| WHAT ARE BETTING EXCHANGES? - A
BRIEF EXPLANATION AND BASIC TACTICS. by david parkinson
WHAT ARE BETTING EXCHANGES? - AN EXPLANATION AND BASIC
TACTICS. Betting exchanges online were only introduced a
few years ago,by British firm Betfair,and have grown so
rapidly,that they now,not the bookmakers,set the prices
for most sporting events.The bookmakers have to consult
and respond to what is happening on the exchanges.Even if
you have never had a bet on the exchanges,you should be
very happy about their existance.A visible example is the
prices on offer in British horseracing,whereas at one
time it was most unusual to see an outsider at odds of
more than 33/1,but now many runners are of ten returned
with starting prices of 66/1+,this is entirely due to the
exchanges.Not so obvious is the day to day tightening of
percentages on all betting events which benefit all
punters.Despite this you can still get far better odds on
the exchanges,typically 20% better according to the
exchanges themselves. Betfair is the dominant betting
exchange,with Betdaq a good alternative.There is very
little competition - is this a bad thing ?.Absolutely
not.If you think about it,the best exchange is going to
be the one with the most punters,both bettors and
layers.The exchanges.don't actually do anything !.They
just open the doors,maintain the site,but it is up to the
people who enter and participate who create everything
themselves. HOW DO YOU BET?.You can back anything on the
exchanges,you can lay anything on the exchanges,and you
can back and lay the same selection.In fact this is the
best approach,if you can back a horse(we will use
horseracing in most examples,but could be any
sport)at,lets say 12.00(11/1)and then lay a horse at,lets
say 9.00(8/1),you are now in the happy position of not
being able to lose.Lets say you bet in $10 units(you can
have much smaller,or larger bets if you so wish),so if
the horse wins,you will win $110,but of course you have
to pay the person who bet the horse at 9.00 with you.In
this example you win $110 and pay $80,meaning a profit of
$30.If the horse loses it has cost you nothing,you bet
$10,you layed $10,and in effect you have had a free bet
!.Don't worry about trying to keep track of your bets,the
screen will automatically show you what your liabilities
are for each horse - green for profit,red for loss.Also
bear in mind that the exchanges have to make money
somewhere,and they charge commission on winning
bets,nothing on losing bets.The commission is usually
5%,but this figure falls as you accumulate loyalty
points.For presentation purposes decimals are used for
prices,this allows the minutest of price changes to be
catered for,but it is awkward at first for punters who
are used to fractional odds,but you soon get used to
adding stake into prices displayed.Some examples - 10.00
= 9/1, 14.00=13/1, 4.5=7/2, 2.1=11/10 etc. THINGS CAN GO
WRONG.Sometimes you are going to take a price,with the
view to laying at lower price,only to be dismayed to see
the price drift alarmingly.What to do now?.Well don't
panic,not yet anyway!.You have got three choices.Firstly
i assume you fancied the selection,so maybe just let it
run,after all just because it drifts,it does not mean it
can't win.Secondly you may want to lay it at a bigger
price than you backed it.In other words,hope it gets beat
and you finish level.If it does win you will have to pay
the difference between the price you backed,and the price
you laid.This is the worst option - it is infuriating to
pay out money on a selection you fancied
originally.Thirdly,you can also back horses(again i refer
to horseracing,but applies to any sporting event)in
running,during the race.This i feel is the best
option.But what price do you offer ?.You can dive in and
out of the race offering different prices as the event
unfolds,or you can offer high price or low price and
leave it.Well should it be high or low?.It depends!.If
you offer a high price(by high i don't mean higher than
you backed it)you are more liable to get a buyer,as most
horses,or teams,at some time get into contention sometime
during an event.So by laying high you could get out of
trouble and finish level.However finishing level is not
too exciting,so offer low price in running.If you take
this option you can turn a bad position into a decent
win,even if your selection loses - just so long as the
selection flatters sometime during the event.For example
you back horse,$10 at 9.00,and it drifts - wait for the
off and offer at about 3.75 for $20.It doesnt have to
win,just be a challenger at some time and hopefully
someone will take it on.If it wins,you win $80 and pay
$55 = $25 profit.If it loses,you lose $10,and collect $20
= $10 profit.If the selection never shows,well no one is
going to take up your bet,and you have done your money
this time,but at least you went down fighting. Bets that
have already lost,but still available.Sometimes the odds
available may look unbelievably good,if that is the case
there is probably a good reason.Maybe somebody in the
know has access to information that you don't.It can be
anything - change in going,team struck down with flu
virus,injury that may mean player may not even
participate,a non trier,and on the very rare occassion
corruption.So if a fancied selection drifts
alarmingly,beware,there may be a reason for it. Digital
television is delayed - often you will see say
1000(999/1) appear suddenly on the screen,this is because
a horse has just fallen,or team scored etc.If you are
watching on digital tv you will not be aware of this fact
for maybe 2 seconds.Not long ,but still time enough for
transactions to take place. Arbitrage between exchanges -
forget it.This is when you can back on one exchange and
lay on another.I have no doubt that if you work at it you
can make a small profit,but it will be small.The
exchanges always converge pretty quickly,and the gaps
will always be tiny.The only way to get "value"perhaps is
to note a tightening of price on the exchanges,and back
selection with a bookmaker - if the price stays solid or
reduces further,the bookmakers odds will almost certainly
have to constrict.These tactics are exactly opposite to
what used to happen just a few years ago,when you would
back on the exchanges knowing that their prices would
have to converge with the bookmakers prices.This is no
longer the case,the exchanges,that is the punters
themselves now set the prices. You haven't the time to
sit at computer all day ?.To get full value out of
exchanges,you really need to be at that blasted computer
screen for an unhealthy amount of time,but as we all know
it can be very tiring,and a bit boring.However you can
still play the exchanges.Remember you set your own
prices,and if nobody wants to play with you,the bets just
expire,with no cost to you at all,no matter how many bets
you leave on the exchange.So,if you are horse player,or
sports bettor - get in early - as soon as the markets
open.You can then leave your bets open,say overnight for
horseracing,and maybe several days for other sporting
events.Your tactics should be to leave MANY MANY bets -
all at,what appears even to yourself ridiculously
optimistic prices.Believe me,you will be amazed at some
of the bets you leave that are taken on - remember you
may leave 30 or 40 bets for lets say,tomorrows racing,and
if 3 or 4 are layed you are already in the driving
seat.You can either let them run at fabulous
odds(recommended!)or you can lay bet to other punters
now,either with a view to covering your bet or making
definate profit now.You can of course use the same tacics
for laying bets. The bigger the odds the more value you
get.It can be hard to grasp,but you get better value the
bigger the odds.The movement on the favourites is minute
- there are legions of buyers ready to pounce as soon as
it moves.The bigger the odds there are of course fewer
buyers,this can lead to volatility on a grand
scale.Volatilty is what the shrewd punter likes most of
all.It is not unusual to get odds of approaching 200/1
for a horse that may be showing just 33/1 in the morning
racing press and starting price.This happens because
bookmakers do not parcitipate in this end of the
market,they are watching,and backing the fancied horses
which are the ones that will inflict the damage to
them.Also the big hitters usually back the fancied horses
to big stakes and lay the outsiders to small stakes.So
both bookmakers and big players concentrate on the
fancied horses,this leaves room for you to operate
successfully.Most races are won by fancied horses,but you
only have to win very rarely at these odds to show a very
healthy profit.Also remember once you have this huge
price,you can lay your selection in running and still
make a profit whatever the result. These are just basic
tactics to be employed on the exchanges,and you will
develop your own tactics as you get comfortable with the
systems.However make no mistake the exchanges are the
best thing to happen to regular punters - ever . By
Pendil at British Betting and Gaming Sites.© By
Pendil at British Betting and Gaming Sites.More news and
articles about betting exchanges can be found on our
Betting Exchanges Page.This article can be reproduced by
anyone,so long as all links remain intact. About the
Author By David Parkinson at British Betting and Gaming
Sites. |
