Hedging Calculator

Leave Original Stake at $100, Original Odds at 2.5, and Hedge Odds at 1.8. Calculate. Hedge Stake is $138.89 and Locked Profit is $11.11. The full two-way hedge sizes the second bet so both resolutions pay the same cash. Formula: hedge = original × originalOdds / hedgeOdds = 100 × 2.5 / 1.8 = 250 / 1.8 = 138.888…, displayed $138.89. If the original wins you collect 100 × 2.5 = $250, pay back nothing extra, and have spent $100 + $138.89, leaving $11.11. If the hedge wins you collect 138.89 × 1.8 = $250.00 (within a cent of rounding) and have spent the same $238.89, leaving the same $11.11. That identity is the lock.

The tool always fully hedges. There is no "cover 50%" slider on this page; that lives on the partial-hedge calculator. If 1.8 is the best available price on the other side and you only want to freeze half the exposure, compute the full $138.89 here and stake $69.44 yourself. Profit then splits: one side keeps more upside, the other can still lose. A full lock is the $11.11 figure, not a compromise.

Hedge Odds must be decimal and must be the price of the mutually exclusive other outcome. On a two-way moneyline that is the opponent. On a three-way soccer market a two-way hedge against "not my original" is a different construction (you may need two opposing bets). This calculator is the two-outcome identity. Feeding a draw price into Hedge Odds while the original is a home-win will not lock the draw.

Original Odds of 2.5 on $100 is a $150 profit if it wins unhedged. Hedging spends $138.89 of that upside to buy the lock. You are paying $138.89 to convert a $150-or-lose-$100 lottery into an $11.11 certain gain. Whether that trade is wise depends on whether 1.8 is a worse price than the true residual probability. The calculator does not know the true probability; it only equalises the two payouts.

If Locked Profit prints negative, the book is too tight: the two prices do not contain enough combined juice for a risk-free gain. Example: original 1.9, hedge 1.9, $100 original → hedge $100 / 1.9 × 1.9 wait, hedge = 100×1.9/1.9 = $100, profit = 190 − 100 − 100 = −$10. You would lock a $10 loss, which is only useful if you must exit a position (a cash-out analogue). The sign of Locked Profit is the arb check.

Hedging is buying the other side of a bet you already hold so that the pair no longer depends on the event. Traders call the same operation a spread that you flatten. Sportsbooks call the customer-facing version "cash out" and keep a slice. This calculator returns the customer-side two-way flatten: the stake that makes original-win and hedge-win produce the same profit, and that profit.

The arithmetic is older than betting exchanges. A 19th-century bookmaker laying a horse at 6-to-4 and then backing it at 5-to-4 with a rival was hedging. Dutching several horses in one race is the multi-way cousin. Arbitrage between two books is hedging executed at the same moment as the original, with both prices still wide enough that Locked Profit is positive. Most hedges a recreational better makes are not arbs; they are late-game insurance after the price has moved and the remaining juice is gone. Expect Locked Profit to be small or negative in that case. You are buying variance reduction, not a gift.

A full hedge is not automatically better than holding. If your original 2.5 is still a value price into a 50% chance, locking $11.11 on $238.89 of outlay is an 4.65% certain return that may be worse than the original EV. If the hedge 1.8 is itself a value price, you may want to hedge more than 100% (i.e. reverse the position). This tool sizes 100% of the original payout. It does not maximise EV. It equalises.

Two-way only. A three-way soccer match, a place-pot, a each-way book, or a futures market with fifteen remaining teams cannot be flattened with one opposing stake. Use the three-way hedge calculator or dutching for those. In-play prices that include a draw column will make a naive two-way hedge leak on the draw.

Limits: no commission (Betfair 2–5% on net winnings would require a larger lay), no push rules, no each-way place terms, no partial cash-out ladder. Locked Profit assumes both bets settle as win/lose and that the displayed decimal odds are the payout multiples including stake. Rounding of $138.89 versus 138.888… can leave a one-cent discrepancy on one side; size to the penny your book allows.

Hedging a held ticket is the two-way flatten: buy the other side so that both resolutions pay the same cash after stakes. Let S be the original stake, O the original decimal odds, and H the hedge decimal odds. The original payout if it wins is S times O, stake included. Equalising requires a hedge stake h that satisfies h times H equals S times O, so h equals S times O divided by H. Locked profit after subtracting both stakes is pi equals S times O minus S minus h, which is the same number if the hedge wins because the hedge then also returns S times O. Nineteenth-century layers already did this with rival books; exchanges later made the opposing stake a button.

The published defaults on this page are an original 100 at 2.50 and a hedge price of 1.80. Then h = 100 × 2.50 / 1.80 = 250 / 1.80 = 138.888…, displayed as 138.89. Locked profit is 250 − 100 − 138.888… = 11.111…, displayed as 11.11. Check both worlds. Original wins: collect 250, have spent 100 plus 138.89, net 11.11. Hedge wins: collect 138.888… × 1.80 = 250 exactly, have spent the same 238.89, net 11.11. Display rounding to the cent is why live hedges should keep the unrounded 138.888… if the book accepts extra decimals, or accept a one-cent mismatch.

A second worked ticket, the one people often quote from related hedge pages, is 100 at 3.50 against a hedge of 1.60. Then h = 100 × 3.50 / 1.60 = 350 / 1.60 = 218.75 exactly. Locked profit is 350 − 100 − 218.75 = 31.25. Both columns lock 31.25 because 218.75 × 1.60 = 350. The algebra is identical; only the prices changed. Profit is positive when H is greater than O divided by (O minus 1). For O = 2.50 that threshold is 1.666…, and 1.80 clears it. For O = 3.50 the threshold is 1.40, and 1.60 still clears it. A hedge of 1.30 on the 3.50 ticket would lock a loss: h ≈ 269.23 and pi ≈ −19.23.

The sign identity is worth writing in one line. Substitute h into the profit: pi = S(O − 1 − O/H) = S(O(1 − 1/H) − 1). Positive lock means the remaining price still contains leftover overlay relative to a Dutch on two sides. Most recreational hedges are not arbitrages. They are late-game insurance after the price has moved and the remaining juice is gone. Expect locked profit to be small or negative in that case. You are buying a reduction in variance, not a gift. A full hedge has no cover slider on this page; half cover belongs on the partial-hedge worksheet.

Assumptions: mutually exclusive outcomes, no push, both stakes filled at the typed decimals, no exchange commission. A total that can push needs a third cash-flow. A last-leg parlay should use remaining payout rather than the original parlay price. Commission on a lay replaces H with an effective net price. The worksheet always fully hedges. It reports hedge stake and locked profit. It does not estimate true probability and it does not tell you to flatten, to hold, or to average down.