What is the difference between spread betting and arbitrage?
Looking for a more detailed ‘betting for dummies’ type of answer, please.
Spread betting is not betting on a simple outcome, a win or a loss, but the degree/margin of the result. Thus you are not content to say that team A will beat team B but that it will do so by more than one point and you would win more if the result were more in your favour but lose more if it went the other way. Sometimes then it is an open ended bet at one end because in theory there is no limit to how many points might be scored although there is a limit at the other end, nought.
Arbitrage arises when your bet looks to be on the way to being successful and you sell your position to someone else for a profit rather than see out the result to a finish – example, if prices are going up, buy at 10 and sell at 12 or if going down sell at 12 then buy at 10.
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arbitration is the difference of an agreement and spread betting is open choice.
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Spread betting is not betting on a simple outcome, a win or a loss, but the degree/margin of the result. Thus you are not content to say that team A will beat team B but that it will do so by more than one point and you would win more if the result were more in your favour but lose more if it went the other way. Sometimes then it is an open ended bet at one end because in theory there is no limit to how many points might be scored although there is a limit at the other end, nought.
Arbitrage arises when your bet looks to be on the way to being successful and you sell your position to someone else for a profit rather than see out the result to a finish – example, if prices are going up, buy at 10 and sell at 12 or if going down sell at 12 then buy at 10.
References :
spread betting is where returns are calculated in proportion to how right or wrong the bet is. sorry theres no real easy way to explain that.
arbitrage is where all selections can be backed and a profit is guaranteed. simple ex ample is a tennis match say between player a and player b. after comparing prices from different bookmakers, i have found that the largest price available for a is 11/10 abd the largest for b is also 11/10. therefore i could bet £10 on both and would walk away with a profit whatever the outcome. this rarely happens though and i tend to see it more in betlive events
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hope this was easy to understand