down.
Now let’s explain to you how to calculate hedge bets using the hedge calculator. You can do that manually as explained below.
How to use the headge calculator
Select either back or lay depending on what your preliminary wager in the market was.
Enter your unique stake and the decimal odds you wager with.
Enter the opposing odds which can be now to be had in your selection.
Enter the commission for the betting change you bet with.
The hedge calculator will then display the quantity you need to lower back or lay to lock in a guaranteed market position, regardless of the result.
You can use the slider to in part hedge a market, permitting you to exchange out handiest a fixed percent of your unique wager.
How to calculate a back to lay hedge bet
To calculate a back to put hedge bet is reasonably simple.
As an instance let’s say you’ve got guess £20 on Leeds United to overcome Burton Albion at odds of 1.55.
During the game, Leeds take an early lead. You recognize they have a poor document of maintaining leads this season so determine you want to hedge your wager with the lay odds now at 1.33.
Calculating how much to lay to your hedge wager
Firstly you want to use the hedge calculator how much you want to lay. The equation could be very simple:
Hedging calculation = (back price * back stake) / current lay odds
For example: (1.55 * 20) / 1.33 = £23.31
So you would need to lay Leeds for £23.31, with a liability of £7.69
Calculating your profit for a back to lay hedge wager
Use the following formula of hedge calculator to calculate your profit if your back bet wins: Profit = (back stake * back odds) – (back stake)
For example: (20 * 1.55) – (7.69) – 20 = £3.31
If your lay bet wins use the following formula: Profit = (lay stake – backers stake)
For example: £23.31 – 20 = 3.31
Now you have got to eliminate the betting exchange commission. This means you’ll have made a £3.24 income with the aid of hedging with the market (2% industry-low fee) regardless of the result.
Note: If you’re hedging your wager between two different operators, as opposed to on one alternate you will want to convert the unique lay odds to consist of the having a bet exchanges fee – discover ways to calculate betting commission into odds – earlier than calculating your lay stake using hedge calculator.
How to calculate a lay to back hedge bet
Using a hedge calculator to calculate a lay to returned hedge bet is also straightforward. As an instance let’s say you have made a £2 hundred lay bet on a horse at odds of 4.9. Your liability is therefore £779.91 – learn how to use a hedge calculator to calculate your lay wager legal responsibility.
Before the off your horse has drifted out to odds of 7.2. The back odds are now tons better as compared to while you positioned your initial lay bet and is therefore ideal for hedging the market.
Calculating how much to back to your hedge wager
To training session your again stake use the subsequent calculation:
Back stake: (lay odds * lay stake) / back odds
For example: (4.9 * 200) / 7.2 = 136.11
So you will now need to back showroom for £136.11.
Calculating your profit for a lay to back hedge bet
Calculating your income if your back wager is successful using hedge calculator can be performed as follows: Profit = (back stake * back odds) – (lay liability) – (back stake)
For example: (136.11 * 7.2) – £779.91 – 136.11 = £63.97
Using hedge calculator to calculate your return if your lay bet wins use the following formula: Profit = (lay stake – backers stake)
For example: £200 – 136.11 = £63.89
Now you have to cast off the betting exchange fee. Therefore you will have made a £62.69 or £62.61 profit by way of hedging with markets (2% industry-low fee) regardless of the result.
Note: If you’re hedging your wager between two specific operators, instead of on one change you will want to transform the authentic lay odds to consist of the making a bet exchanges fee – learn how to calculate betting commission into odds – before calculating your lay stake.
You can either calculate your hedge betting manually with the formulas we’ve provided above or used the Hedge calculator which available on any websites.