Hedge Calculator

What is hedging?

Hedging means placing a second bet on the opposite side of your original wager; usually after the situation has changed in your favor; to either lock in guaranteed profit or limit downside.

Classic scenario: live futures

You bet $100 on the Diamondbacks at +5000 to win the World Series before the season. They make the World Series. The Game 7 moneyline on the opposing team is now -150. You can hedge by betting the opposing team; guaranteeing a positive return no matter who wins Game 7.

The math behind it

To equalize profit on both sides:

• hedge_stake = (orig_stake × orig_decimal_odds) / hedge_decimal_odds

This formula sets the total potential return on the hedge equal to the total potential return on the original, after subtracting both stakes.

When to hedge (and when not to)

Hedge when:

• The expected value of letting the bet ride is lower than the locked-in profit (rare but happens with juiced post-event lines).
• You want to reduce variance; especially on large-stake futures or single-event parlays.
• The hedge odds let you lock in any profit and you'd rather take the certainty.

Don't hedge when:

• You're confident the original bet is still +EV.
• The hedge would only minimize loss rather than guarantee profit.
• Variance doesn't bother you and Kelly suggests letting it ride.

Partial hedging

You don't have to hedge the full amount. A common strategy is to hedge enough to recoup your stake; you bet just enough on the other side to break even, and let the rest of the original bet run for free upside.