Unviable Arbitrage Bet: Louisville Cardinals vs Eastern Kentucky Colonels (ROI: 16.7%)
Introduction
In the dynamic world of sports betting, particularly within the basketball sector, a potential arbitrage betting opportunity has been identified for the upcoming game between the Louisville Cardinals and the Eastern Kentucky Colonels scheduled for December 28, 2024. This memo provides an objective analysis of this betting scenario to assess its viability.
Analysis
The betting scenario involves two separate wagers placed on the head-to-head (moneyline) market with different bookmakers:
Bet 1:
- Bookmaker: BetMGM
- Outcome: Eastern Kentucky Colonels to win
- Odds: +100 (Decimal odds of 2.00)
- Stake: $583.33
Bet 2:
- Bookmaker: DraftKings
- Outcome: Louisville Cardinals to win
- Odds: -180 (Decimal odds approximately 1.5556)
- Stake: $416.67
The total amount staked across both bets is $1,000.
Potential Returns:
For Bet 1 (Eastern Kentucky Colonels):
- Potential Return = $583.33 x 2.00 = $1,166.66
- Potential Profit = $1,166.66 - $583.33 = $583.33
For Bet 2 (Louisville Cardinals):
- Potential Return = $416.67 x 1.5556 ≈ $648.15
- Potential Profit = $648.15 - $416.67 ≈ $231.48
Discussion
Arbitrage betting aims to capitalize on differing odds from various bookmakers to secure a profit regardless of the event outcome. In this scenario, the potential outcomes vary significantly:
Scenario 1: Eastern Kentucky Colonels Win
- Total Return = $1,166.66
- Net Profit = $1,166.66 - $1,000 = $166.66 gain
Scenario 2: Louisville Cardinals Win
- Total Return = $648.15
- Net Profit = $648.15 - $1,000 = -$351.85 loss
The asymmetry in potential profits indicates a risk of substantial loss if the Louisville Cardinals win. Additionally, calculating the implied probabilities:
Eastern Kentucky Colonels (+100):
- Implied Probability = 100 / (100 + 100) = 50%
Louisville Cardinals (-180):
- Implied Probability = 180 / (180 + 100) ≈ 64.29%
The total implied probability adds up to approximately 114.29%, exceeding 100%. This overround suggests that the bookmakers' margins are high, reducing the feasibility of an arbitrage opportunity.
Conclusion
Considering the potential for a significant loss in one of the scenarios and the high combined implied probabilities, this betting situation does not constitute a risk-free arbitrage betting opportunity. The imbalance in outcomes and the bookmakers' overround make this strategy unfavorable under the current odds.
Disclaimer
This analysis is provided for informational and educational purposes within the context of sports betting and arbitrage betting. It does not serve as betting advice or a recommendation. Betting involves risks, and individuals should exercise caution and ensure compliance with local laws and regulations.