So, I’m posting my first update for this product. Apologies for the slightly delayed update, I’ve been a spot busy and haven’t had the time to run through the tests as I had first intended. However, I have been using the arbitrage software and thought it was worthwhile to post this update.

I’ll start off by saying, I haven’t yet placed any live bets. What I’ve been doing is monitoring the software and looking at the opportunities that are available, looking at the potential profit, the liabilities, the odds, etc, and making notes.

Initially when I started using the software, I thought there were lots of potential arb opportunities.  That is, on a daily basis there were simply hundreds of different bets.  But, as I started looking into them further, I actually found it harder and harder to find the bets that offered what I considered, good value.

Whilst the software may well offer up hundreds of bets, the large majority are bets that I would never place because the liability would be too big, or because the return was next to nothing. Now I’ll say first off, that someone else might take a different point of view. They might be happier with large liabilities, or smaller returns. I however, was trying to find what I considered good value.

So, the first thing I needed to do was filter out the bets I wasn’t interested in, to leave only the good bets. The filtering is very easy to use and very extensive, so it has to be said, it is very quick and is a pleasure to use.

The first filter I set was the Rating. I didn’t see much point in having anything less than 101 as a rating (101 rating means you get a return of 1% on the bet). There is no point in taking bets that offer no profit, so that significantly reduced the list of bets available. The next filter I applied was for the event time.  I didn’t want bets that were further than 1 day away. Some of the bets were coming up for events several days, or even weeks away and I didn’t want to tie up what could have been several hundred pounds, for several days (or weeks), just to make a few pounds profit.  So, I changed the filter to display only bets that were within 24 hours, and that reduced the list further.

Next I decided to filter on the odds. This was because many of the bets had odds that were simply too high (for me). As an example, one football match had back odds of 20 and lay odds of 17.5. If I had placed a £50 bet on the bookie, I would have had to hold £945 at Betfair to cover the liability. All to make a profit of just £4.39! That didn’t strike me as good value, so I wanted to remove these type of bets. After monitoring the range of odds that were coming up, I decided to set a cap of 10. That would still mean I might need up to £500 (for a £50 bet) at the exchange to cover the liability, but it helped filter the results to a more manageable number.

So with those filters set, when I hit the refresh button I started to get what I thought were quality bets. So far, so good. My new list of bets was now much more manageable. However after monitoring the list periodically over the next few days, I noticed the next problem, which I touched on in the initial review. And that is one of liquidity. The bet is restricted in size by how much money is available on the exchange. Most of the bets were coming up with very small amounts – £15.21, £12.91, £25.24, etc, etc. I’ll put this into perspective with some examples.

Bet 1: odds 10/9.2, £12.91 available: Bet £11.00, Lay £12.02, Liability £98.56, profit £0.44.

Bet 2: odds 5/4.7, £22.43 available; Bet £20.00, Lay £21.51, Liability £79.59, profit £0.42

Bet 3: odds 1.91/1.83, £48.65 available; Bet £45, Lay £48.29, Liability £40.08, profit £0.87

So, with small amounts of money available on the exchange, even when each bet ties up between £100-£200, your profit is literally in pence.

Now the amount profit you make is governed by how wide the odds differ, and so the profit can be larger, but even with really wide odds, say if you get 10% profit, if there is only £20 available at the exchange, you still only make £2 on the bet.

Because of this, I didn’t think it was worth while to go through all the effort, just for 40p profit. So I changed the filter one more time, to only show bets where there was more than £50 available at the exchange.

That had a dramatic affect on my list, it filtered out pretty much all the bets. Monitoring for the next few days, most of the time there were only a few bets. Occasionally it might jump up to 20, but they were all they same bet, just with different bookies. Now this was much better as it meant the only bets that were coming up were quality bets that were more worth while taking.

It did have a downside though. For long periods of time, there were simply no bets available. I would sit there clicking the refresh button and no bets would appear. And that is what I see as the problem.  When the bets do appear, they are quality arbs that could provide up to about 10% profit. But you don’t know when they will or won’t appear. Further, you have to have cash stored in various bookies ready to take the bets. If you don’t have money in a particular bookie when a bet appears, there is nothing you can do.

So, at this moment in time, I’ll be honest and say that I have mixed feelings. It is not that it isn’t working, far from it, it is showing many, many arbitrage opportunities. However, if I use my own personal judgement about what is, or is not a good value bet, then there are not as many opportunities.  If I were happy with leaving large (£10,000+) amounts of money spread across the bookies and exchange, it would be different. If I were happy taking bets and making £1 (or less) profit on each one, again I would be happy. But, I am not either of these.

So, where to next. Well, so far I have written this update without having yet placed a live bet as I wanted to post my experiences of the software. But of course it has to be used in vigour, to make it a fair test. Next week I am going to attempt several arb sessions. I will transfer money to a number of bookies, and then try to have several 1 hour sessions, and see how I get on by doing nothing else but clicking that refresh button, and then placing the bets when (if) the arb appears.