Glossary

Arbitrage (Arb)

Betting on every possible outcome of an event across different sportsbooks to lock in a profit regardless of the result. Possible when books disagree enough on odds that the combined implied probability falls below 100%.

Book A offers +150 for Team X to miss the playoffs. Book B offers -120 for Team X to make it. Together those imply only ~94% — the 6% gap is your locked profit edge.

American Odds

The standard odds format used by US sportsbooks. Negative numbers show how much you must bet to win $100. Positive numbers show how much you win on a $100 bet.

-110 means bet $110 to profit $100. +130 means bet $100 to profit $130.

Implied Probability

The percentage chance of an outcome that a sportsbook's odds imply. Calculated by converting the American odds to decimal, then dividing 1 by that decimal.

-120 → decimal 1.833 → implied prob = 1/1.833 = 54.5%. +150 → decimal 2.5 → implied prob = 40%.

Overround / Vig / Juice

The sportsbook's built-in margin. When you add up the implied probabilities for all outcomes of a market, they sum to more than 100%. That excess is the vig — how the book makes money. Arbitrage exists when you find two books where adding their best prices sums to less than 100%.

A fair coin flip should be +100 / +100 (50% + 50% = 100%). But a book might offer -110 / -110, implying 52.4% + 52.4% = 104.8% — a 4.8% vig.

Edge

How far the combined implied probability falls below 100%. A higher edge means a larger locked profit as a percentage of your total stake.

If the two sides you're betting imply 94.5% combined, your edge is 5.5%.

Futures Bet

A wager on a long-term outcome — typically a season-long result like a team making the playoffs, winning a division, or claiming a championship. The bet doesn't resolve until the event concludes, often months later.

Betting on the Ducks to make the playoffs in March — the bet resolves when the NHL regular season ends in April.

Maturity Date

The date when a futures bet resolves — when you find out if you won or lost and your payout (if any) is settled. For "make playoffs" bets this is typically the last day of the regular season. For championship bets it's the final game.

Rate of Return (ROR)

Your profit as a percentage of your total stake across both sides of an arb. If you bet $100 total (split across two books) and get back $104.50, your ROR is 4.5%.

Annualized Return

Your ROR scaled up to a full year, assuming you could reinvest continuously. Calculated as: (1 + ROR)^(365 / days to maturity) - 1. A 4.5% ROR on a bet that resolves in 90 days annualizes to roughly 20%.

A 4% arb on an NHL playoff bet posted in February (say 60 days to maturity) annualizes to roughly 27% — which is why futures arbs are so attractive compared to other fixed-return instruments.

Line

The odds set by a sportsbook for a given outcome. "Getting a good line" means finding a sportsbook offering better odds than the market average.

Line Shopping

Checking the same market across multiple sportsbooks to find the best available odds. Essential for arb hunting — the bigger the book disagreement, the larger the potential edge.

Optimal Split

The exact dollar amounts to bet on each side of an arb so that your payout is identical regardless of which outcome wins. Calculated using the decimal odds for each side.

To get equal payout on odds of -120 and +150 with a $100 stake: bet $56.76 on the -120 side and $43.24 on the +150 side.

Book / Sportsbook

A legal platform that accepts sports bets. Different books set independent odds, which creates the pricing gaps arbitrage traders exploit. Common US books: DraftKings, FanDuel, BetMGM, Caesars, PointsBet, FanDuel, Bally's, ESPN Bet.

Action

A placed bet. "Getting action down" means having a live wager on the books.

Push

When a bet results in neither a win nor a loss — your stake is returned. In an arb, a push on one side means you need to check whether the other side also pushed or settled.

Sharp Money

Bets placed by professional or high-volume bettors. When sharp money hits a line, books often quickly adjust their odds — which can open or close arb windows fast.