How to stake an arbitrage in round numbers
What does betting $490 instead of $493.98 actually cost you?
The exact stakes on an arbitrage come out ugly. Splitting 1,000 dollars across a two-way at these prices wants 493.98 and 506.02, locking 37.35.
Nobody bets 493.98. More precisely: nobody who is not running a tool bets 493.98, which is the problem. Stake precision is one of the cheapest signals a risk desk has, and it costs nothing to read.
What rounding costs
Round to 490 and 500 and the guaranteed profit becomes 35.00 — a cost of 2.35, or 23.5 basis points of turnover.
That is the whole trade, stated. It is a real cost and it is named rather than hidden, because a tool that will not show you the price of its own advice is not one you can check.
Search, don't round
Straight rounding is one point in a small neighbourhood of round-stake combinations, and often not the best one. Pin the leg at the softest book to a clean number — that is the account whose survival the shape protects — then walk the other leg a few steps either way and score each combination by its worst outcome.
Worst outcome, not average. Once stakes are rounded the legs pay differently, and quoting the average would describe a position you do not hold. The guaranteed number is the small one.