Let’s see how good we are at handicapping math. On Wednesday night I laid three stacks of high society on the Ravens at -3 (+110). Late yesterday afternoon, I learned that I may have serious cash-flow issues as a big customer of mine will file chapter 11 and beat me for $1.35mm. So I have no choice to scramble. After a long sleepless night I turned around this morning and hedged my bet by taking the Steelers at +1(-105). Because I like round numbers I bet $31.5k on the Steelers in an attempt to lower my risk. Did I do the right thing?
In this case it was a tough call, was I better just letting the $30k ride? I hedged my bet by taking the Steelers but it was not a perfect hedge, I am still exposed. Please do the math and let me know where I am exposed and by how much.
While this is a fictional scenario, believe me I wouldn’t give a shit about writing on BTSC if I was facing a $1.35mm loss. But a scenario very similar to this actually happened to me a while back, so I know it is possible. If you are unfamiliar with spread betting you may refer back to my recent post for a more thorough explanation, click here: Spread Primer hope you enjoy figuring it out and putting my mind at ease, have fun!
[Note by kk99, 09/11/11 8:42 AM PDT ]
below is the answer to my question, since no one wanted to do the math:)
- Ravens by 4 or more points – my payout is $63k, win $1,500.
- Ravens by 3 points – push Ravens bet ($30k refunded) lose Steelers, lose $31.5k
- Ravens by 2 points – lose both bets and am out $61.5k…. OUCH!
- Ravens 1 point – push Steelers bet but lose Ravens bet, lose $30k.
- Tie game or Steelers win outright – win $61.5k on Steelers, breakeven.