If a bookmaker has credited your account with a bonus bet, it is worth understanding what you actually hold. It is not cash. You cannot withdraw it, and in the standard Australian form the stake is not returned if it wins — a $50 bonus bet at $4.00 pays $150, not $200.
Left alone it is worth whatever it happens to return. Hedged, a predictable portion of it becomes real money.
First, the Australian context
Australia banned inducements to open a betting account in May 2019, in every state and territory. Bookmakers cannot offer these to attract new customers, and they cannot be advertised publicly. This guide is not about obtaining one — it is for people who already hold a bonus bet and want to understand what it is worth.
The idea
Place the bonus bet on one side of a two-way market, then back the other side with your own money at a different bookmaker, sized so both outcomes leave you with the same amount. You end up with cash either way.
Because the stake is not returned, the sizing is:
other stake = (bonus odds − 1) × bonus bet ÷ other odds
Worked through
A $50 bonus bet, placed at $4.00, with the other side available at $1.30:
- Other stake = (4.00 − 1) × 50 ÷ 1.30 = $115.38 of your own money
Now check both outcomes:
| Result | Returns | Net |
|---|---|---|
| Bonus bet wins | $150 (stake not returned) | $150 − $115.38 = $34.62 |
| Other side wins | $115.38 × 1.30 = $150 | $150 − $115.38 = $34.62 |
Either way you finish with $34.62 in withdrawable cash from a $50 bonus bet — a conversion rate of about 69%. The missing third is the bookmakers' margin across the two prices, plus the fact the stake never comes back.
What moves the conversion rate
- Longer odds convert better. Because the stake is not returned, a bonus bet at
$1.50is worth very little — most of its return would have been the stake. Higher prices put more of the value into the profit, which is the part you keep. - Closer prices convert better. The smaller the gap between the two sides, the less margin you pay to hedge. This is exactly the hold calculation.
- Exchange commission counts. Betfair quotes before taking its cut of winnings, so a hedge placed there returns less than the screen price suggests.
Things to check before doing this
- Read the terms. Bonus bets frequently carry minimum odds, eligible-market restrictions or expiry dates. A hedge that breaches them converts nothing.
- You need real money at risk. The example above requires $115.38 of your own funds on the other side. That is a genuine outlay, not a paper exercise.
- Mistakes cost real money. Wrong stake, wrong market, or a price that moves between placing the two legs leaves you with an unhedged position rather than a conversion.