What is the difference between sports betting exchanges and traditional bookmakers? Are they good for arbers?
In this article I would try to give the answers to these and some other questions concerning betting exchanges.
What is a betting exchange?
Sports betting exchange is an alternative to bookmaker, but in this case, gamblers are betting each other, not against the bookie. The exchange itself appears to be a platform for betting and charges a certain winnings commision for its services.
It’s worth noting that you can not only accept offers of other gamblers, but form the odds for yourself on the particular market and offer a wager to other bettors.
Back and Lay betting
All bets at the exchange are divided into Back and Lay bets (back and lay betting). The bet will identify you as a bookmaker or a bettor in the certain wager.
Back bets are pretty easy. You accept the odds and a maximum bet on a certain outcome of some other gambler. Then, if your bet pays off, you get a win as at any other bookmaker (but including exchange commision). Moreover, you can offer your odds on the outcome, and if someone accepts them, you’d make a wager. And then everything goes the same way.
It gets a little tricky when it comes to Lay bets. You take on the place of a bookmaker, if you bet Lay odds. Thus, you have certain obligations to the gambler which has taken the offer (if your bet is lost).
Let’s imagine Ingolstadt-Werder Bremen match, and you bet €150 on @2.3 against Ingolstadt.
It means that you accept the bet and the bettor with the same odds and risk losing €136.5, since, in case of Ingolstadt wins, you’d have to pay him €241 (105*2.3). And these €136.5 you’re risking to lose are called obligations.
If the match ends in a draw or Werder Bremen wins, you get the sum of your obligations (€136.5) + the stake of the other bettor (€105) = €241.5.
To put it simply, betting against Ingolstadt, you kind of betting on a draw or win of Werder on odds which are simply calculated by the formula х/(х-1), where x is for Lay odds.
Arbs with betting exchanges
As of today, there are not so many sports betting exchanges, where the most popular are Betfair, Betdaq, Matchbook and Smarkets.
The main one in this list is Betfair as it has obtained quite extensive popularity among thousands of bettors all over the world. It’s actively used for arbing as it has certain advantages like:
- High odds because of the absence of margin which exists at every bookmaker.
- No cutting limits. The exchange does not put any maximums. Everything depends on the availability of a player who is ready to accept your wager on maximum stake.
- Opportunity to form the odds for yourself, that is to take the part of the bookmaker.
All these benefits make betting exchanges appealing to arbers, and the largest (Betfair, Betdaq, Matchbook and Smarkets) are already on the list of arbitrage scanners.
It’s worth mentioning that bets like 1X, 12 and X2 are very common for arbs with exchanges. These combinations mean the bet that takes part in an arbitrage situation is “against Team2”, “against a draw” and “against Team1”. The odds are calculated by the formula which was already stated above: х/(х-1).
However, if you use arbitrage scanners in betting, calculator that they already have display Lay odds in the familiar form. Therefore, such services spare us the need of unnecessary calculations.
It may seem a bit hard to understand back and lay betting at first. But when you get to enjoy the pleasure, you’ll understand the benefit.