They say the ‘bookmakers always win’. Absolute folly, bookmaking firms certainly make a profit at the end of every financial year but a small minority of sports gamblers can and do make a profit, even a living, out of gambling.
But the life of a professional gambler is precarious. If finding angles which yield a profit within the scores of betting markets now available on dozens of sports is not hard enough, those irksome bookies don’t make their life easy. It’s a simple fact that bookmakers quickly close down the accounts of gamblers who show the ability to consistently win. Can you blame them, no other business would allow customers to help themselves to cash from their tills.
Consequently many shrewd punters turn their attention to betting into tote- pools (known as Pari-Mutuels in many parts of the world). These simply pool together people’s bets and return a dividend, less a commission or ‘retention’, to those that have backed the race winner.
But once again there is a problem here. Tote pools are pretty much exclusive to horse and greyhound racing. New age successful gamblers tend to concentrate on sports such as football, darts, Formula 1, cricket and tennis. Thankfully, to the punters' rescue, there are betting exchanges, a cross between a tote pari-mutuel system, a traditional bookmaker and a stock market. But, how does betting exchange work?
How Do Betting Exchanges Work?
If you think ‘stock market’ ahead of ‘bookmaker’ or ‘tote’ you should be able to understand betting exchanges quickly. The similarity with a tote system relates to the fact that people are pooling their money and basically winning from one another. The tote facilitator does show a profit, but that comes from a commission based on the amount of money in the pool – as do betting exchanges.
The similarity with traditional bookmaking is the ability to back winners and, as a bookmaker does, ‘lay’ or accept bets from others. Playing the role of bookmaker can be very exciting – and profitable.
The leading betting exchanges, and the Betfair Exchange which made its debut in June 2000 is the biggest and some would say best, most closely work like a stock market where stock can be bought and sold. Unlike a conventional stock exchange, the commodity is prices about an outcome of an event, a ‘future’ and not company values.
Betting exchanges, which are essentially a software platform which facilitate millions of transactions every day, have markets on countless sports. Football is the biggest, rugby, tennis, golf, cricket and horse racing are other major players. But there are also sports such as volleyball, netball, snooker, ice hockey and more. And one of the biggest of all ‘futures markets’ of all is in the politics field. By the time November’s US election comes around there could easily be £100 million in matched wagers on the outcome of the presidential race.
Play The Bookie
So, how do you play the role of bookmaker or simply place a bet on a betting exchange? Firstly open an account, then log-in, deposit funds on to your new account and then simply head to the sport or event which interests you. There’s thousands of markets from Chelsea vs Liverpool at the weekend through to the next greyhound race at Nottingham which could be due off in less than a minute’s time.
Once you have found the sport, then the match or game followed by ‘market’ – bearing in mind you can bet on 100+ outcomes on some football matches ranging from the match result through to correct score, first goal scorer and number of red and yellow cards – you will see two distinct columns. These indicate the price of your selection and how much money you can trade at this and other prices.
By clicking on a tab alongside your selection in the blue column you will be electing to back your selection to win and you will be rewarded at the price on offer. Those prices include your stake so 3.00 represents 2/1 and 6.00 represents 5/1. Alternatively if you want to oppose this runner/player/team you will need to click in the pink ‘lay’ column. In doing so you are betting on this selection to lose. Betting on an exchange really is that simple but mastering exchange betting is something of an art form.
Arbitrage And Trading
The beauty of exchange betting is the ability to make money regardless of the outcome of the race or game which you are trading. In fact the best exchange players do not see themselves as gamblers as they are market forecasters. They tend to speculate on market moves and make their money on correctly identifying which way the market will move before the market - in this case a game or race - matures.
Here’s a quick example: A £100 ‘trade’ placed on a selection at odds of 2.50 (6/4) would yield a £150 profit if it were to win. But there would be a total loss if it loses. So the shrewd exchange player will hope to both back and lay this selection meaning either its victory or defeat will still result in a profit.
His modus operandi would be to back the selection at a pre-contest trading high quote of say 2.7 (yielding a potential £170 profit) and also lay the same selection at 2.1 (a possible trading price low) for £/€130 meaning a £/€143 loss. Consequently, win or lose, there will be a clear profit.
