What’s Hedging a Bet? How & When To Hedge in Sports Betting

Even if you’re not very familiar with online sports betting, “hedging your bets” is probably a phrase  you’ve heard before. 

Whether you’re trying to become a better gambler or just want to know a bit more about the inspiration for the phrase, here’s everything you need to know about what a hedge is and how/when to do it effectively. 

What’s Hedging a Bet?

Hedging is the act of mitigating your risk (or financial exposure) on a previous gambling position by making a new bet.

If you’re new to betting online and looking for a less jargony answer, then let’s try this: Hedging is when you make a second bet that neutralizes your first one.

There are more advanced ways to hedge that aren’t necessarily binary and aren’t necessarily defensive. 

But at its most basic, hedging is the act of covering your butt on a bet you’re not feeling great about anymore. When you hear the word “hedge,” think of “zero net risk.”

How To Hedge a Bet

Let’s start with an easy example of a hedge. Imagine the Giants are playing the Cowboys this week, and the Cowboys are seven-point favorites. You bet the Cowboys on Wednesday.

As Sunday gets closer, though, you’re starting to read some news about potential injuries to the Cowboys. Maybe a couple of offensive linemen are questionable to play, and a starting receiver was given two days off of practice because of a previous injury.

If you decide you want to hedge out of your previous bet, you can bet the Giants at +7, thus neutralizing the position of your previous bet. 

Because you own both sides of the NFL point spread market on that particular game, you have no net risk exposure. You can’t lose money. You have bought out, or hedged, your initial position.

That’s a basic hedge. It’s also a defensive action, meaning you’re proactively betting to protect your bankroll from risk.

There are also more offensive hedges which are a bit more advanced. 

For example, let’s say you stuck with that Cowboys -7 bet from earlier. If Dallas is leading 14-3 at halftime, you might peek at the NFL live odds market and see that the Giants are available at +10.5.

If you buy the Giants live in that spot, it’s effectively a hedge because you’re eliminating the theoretical risk of a Dallas collapse and a no-cover. 

Additionally, you would be setting up what we in the sports betting online community call a middle.

Not only have you bet both sides of the same market, but there’s also a middle ground – between Dallas -7 and New York +10.5 – where you could theoretically win both bets.

This is an optimal hedge for bettors – you have zero net risk, and the potential to win both sides of a bet in the NFL spreads market. 

How To Hedge a Futures Bet

One of my betting specialties is engineering a hedge situation by betting a longshot in a championship futures market. 

Here’s a perfect example. Last year, prior to the start of the FCS Playoffs, I identified the Montana State Bobcats as an FCS championship contender because of their friendly path through the playoff bracket. They were priced to win at +2000.

Once I was holding that +2000 ticket and they advanced to the championship game against North Dakota State, I could then bet big on North Dakota State to win. 

Regardless of who won the game, I was guaranteed a big profit because of the hedge position that I had created.

How To Hedge a Parlay

Because a parlay has many legs, it often is much harder to hedge out of a parlay. There is no single bet that counteracts the risk of multiple other bets.

However, it is possible to hedge a parlay once there is only one remaining leg.

An example: this past week, I bet an NFL moneyline parlay combining the Broncos (against the Texans), the Rams (against the Falcons) and the Packers (against the Bears).

Because the Packers were playing after the other two legs on Sunday Night Football, I had the opportunity to bet the Bears’ moneyline and hedge out of my parlay.

I also could have bet Chicago +10.5 and attempted to middle my parlay.

Because I was confident the Packers would win, I didn’t feel such a hedge was a wise use of my bankroll. But if I felt differently, I easily could have bet the other side to cover my outlay.