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BR - Qualifying Bet 101
Level 3 - WAGMI
This post is a continuation of our introductory guide on bonus rugging. If you have not familiarized yourself with this concept yet, please head over to BR - Bonus Rugging 101 and read that presentation thoroughly prior to proceeding with this text.
Knowledge and understanding of how to approach the different betting offers out there are fundamental for a successful bonus rugging adventure and now the time has come to get to know them better. We will initialize this learning process by discussing qualifying bets today and will return with substacks explaining everything concerning the other two main offers, freebets and risk-free bets.
What is a qualifying bet?
A qualifying bet is a bet placed to fulfill some sort of wagering requirements which are currently restricting the access to your money. For such a bet to be considered valid, it must *qualify* for the relevant terms and conditions, hence the name. Qualifying bets are the most general kinds of bets inside the bonus rugging sphere and they arise in a number of different occasions, examples include:
A bookmaker offers to match your deposit with 100 % up to, say, 500 $, with a minimum turnover requirement of 2 000 $ with odds of at least 1.80 before withdrawals are permitted. In this case your strategy is to place a number of *qualifying bets*, hedged with another bookie, until either the sportsbook balance has been emptied or the wagering requirements have been completed.
An online bookmaker promises that if you lose your first bet with them the full stake will be returned to your account with a condition to wager the money at least once before any balance is withdrawable. This is also known as a risk-free bet since there is ‘no risk’ involved in this offer. If you win you keep your winnings, if you lose your money is *more or less* returned (emphasis on more or less due to the payback rarely being cash equivalent). Either way, if you happen to lose your initial bet you would like to convert the restricted cash into real world dollars, in which case the theory of qualifying bets comes in handy.
Note: Knowing the ins and outs of qualifying bets is not necessarily only of use in bonus rugging. For example bookmakers sometimes apply minimum wagering restrictions (most often 1X size of deposit) when depositing money with them, and if you have deposited a large sum but realise you would want to move the money elsewhere, you can make use of the qualifying bets knowledge to make sure you meet the relevant requirements while avoiding adding any unnecessary risk.
How to hedge a qualifying bet?
Having obtained an understanding of the basics, suppose you are now in the following position. You are betting with an online sportsbook and after having read their terms and conditions, the initial step seems to be a placement of a qualifying bet. Therefore you go on and do this on the website. However, this gives birth to a new problem considering you are now in possession of a risky coupon depending on the result of an uncertain game. How do you effectively hedge this bet/position, i.e. neutralize the position and remove the outcome dependence?
Autist note: Assuming ‘fair’ odds, your EV is in theory unaffected by what you continue to do at this point (in fact, it will drop slightly since we will be paying a small fee to complete our hedge). One could however argue that this is not entirely true since removing the volatility allows one to take on *much* larger positions than otherwise would be possible → total EV in dollar terms goes up.
Case 1 - Betting exchanges available (Europe, Australia, …)
The easy case. You more or less log in to the exchange and lay (offer someone to bet) the same amount of dollars that you have wagered on the given outcome, with some modest adjustments.
Lay betting is essentially betting on something not to happen,
Lay odds – the odds which you are prepared to offer someone wanting to place an ordinary back bet.
Backer’s Stake – the amount you are prepared to let the backer bet with you. This is your potential winnings.
Exposure – (Lay Odds - 1) x (Backer’s Stake). This is the amount you are risking.
The below easy-to-use formula describes exactly how much to lay in order to remove the risk completely from a qualifying bet, i.e. it will guarantee you the same net profit/loss regardless of the game outcome. For the curious ones (*should* be if spending time on this side of the web) the underlying mathematical analysis describing how to arrive at such a formula can be found here.
Case 2 - No betting exchanges available (USA, Canada)
Slightly more complicated. In this case you will need to make use of different bookmakers to place wagers in such a way on the other outcomes that no matter the outcome, the amount of money you win is the same. Assume without loss of generality that you have placed a wager on outcome 1 in a 3-way market with the possible outcomes home win (1), draw (X) and away win (2). How much should you bet on the draw and the away options for the variance to be completely eliminated?
Again we state the formulas and if you are interested in the modeling behind it you visit this PDF.
Autist note: Lay betting and wagering the rest of the outcomes in the ‘right’ proportions are of course equivalent. The formula in case 2 could therefore be used more or less without adjustments utilizing a betting exchange as well, with the odds inputs simply being the best odds offered at your exchange.
Tips and tricks
Always read the relevant rules carefully to avoid wagering money which will not be counted towards wagering requirements. In some special cases bookmakers may even disqualify you from the entire offer if you fail to abide by the terms throughout the whole offer period.
A great heuristic when bonus rugging is to always fancy high odds. In later 101’s we will explain why this is especially important for the other bet types, nevertheless it is often an intelligent decision to choose improbable outcomes even in the case of qualifying bets. Why? Suppose you have 2 000 $ in bonus cash at DraftKings yet 8 000 $ left to wager before the liquidity is accessible. If you wager the 2 000 $ on a 8.00 bet rather than a 3.00 bet, you will (assuming fair odds) on average have to wager only 2750 $ (1/8 * 8000 + 7/8 * 2000) instead of 4 000 $ (1/3 * 8000 + 2/3 * 2000). Since DraftKings collects ~ 4-5 % (a fee embodied in the odds) on every wagered dollar this will increase your expected profits by ~ 50-60 $.
It should however be noted that the net profit/loss is independent of odds size for qualifying bets (not true for freebets and risk-free bets), and consequently it can sometimes be clever to place wagers on odds as low as possible to avoid having to lock up lots of money on the exchange/other bookie you are hedging your bets with. This applies primarily to situations where no matter what your strategy is, you will simply have to continue playing with the site until requirements are fully met, e.g. if your balance is 2 300 $ but there is only 900 $ left to wager until the balance is open for withdrawal.
Having read this brief guide defining what a qualifying bet is and how to hedge it we now expect you to feel confident with this type of BR-bet. As soon as the calculators are up and running on our website, you should now be able to assuredly choose the right one for your purposes and provide it with the correct input. Additionally you should have a great understanding of what the calculator computes and why the output looks the way it does.
Expect more bonus rugging material in the form of similar concise introductions to freebets and risk-free bets soon.
Until next time…
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Disclaimer: None of this is to be deemed legal or financial advice of any kind. These are *opinions* written by an anonymous group of mathematicians who moved into betting.