The Guide to Betting Exchanges
Betting exchanges are likely responsible for the recent shake-ups in the online betting industry, as the onus has now been put on the bookmakers to offer up competitive odds or see their customers flock to the better-priced exchanges.
Betting exchanges, such as Betfair, are a great alternative for punters focused on nothing more than securing the best available odds on anything.
The exchanges work differently than traditional bookmakers in that punters make the odds and punters back the odds with the site merely taking a small commission off each person who successfully matches a bet. You’re betting against each other, rather than the house.
The open market style of the exchange is its driving factor, as nobody is going to take your odds unless they are the best ones on offer. This is why you’ll usually see odds 20% better than traditional bookmakers on the exchanges.
The ability to create or “lay” your own bets was one of the driving forces behind the rapid success of Betfair. If you are laying a wager you are effectively betting against that selection to occur. Anyone who accepts your wager is betting directly against you.
Exchange wagering is most popular in horse racing, football and tennis.
If you had Team A priced at 3.0 and you decide to lay them at that price for £10 you are liable to pay out £30 if Team A wins. Say that, just before kick-off, the teamsheets reveal that Team A’s star players are out injured, their odds will climb up to something like 7.0.
If you back them for £10 at 7.0, you’ll win a total profit of £60. You would still have to pay out the £30 bet that you laid, but your net profit after paying out will still amount to £30.
If Team B wound up winning, you would receive the £10 from the punter who backed your original Team A lay at 3.0- effectively making your bet on Team A to win at 7.0 free.
The advent of betting exchanges created the term “trading” when referring to online wagers. Savvy exchange punters can predict and capitalize on market fluctuations and since you can back and lay odds on the same event, punters can sometimes position their bets so that they will make money regardless of the outcome.
No other betting format provides the punters with so many possibilities for profit. A straight-forward punter can make the same bets they normally would, at greater odds than many bookmakers, or the savvy punter can use the market changes to manipulate his bets, ensuring low risks and guaranteed returns.
If betting exchanges don’t seem right for you, or just want to find out more about your available options, head to our explanation of Asian handicap betting.