Betting the Fanduel promo alone carries risk, you’re right. But you can de-risk it by taking the opposite side of the market and hedging your bet on a different, so that the worst case is 0 loss and best case is a free $1000 bet. You can then arbitrage that $1000 free bet again for a roughly $1000 gain (see this oddsjam link for potential markets to convert free bet into cash, basically markets with low to no vig).
You can actually go further than that by optimally sizing your hedge bet such that your payout is the same regardless of which side of the bet wins. If you’re interested I can copy my optimal hedge bet sizing excel calculator into sheets (and clean it up so that it’s understandable to other people, lol) and share it with you.
Why is it optimal to size the hedge bet such that you get the same payout for either outcome? Why does that have greater EV than if the bets are skewed in either direction?
EV is the same, you’re just reducing volatility (risk is maybe a better word?) by guaranteeing the outcome either way. A downside is that the hedge does increase the necessary bankroll. That said EV does vary with how long the odds are.
Betting the Fanduel promo alone carries risk, you’re right. But you can de-risk it by taking the opposite side of the market and hedging your bet on a different, so that the worst case is 0 loss and best case is a free $1000 bet. You can then arbitrage that $1000 free bet again for a roughly $1000 gain (see this oddsjam link for potential markets to convert free bet into cash, basically markets with low to no vig).
You can actually go further than that by optimally sizing your hedge bet such that your payout is the same regardless of which side of the bet wins. If you’re interested I can copy my optimal hedge bet sizing excel calculator into sheets (and clean it up so that it’s understandable to other people, lol) and share it with you.
Why is it optimal to size the hedge bet such that you get the same payout for either outcome? Why does that have greater EV than if the bets are skewed in either direction?
EV is the same, you’re just reducing volatility (risk is maybe a better word?) by guaranteeing the outcome either way. A downside is that the hedge does increase the necessary bankroll. That said EV does vary with how long the odds are.
Oh, I see. Yes, this is what I thought—the EV doesn’t change but you can reduce your exposure to particular outcomes.