Buy or Transfer Points? The Ultimate Guide to Points Arbitrage

In the world of travel hacking, “points arbitrage” is like the secret sauce that savvy travelers use to fly in luxury for pennies on the dollar. It often boils down to a strategic decision: should you buy points or transfer points to get that dream first or business class ticket? In this ultimate guide, we’ll demystify points arbitrage without spilling all the trade secrets. You’ll understand the philosophy behind it – and see why Biirdee’s experts excel at this game.

What Is Points Arbitrage, Exactly?

Arbitrage is a fancy word from the finance world meaning buying something low and using it where it’s valued high. Applied to travel: points arbitrage means acquiring miles or points cheaply (or using existing points strategically) and then redeeming them for an expensive flight, thus getting outsized value.

Imagine this: an airline sells 100,000 miles for $1,800 during a promotion. Those 100,000 miles could book a business class ticket that normally costs $5,000. By “trading” cash for miles and then miles for a ticket, you turned $1,800 into a $5,000 flight – that’s points arbitrage in action.

There are two main ways to play this game:

1. Buying Points or Miles outright (usually during sales or with promotions).

2. Transferring Flexible Points (like credit card points) to airline programs when you’re ready to book.

Let’s break down how each works and when each makes sense.

Strategy 1: Buying Points (When Paying Cash Makes Sense)

It might sound crazy to pay money for airline miles, but under the right circumstances it can be brilliant:

• Airline Sales & Bonuses: Many frequent flyer programs periodically sell their miles, often with hefty bonus offers. For example, an airline might offer a 50% bonus – buy 50,000 miles, get 25,000 extra. In some cases, the math works out to buying miles at around 1 to 1.5 cents each.

• The Redemption Side: If that same airline requires 100,000 miles for a ticket that would cost $6,000 in cash, and you acquired those miles for $1,200, you’ve saved 80%. Even after taxes/fees, it’s a huge win.

• Situations to Consider Buying:

  • You’re just shy of the miles needed for an award (e.g., you have 90k, need 100k – buying the difference could be worth it to avoid paying cash).

  • There’s a fantastic sale on miles and you have a clear plan to use them soon on a high-value ticket.

  • You don’t have enough credit card points but want to book a premium cabin – buying miles can effectively let you “buy” a cheaper business/first ticket than paying the airline’s cash price.

Real-World Example: A while back, Avianca LifeMiles (a Star Alliance program) sold miles at around 1.3 cents each during a promotion. A first class ticket on Lufthansa that costs 170,000 LifeMiles (and would be $11,000 in cash) could be obtained by purchasing miles for about $2,210. That’s ~80% off the cash fare. Deals like that are the holy grail of buying miles.

Risks: Buying miles without a plan can be risky. If you stockpile miles, they could devalue (airlines can raise award prices) or you might not find the award seat you want. Think of buying points like buying a perishable item – best if you’re about to use them.

Strategy 2: Transferring Credit Card Points (Leveraging Flexible Currencies)

If you have points with Amex, Chase, Capital One, etc., you can play a different arbitrage game:

• Flexible to Fixed: You’re converting “flexible” bank points into a specific airline’s miles at usually a 1:1 rate (sometimes better if there’s a promo). The arbitrage here is that you earned those bank points through spending or sign-ups, and by transferring them, you’re getting an expensive flight “for free” (aside from taxes).

• When It Shines: Say a round-trip business class to Europe is 120,000 miles via an airline. Those 120,000 miles might be obtainable by transferring credit card points. If you have them, great – you’re turning what could be a $4,000 ticket into a redemption that maybe cost you some foregone cash back or other use of points (which would’ve been far less value).

• Transfer Bonuses: Occasionally, banks offer bonus ratios (e.g., 30% extra) when transferring to certain airlines. That’s pure arbitrage fuel. For instance, if Amex offers a 30% bonus to British Airways Avios and you know a sweet spot that costs 60k Avios, you’d only need to transfer ~47k Amex points. You turned 47k points into a $3,000 flight – an incredible yield per point.

The trick is knowing which airline to transfer to for the best deal. This requires research into award charts and availability. (Or just knowing who to ask – hint: Biirdee’s team lives and breathes this.)

The Art of the Deal: Combining Buy & Transfer Tactics

Sometimes, the ultimate arbitrage is a combination:

• Maybe you transfer 50k Chase points to an airline and then buy an extra 30k miles from that airline to have enough for the redemption. Using both methods can top off your balance efficiently.

• Or consider using one airline’s miles to book a partner airline’s flights. For example, you might buy Alaska Airlines miles to book an Emirates first class flight, because Alaska might charge fewer miles than Emirates’ own program for the same flight. It’s like indirect arbitrage – using one currency where another is expensive.

This is advanced stuff, and the possibilities are endless if you know the loopholes and sweet spots. (We promised not to reveal specific transfer hacks, and we’ll stick to that – but trust us, they’re out there.)

Why Points Arbitrage is Best Left to the Pros

If your head is spinning a bit, that’s normal. Points arbitrage requires keeping track of:

• Dozens of reward program rules and award charts.

• Timely sales and promotions (which are often limited-time and not widely advertised).

• Calculating the cent-per-point value to know if a deal is worth it.

• Ensuring award seat availability before committing money or transfers.

Mess up one element, and you could end up with a bunch of miles you can’t use, or worse, spend more than you needed.

This is precisely why Biirdee’s service is invaluable. We:

• Monitor all the programs – We know when airlines are running sales on miles or when a transfer bonus is live. We jump on opportunities in real time.

• Have a playbook of sweet spots – Our points specialists know, for instance, that booking Airline A’s flights with Airline B’s miles might cost half the miles. These are things you won’t find easily without deep experience.

• Do the math for you – We’ll crunch the numbers to see if buying miles or using your existing points makes more sense for your trip. We’re all about that maximum value.

• Protect you from pitfalls – We won’t let you buy or transfer unless we’re sure you can snag the seat. Our team often holds award seats or has back-up options ready before spending your money or points.

Make Points Arbitrage Work for You

For a traveler, the goal isn’t to become a points wizard overnight – it’s simply to fly better for less. Points arbitrage is a means to that end. And with experts in your corner, you don’t have to worry about the complexity.

Picture this: You tell us you want to fly first class to London. Maybe you don’t have any miles. Maybe you have a bunch of Amex points. Perhaps neither airline you plan to fly has a direct promotion. That’s fine. We might come back to you and say, “Good news – we can buy you some Air France Flying Blue points during their current sale and combine them with a transfer from your Amex. You’ll be in a La Première suite for 80% off the cash price.” That’s the kind of solution we deliver.

Bottom Line: Points arbitrage is about playing the system smartly. Airlines and credit card companies bank on people not using this knowledge. But with Biirdee, you have that knowledge working for you.

Ready to see how far your money (or points) can really go? Fill out our travel interest form with your dream trip, and let’s discuss a strategy. We’ll handle the nitty-gritty of points arbitrage and present you with options that make luxury travel affordable.

Don’t let those first class suites and business class pods fly by empty while you sit in the back. With a little arbitrage, you could be up front – without paying a fortune. Reach out to Biirdee today, and let’s make the math work in your favor.

Interested in maximizing the credit card points you already have? Be sure to check out our guide on How to Leverage Amex, Chase, and Capital One for Luxury Flights