Having covered handicap arbs last week, we can now move onto the even more esoteric world of inverted middles!
Now these might sound horribly technical, but in practice they simply offer a neat way of designing your own lay bets, at prices sometimes well below those currently available in the open market. You can then often trade them off against back bets on the exchange to lock-in risk-free profits. I personally prefer to use them to establish an optimised starting point for the Lay the Draw strategy on soccer matches, as they reduce my initial opening exposure to a very low liability level.
If you recall with middles, all we were doing was creating a back bet by exploiting a special type of two way arb where the two sides of the arb overlap. The idea was that the derived back bet should present better odds than if you had simply placed a normal bet on the same event through the exchange.
With inverted middles, what we do is similar, in that we again exploit a special sort of two way arb, but this time we create our very own lay bets. Thus we win in all outcomes with the exception of a “gap result” which sits between the two ends of the arb. Which is a complicated way of saying that very often we end up creating something that looks suspiciously like a lay bet.
An example of an inverted middle
Well these things are always easier when you look at a real-world example, so I’ve located an inverted middle on an upcoming Euro 2012 match between Croatia and the Republic of Ireland on 10th June at 7.45pm. There should be quite good liquidity for every game in the tournament, so I’m hoping that a lot of my readers will be able to exploit this particular opportunity.
OK here are the basic bet details:
|Ireland Asian Handicap, 0.25||12Bet or Pinnacle||£100.00||2.14||£19.00|
Now the bit you might find a bit confusing is the bet on Ireland, which is an Asian Handicap bet with a 0.25 offset. This is, in effect, a bet on Ireland to win, but with the added insurance that, in the event of a draw, half the bet will be void and the other half still win.
What this all means is that, provided the match isn’t a draw, we will win £18.75 for a Croatia victory, or £19 for an Irish one. If however the game ends in a tie, we will lose £38. Which effectively equates to a lay bet on the draw of 3.03 (as £38 divided by £18.75 equals 2.03, to which we must add 1 to arrive at our decimal price of 3.03).
Trading Out On Betfair
If I now go on to Betfair, I find that I can back the draw at odds of 3.35, thereby allowing us to secure a risk-free profit.
However, before you get too excited, a back bet of £18 on Betfair will only deliver us a guaranteed profit of between 75 pence (if Croatia win) and £2.19 (if the game does indeed finish level).
So … why bother backing on Betfair? Why not simply use the inverted middle to provide us with a good value lay bet on the match, effectively risking £38 at a lay price of 3.03 to win either £18.75 or £19.
Well, that is a perfectly valid strategy, and consistent with my dearly held value betting principles. However, I would like to suggest an alternative approach.
Anyone used to employing the famous **Lay the Draw strategy on in-play soccer matches, will know that the price of the draw starts to drop steadily from the start of the match until a goal is scored, when the draw’s back price can suddenly be expected to jump. Then you simply back the draw at the higher price to lock-in a risk-free bet, or trade out to ensure a positive outcome irrespective of the result (a technique known as “greening up”).
What I propose to do with the Croatia v Ireland match is create my lay bet on the draw via the inverted middle, then place my Betfair back bet in the usual way when (hopefully) a goal is scored – knowing that I will have locked in a bigger gap between the back and lay prices than would have been possible by laying directly on Betfair.
Thus, if, for instance, the draw backing price were to jump to, say, 6.5, after the first goal, I will be able to lock-in a risk-free outcome of £56.05, in the event the match is eventually tied. In practice, I would probably green up, and trade out for a more modest profit – but the principle is clear. The inverted middle has allowed us to secure a better trading outcome by linking it into the Lay the Draw strategy.
**Finally, if you are unfamiliar with the Lay the Draw approach, you can read all about it and many other ways of making easy money from betting, by downloading my free manual now on earning £1000 per month from betting systems.