All about betting exchanges
Earning by Trading on Betting Exchanges
Although a good percentage of sports bettors use betting exchanges merely for placing pre-match bets, the ability of trading markets certainly works as an overwhelmingly appealing factor for many of them. As betting exchanges’ popularity grew by leaps and bounds over the past few decades, it also led to the emergence of a new breed of sports bettors – the betting exchange traders.
The number of pro traders working dedicatedly on betting exchange markets has risen dramatically over the years, with a great multitude of punters bidding goodbye to pre-match betting and focusing solely on trading activities.
Again, it’s important to consider betting exchange merely as a stock market. Hence, the traders on the betting exchange are quite like the traders you’ll find on a stock exchange, focused completely on buying and selling of shares or positions on certain outcomes. The core principles remain the same - you need to buy low and then sell high.
Simply put, trading on a betting exchange is betting on (or backing) a certain result at higher price, followed by betting against (or laying) the exactly same result at a lower price. This phenomenon is commonly referred to as “green booking” in the sports betting industry. Let’s look at it with an example - the possibility of Manchester City winning the English Premier League.
Winner / Back / Lay
Leicester City / 27 (£ 437) 29 (£ 92) 31 (£ 503) / 35 (£ 82) 39 (£ 92) 41 (£ 72)
Arsenal / 2.62 (£ 4316) 2.66 (£ 2158) 2.7 (£ 3237) / 2.72 (£ 166) 2.76 (£ 145) 2.8 (£ 332)
Manchester City / 2.17 (£ 2122) 2.18 (£ 78) 2.2 (£ 3183) / 2.22 (£ 156) 2.25 (£ 136) 2.28 (£ 344)
Liverpool / 61 (£ 32) 66 (£ 426) 71 (£ 138) / 81 (£ 202) 151 (£ 177) 501 (£ 405)
Manchester United / 21 (£ 32) 22 (£ 539) 23 (£ 10) / 25 (£ 82) 28 (£ 72) 33 (£ 74)
Tottenham / 11.5 (£ 1557) 12 (£ 92) 12.5 (£ 2009) / 13 (£ 331) 14 (£ 290) 15 (£ 663)
The table above shows the odds of different teams winning the English Premier League. Let’s now see how you can trade on this market. As emphasised earlier, the focus is to buy at a low price and to sell high on certain positions.
How to do that?
So you’ve gone over the upcoming fixtures and think that Manchester City will witness a winning streak in the times to come. This winning streak is guaranteed to see their odds plummeting. Hence, it may be better to back Man City now, at the offered odds of 2.20 for around £ 100.
Now that you’ve backed Manchester City to win the English Premier League, if it indeed happens, you’d be able to claim a £ 120 profit.
However, you’re not ideally looking at bet placements here, as you’re in it for trading purposes. In fact, it shouldn’t matter to you at all if Manchester City wins the League or faces an unceremonious exit early. You should only be hoping that the Manchester City’s odds of winning the English Premier League fall below the odds that you’ve backed them at (which is 2.20), at any point of the remaining season. Whenever it happens, you can bet against or lay a bet on Manchester City winning the League. By doing so, you’ll ensure that no matter what happens, whether it goes on to win the English Premier League or not, you get your profit.
At this point, let’s say for argument sake that Manchester City does witness a winning streak you expected, and after 8 weeks its odds of winning the English Premier League touch 1.50; it’ll be time for you to trade out of your position. You had bought high (by backing Manchester City at 2.20 odds) and will now sell low (by laying Manchester City at 1.50 odds). You can do this by laying Manchester City’s chances of winning the League at 1.50 odds. Once you do that, you’ll cover your original liability of £ 100, thereby making your bet a free bet. If it does win the league, you’ll make a profit, if it doesn’t, there’ll be no harm done as you’ll break even.
You can also balance your liability, ensuring that you make lesser profit, regardless of the result. If Manchester City does win the English Premier League, you’ll profit. If it doesn’t, you’ll still profit.
All these are fundamentals of trading at any betting exchange, and should make it clear why a great multitude of sports bettors have gradually turned into full-time professional traders at betting exchanges.
Another major reason why punters are increasingly converting into traders at betting exchanges is because one can get out of a certain position pretty easily, regardless of the eventual outcome. You can effectively use multiple ways to make sure that you earn some profit, or are at least able to manage your losses, if results are not in your favour.
All about betting exchanges