Consider this scenario: you bet 5 single Wins at £1.00 each where the Odds average 1.80, and then cover those bets with a 5-bet hedge on the Draw option at Odds of 3.10. Now, in the event of all 5 Wins coming in you will gain £4.00 on those Wins, which must then be offset by all the stakes laid out on the Draws. If you had been silly enough to put £1.00 on each Draw bet, then you would now be £1.00 down having achieved the 5 Outright Wins, which will certainly not be what you intended! But there is a solution to avoid this problem, albeit a little complicated:
We consider that the above method of computing the Draw Stakes is not the most appropriate approach (although some others like it), because we would prefer to see the situation break even should the Home Win fail to come in. It is possible to do this using the following formula, the output of which is the value of the stake that has to be laid out on the Draw:
Draw Stake = Win Stake / (Draw Odds -1).
Taking the above situation, the Draw Stake would be £4.76 (10.00 / (3.10 - 1)). The total stakes would then be £14.76, and the gross return from the Draw would also be £14.76 (4.76 x 3.10). Note, however, that should the Home Win succeed, the net earnings will definitely not match the 40% gain we were considering earlier. The actual return would in fact be only £3.24 (£18.00 - £14.76), meaning a gain of only 32% on the Home Win layout and a 22% return on the whole layout. Ultimately, it is up to the individual Bettor to assess the risks as he/she sees them and then to hedge as he/she sees best.