Hedging is used in every kind of situation. It refers to an act of mitigating risk or playing safe. For example, when you plan a camping trip in summer, you don’t know what the climate will be like. So, you pack some winter clothes even if the weather will be warm. This is a kind of hedging, where you are playing safe or staying prepared to handle any kind of situation.
In sports betting, hedging is a kind of insurance. You place an extra bet to cover the potential losses against previous bets. However, it is not recommended to use hedging more often in betting. Below are some scenarios when employing the hedging technique is appropriate and viable.
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When to use a hedging strategy in betting…..
For guaranteed profits
The approach differs even in hedging. Some bettors hedge to get a balanced return in any case, while a few make sure that they cover the initial bet. Every situation is individual, so the hedging decision needs to be made on the accessible data.
For example, for guaranteed returns hedging is possible when you place parlays. A parlay is placed on the 6 football teams for covering the spread. Now, the first 5 teams have covered but the 6th has not. Here you can place a hedge bet against the 6th team in the parlay. If the team covered the parlay, you would win but if it didn’t your hedging bet will win.
For correcting an error
The bad betting decision happens, even with seasoned bettors. If you entered a bad bet then —
- Allow it to ride with the hope it will possibly bring rewards.
- Use hedging to balance the potential losses by wagering on the opposite outcome.
Practice hedging technique along with proper bankroll management to handle the risk.