How to hedge a bet and an accumulator, and when to take the cash-out

What is hedging?

You hold an open bet that has become valuable: an accumulator in which every leg but the last has won, or a single on a team that is leading. A hedge is a second bet that wins when your pick loses. You size its stake so that both scenarios give a result you are happy with, most often the same profit whatever comes in.

The opposite outcome can be:

• one bet: double chance X2 against a home win, under against over, "no" in BTTS,
• several separate bets, when the opposite outcome has several parts, for example the draw and the away win backed separately,
• a lay on a betting exchange: you take the bookmaker's side of your own pick, so the lay wins exactly when your pick loses (Example 4 below).

A hedge creates no edge. It only moves money between scenarios, and on every hedge you pay the bookmaker's margin or the exchange's commission. The calculator shows that cost directly.

The hedge stake formula

Let W be your bet's payout if it wins, S the stake already placed and K the hedge odds. A hedge pays K for every pound staked.

• your pick wins: W − S − H
• the hedge wins: K × H − S − H

The two results are equal when H = W / K. The locked-in result is then W − S − H.

On an exchange you lay your pick at lay odds O, and the exchange takes commission c from your lay winnings. The equal lay stake is W / (O − c), that is back stake × back odds / (lay odds − commission), and what you risk if your pick wins is the liability, lay stake × (O − 1).

A hedge only makes sense when the locked-in result is positive, which means the hedge odds have to be high enough (a lay's odds low enough). The calculator gives this threshold as "A hedge without a loss needs odds of at least…" and, for a lay, "A lay without a loss needs odds of at most…".

How to use the calculator step by step

1. Choose the mode under Picks: From bet list or Free text, as in the dutching calculator.
2. Choose how to hedge: Back the other side with a bookmaker or Exchange lay. For a lay, set the Exchange commission to 0, 2% or 5%: it is charged on lay winnings.
3. Enter your bet: Single (stake, odds and pick) or Accumulator (stake and the list of legs with their status: Won, To play or Void, a void leg counting at odds of 1.00). In list mode you choose every leg from the list of markets: 1X2, double chance, draw no bet, Asian and European handicap, goals, team goals, BTTS or correct score.
4. Enter the hedge odds. In list mode the calculator suggests what to hedge with (more below). In free text you type the name and odds of the opposite outcome, and with Add an outcome you can split the hedge into up to three bets. With a lay you enter the Lay odds.
5. Optionally enter Odds now, the current odds on your pick. Together with the hedge odds, the calculator removes the margin from them and works out the market chance, the expected value (EV) and the fair value of the bet.
6. Choose a strategy and read off how much to stake and on what.
7. Optionally enter a Cash-out offer to compare it with the hedge.

The Examples buttons (Acca: last leg, Live 1X2, Acca: 2 legs left and Exchange lay) fill in the scenarios of this guide. The calculator remembers the mode, the stake rounding, the hedge method and the commission in your browser.

What to hedge with? The calculator picks the bet itself

In From bet list mode you do not have to work out the hedge. The calculator knows how every bet settles on every score, so once you pick your bet it lists under Hedge with all the bets that, together with it, cover every result. For a home win (1) these include:

• X2, the same bet as Asian handicap AH 2 (+0.5) and European handicap EH 2 (+1),
• X + 2, the draw and the away win backed separately,
• AH 2 (+0.75) or AH 2 (+0.25), lines on which some results end in a refund or a half win.

Next to every hedge the calculator shows the odds from which it does not lose ("no loss from odds of"). Once you enter the odds of several options, it picks the one with the best locked-in result and labels it "best". You enter each price once: the odds on X serve both in X + 2 and in any other option with the draw. You can choose another option with a click, and Other hedge: pick bets from the list lets you build a hedge from any bets on the list.

Below the result is the Coverage by score table: each row is a group of scores, with what your bet pays, what the hedge pays and what is left. When a hedge leaves gaps (for example the draw alone against a home win, without the away win), the calculator warns you on how many scores every bet loses. On lines with refunds and half stakes it sizes the hedge so that the worst scenario is as good as possible.

Free text mode is there for markets outside the list, such as the first goalscorer or the league winner. The calculator then assumes that your pick and the hedge exclude each other.

Four hedging strategies

Above the result there are four cards. Each shows the hedge stake and the result in both scenarios, and a click picks the strategy.

• Equal profit: the same result whatever comes in. This is the classic way to "lock in" a bet.
• Stake back: the smallest hedge that returns your whole stake if your pick loses. All the profit stays on the scenario in which your pick wins.
• Maximum hedge: the largest hedge with which you do not lose if your pick wins. All the profit moves to the hedge's side.
• Kelly: the hedge best suited to your bankroll by the Kelly criterion. It needs a chance (from Odds now or your own, under Your chance) and a Bankroll. When the win is small compared with your bankroll, Kelly usually says not to hedge, and when it is large, it suggests a partial hedge.

Between "stake back" and "maximum hedge" lies a band of stakes with no loss in either scenario. On the Result by hedge stake chart it is marked in green. You can drag across the chart to pick any stake in between or type it in the Hedge stake field.

Example 1: an accumulator before the last leg

A £50 slip on four matches from the article on accumulator bets: three legs have won (1.34, 1.30 and 1.40) and Crystal Palace – Nottingham Forest is left, a home win at 1.98. The acca odds are 4.83 and the payout £241.44. The hedge is X2 at 1.80.

A hedge without a loss needs odds of at least 1.26 on X2 here. With stakes rounded to whole pounds, the equal hedge is £134 on X2, for +£57.44 or +£57.20.

How much does certainty cost? The odds of 1.98 on Palace and 1.80 on X2 give a market chance of 47.6%. Without a hedge the slip has an expected value of +£64.97, with an equal hedge +£57.31. You pay about £7.66 for a certain result: the bookmaker's margin on the hedge bet.

Example 2: a 1X2 hedge on two outcomes

A £100 single on the home side at 3.40 (payout £340). The home side leads, its odds have dropped to 1.40, the draw is at 3.80 and the away win at 9.00. You can back the draw and the away win separately:

• £89.48 on X at 3.80,
• £37.78 on 2 at 9.00.

The result is the same in all three scenarios: +£112.74 if the home side wins and +£112.76 on a draw or an away win. The combined odds of the hedge are 2.67. The calculator shows them so that you can compare them with double chance X2 at another bookmaker: if X2 is priced above 2.67, one bet gives more than two.

Example 3: two legs to play, a leg-by-leg hedge

A £10 accumulator on six matches, four of which have won. Still to play are Ajax – Twente (home win at 2.20) and Celtic – Hearts (home win at 2.50). The acca odds are 63.95 and the payout £639.54. When several legs are still open, one bet cannot hedge them all. The calculator then plans a Leg-by-leg hedge: before each match you back the opposite outcome, but only if the earlier legs have won.

With Odds against of 1.70 for the first match and 1.55 for the second, the "equal profit" plan looks like this:

1. Before the Ajax match: £133.49 on the opposite outcome. If Ajax fail to win, you finish on +£83.44.
2. Before the Celtic match: £412.61 on the opposite outcome. If Celtic fail to win, you finish on +£83.45.
3. If both legs win: +£83.44.

The odds for the second match will change before it starts, so enter the current odds and recalculate the plan before every hedge. The "stake back" plan stakes less: £14.29 and £44.17. Every path with a losing leg then ends at zero, and if both legs win, +£571.08 is left.

Example 4: hedging with a lay on an exchange

On a betting exchange you can lay your own pick: you take the bookmaker's side, so one lay covers every result on which your pick loses. Switch the hedge to Exchange lay, choose the commission and enter the Lay odds.

The Exchange lay example: £50 on Newcastle to beat Villa at 6.00 (payout £300). Newcastle are leading, and the exchange lays them at 2.20 with 2% commission.

• Equal profit: lay stake 50 × 6.00 / (2.20 − 0.02) = £137.61, liability 137.61 × 1.20 = £165.13. If Newcastle win you finish on +£84.87, if they do not, the lay pays 137.61 × 0.98 and you finish on +£84.86.
• Stake back: lay £51.03 (liability £61.24). If Newcastle fail to win you get your £50 back, and if they win you are up £188.76.
• Maximum hedge: lay £208.33 (liability £250.00). If Newcastle win you break even, and if they do not you are up £154.16.

A lay without a loss needs odds of at most 5.90 here. The market chance is taken from the lay odds: 1 / 2.20 = 45.5%. Without a hedge the bet is worth +£86.36 on average, with the equal lay +£84.86, so certainty costs £1.50, the commission on the lay winnings. With 0% commission the equal lay would be £136.36 and cost nothing in expected value; at 5% it is £139.53 and locks in +£82.55.

The commission also tells you when a bookmaker's price is better. With 2% commission, a lay at 2.20 locks in as much as backing "Newcastle not to win" at 1.82 (1 + 0.98 / 1.20), so a bookmaker's double chance on the draw or Villa beats the lay only above 1.82. In an accumulator with several legs to play, the lay mode plans one lay per leg in the same way. How backing at a bookmaker and laying at an exchange combine into a surebet is explained in Surebet Monitor's guide to advanced arbitrage strategies.

Cash-out: is the bookmaker's offer fair?

A cash-out is the bookmaker's offer to buy your bet back before it is settled. Once you enter the offer, the calculator shows:

• the fair value: the market chance without the margin times the payout, which is what the bet is worth on average,
• the Cash-out margin: how much the bookmaker keeps compared with the fair value,
• the Chance in the offer: the offer divided by the payout, that is how the bookmaker prices your bet's chance,
• Cash-out = hedge at odds (for a lay, Cash-out = lay at odds): a hedge at those odds would lock in the same as the cash-out. If the market offers better, hedge instead.

In Example 1 the bookmaker offers a £90 cash-out (the Acca: last leg example loads it). The fair value of the slip is £114.97, so the cash-out margin is 21.7% (£24.97), and the offer prices Palace's chance at 37.3% instead of 47.6%. The equal hedge locks in £107.30 (+£57.30 on top of the £50 stake), £17.30 more than the cash-out. The offer equals a hedge at 1.59 on X2, while the market pays 1.80.

The rule behind it is simple: a cash-out beats the hedge only when the bookmaker keeps less on it than the hedge costs you. Here the hedge costs £7.66 of expected value and the cash-out £24.97, so to match the hedge the offer would have to reach £107.30, a cash-out margin of 6.7%. The exchange lay of Example 4 shows the same: a £120 offer against a fair value of £136.36 (a 12.0% margin) is £14.86 worse than the lay and equals a lay at 2.47. A cash-out can be the better choice when its margin is small or when you cannot get a hedge price close to the market. Compare both before you click.

A partial cash-out pays part of the offer now while the rest of the bet keeps running. The slider in the calculator shows the result of any share and compares it with a partial hedge of the same scale. At 50% in Example 1 the partial cash-out gives +£115.72 or −£5.00, and the partial hedge (£67.07 on X2) +£124.37 or +£3.66, better in both scenarios.

Does hedging pay?

A hedge at a bookmaker, with its margin, always lowers the expected value. In Example 1 it costs about £7.66 and in Example 3 about £13.25. On an exchange the cost is the commission: £1.50 in Example 4. The All options table shows this in its EV vs no hedge column.

A hedge makes sense when:

• the potential win is large compared with your bankroll and losing it would really hurt (that is exactly what the Kelly strategy measures),
• the hedge odds are unusually good, for example from an odds boost or an exchange price above what bookmakers offer,
• you rate your pick's chance lower than the market does, because, say, a key player has dropped out. Enter your own chance under Your chance, and the EV and Kelly follow it.

Hedging as a habit means paying the margin twice. How to work out what a tip is worth is covered in our guide to calculating fair odds and in the fair odds calculator.

What to watch out for

• The same settlement rules. The hedge has to cover exactly the outcomes on which your pick loses: the same playing time (usually 90 minutes plus stoppage time), the same rules for extra time and for abandoned matches.
• Refunds spoil a hedge in free text. Lines with a possible refund (Asian handicap 0, draw no bet) add a third scenario that Free text mode does not count. Choose markets without refunds there, or pick the bets from the list, where the calculator settles every score.
• Odds move. In play, the hedge price can drop within seconds. Enter it just before you bet.
• Limits. A bookmaker may not accept the whole hedge stake (more in maximum bet limits), and an exchange may not have enough money waiting at your lay odds. Enter the amount accepted as your own Hedge stake and check the result.
• Cash-out is not guaranteed. The bookmaker can suspend it, for example during a dangerous attack.

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