The early ‘cash out’ feature has made its way across most of the major bookmakers and on most types of bets.

You can even cash out on many single bets now.  I don’t know why you’d ever want to, but your friendly bookmaker will give you the option: with another clip of the ticket, of course!

The main thing to remember with most bookmaker gimmicks is that they’re generally aimed at the punters with whom they most want to engage: the mugs.  The casual punter who doesn’t know (or probably care) about the concept of long-term value.

As a more serious punter, you should be looking at a consistent approach which, over time, will produce the most value.  As you’re taking a long-term view, the wins and losses (variance) will even out and you’ll be better off.

Let’s look at an example:

Four leg multis on soccer are very popular at the moment, due to the number of “3 out of 4” offers around.  We’ll assume we’ve already nailed our first three legs and have a cash-out offer prior to the last.

Bet: four-leg multi, $100 stake, price $7.30

Situation: 3/3 winners, alive into last leg (Stoke City to defeat Bournemouth)

Last leg: Stoke City $1.60, Draw $4.50, Bournemouth $5.00

Cash-out offer: $440

So your options are as follows:

Option 1, cash out: $440 collect, $340 profit

Option 2, let it ride: win ($730 collect, $630 profit) or lose (zero collect)

Value?

We know that the bookies rate Stoke a $1.60 chance, which equates to a 62.5% chance of winning (1 / 1.6) but we will use 60% to allow for the bookies margin.  So in mathematical terms, and at the bookie’s ratings, your real choice is between $340 cash (option 1), or a 60% chance of $630: $378 (option 2).

There you can see the value the bookies generate when punters elect to cash out.  A totally ‘fair’ cash out offer at their own odds would be $378.  They may have dozens of punters with the same offer: the more that take up the lower $340 amount, the better off they’ll be in a mathematical sense.

The value bet is clearly to let it ride.  As always, the key to value is in the long-term: in that if you were presented with this exact situation many times over, ‘letting it ride’ is clearly the most profitable option.

If you use this calculation each time you’re considering a ‘cash out’ offer from a bookie, you’ll see the value you’re getting (or more accurately, losing) each time.

Rated price

That’s fairly straightforward, however things change if your own ratings are more accurate than the bookmaker’s (which they need to be, if you are to be a successful punter).  For example, you may assess Stoke’s true odds as $1.45, with the associated adjustments to the odds for the draw or the Bournemouth win.  That’ll obviously change the figures and allow you to assess you own true value, rather than the bookmaker’s.

Racing

Nick Aubrey is a former actuary who takes an extremely mathematical approach to his punting.  We’ve spoken to him before on the Betting 360 podcast.

The basic concept of the ‘cash out’ is the same with a racing quaddie as a sports multi, except in a horse race, there’s usually far more outcomes (potential winners).

Nick explains:

“My overriding rule is that it’s all about the price.

“If you think the cash-out amount is better than your expected return (your estimated chance of collect, multiplied by your full payout) then cash out.

“If the last leg is a race field (eg quaddie), then cashing out is equivalent to having a field bet on the last leg.

“So you are betting on every runner, some of which you would never want to back.

“In this circumstance, a hedge (side) bet on those runners which you haven’t taken in your original bet BUT you think have got a chance would be a better strategy.

“The hedge bet(s) could just be to cover your total outlay so that you are profit neutral on these runners, but still can win big on your original bets.”