In this post I will explain cross-market arbitrage on Betfair, including how to determine whether arbitrage opportunities exist, and how to exploit them by placing bets of the right size.
In general, arbitrage refers to the simultaneous buying and selling of something in different markets, exploiting small price differences to make a profit. On Betfair, it means buying positions that collectively cover all possible outcomes of an event, where the prices guarantee a small but certain profit (here I use price to refer to the decimal odds).
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