Hedging
Placing a bet on the opposite side of an existing wager to guarantee profit or minimize loss.
Hedging involves betting against your original position to lock in a guaranteed profit or limit potential losses. It's most common with futures bets or parlays when you're one leg away from a big payout.
The decision to hedge is ultimately a risk management choice. Mathematically, if your original bet still has positive expected value, hedging reduces your EV. But it also reduces your variance, which can be worth it for large sums.
A useful framework: if the potential loss from not hedging would significantly impact your bankroll or lifestyle, hedging is a smart move regardless of the math. Protecting your bankroll is always priority number one.
Example
You have a $100 futures bet on the Eagles at +2000 to win the Super Bowl. They make the Super Bowl. You can hedge by betting the opponent to guarantee profit either way.
Related Terms
Futures
Long-term bets on events that will be decided in the future, like championship winners.
Parlay
A single bet combining two or more selections where all must win for the bet to pay out.
Bankroll Management
The practice of managing your gambling funds to minimize the risk of going broke.
Arbitrage (Arb)
Betting both sides of a market at different sportsbooks to guarantee a profit regardless of outcome.
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