Matched betting couldn’t be possible without betting exchanges. These websites, unlike traditional bookmakers, where you place a bet at odds fixed by the bookmakers, allow you to place bets and offer bets with other players like you. In betting exchanges, you set the odds or accept odds set by other players. Don’t worry. You will not have to do any difficult calculations or try to predict the odds of a match. Let’s see how it works in this video.
In order to place lay bets, we have to register on Betfair. We picked Betfair because it is the biggest exchange available and one with the most players. You are free to use other betting exchanges, but keep in mind that all the guides on this website will use Betfair as an example.
In the Exchange section of Betfair (the only one we are going to use!) you place back and lay bets against other players. To place a bet in the Exchange section, there has to be someone willing to accept that bet.
Take a look at the Exchange section on Betfair.
On the Exchange, you can see that the odds are in two different colours: pink and blue. Blue stands for a back bet, pink for a lay bet.
We are using Betfair only to place lay bets.
When you place a lay bet, you are taking the role of the bookmakers. You gain what a bookmaker would gain from a bet. Let’s look at an example.
You place a 10€ lay bet on team A at odds 1.5:
If team A wins you lose the bet: you have to pay 10€ x 1.5 – 10€ = 5€.
If team A does NOT win (loses or draw): you gain the 10€
By placing a lay bet, you are accepting someone else’s back bet. In our example, you just placed a lay bet on team A, and someone placed a back bet on the same team. With your lay bet, you accepted his back bet. In fact, if team A wins you are paying the other player the win (5€) and if team A does NOT win you gain the 10€ the other player bet.
You can consider a lay bet as the opposite of a normal bet (back bet): the stake of a lay bet is what you could win (not what you could lose as in the back bet) and the liability is what you could lose.
When you place a lay bet, Betfair will tell you how much you risk (in our example 5€), this amount is called “liability”. You need to have enough funds on Betfair to cover the liability to place a lay bet.
When you place the lay bet, the stake would be your potential winnings and the liability your losses. You only need to have the liability amount on Betfair to place the lay bet. In our example: to place a 10€ lay bet on team A at 1.5 odds with 5€ liability you need to have at least 5€ on Betfair.
Since Betfair is an exchange, for every lay bet you place there has to be someone willing to accept it. You can see how much money you can place on your lay bet below the odds. This amount is called “Liquidity”. It means there is all that money waiting for someone to place the lay bet. You will have to check if there is enough liquidity before betting. If there is not, we suggest searching for another match with enough liquidity.
Let’s check all these concepts in one example.
For our example, we are going to use a Champions League match: Chelsea-Barcelona.
We suppose that we have already placed a 10€ back bet on Chelsea on a bookmaker’s website and now we want to place a lay bet on the same outcome to win the same money regardless of the result of the match.
By clicking on the match, you will enter the dedicated page:
What are all those numbers?
In this screenshot, you can see the odds for betting on Chelsea, Barcelona or the Draw between the two teams.
Let’s look only at the coloured columns for now. You can see the blue column “Back all” and the pink one “Lay all”.
On the blue column, there are the odds for a back bet (betting for the team). In our example, you can place a bet for Chelsea to win at 4 odds.
The pink column stands for a lay bet (betting the team will NOT win). In our example, you can place a bet for Chelsea to NOT win at 4.2 odds.
The liquidity for every bet is indicated under the odds. For example, there is 949€ liquidity to place a lay bet on Chelsea at 4.2 odds. It means that you can place lay bets up to 949€.
To place a lay bet you can click on the pink box, and this screen will appear:
Here you can choose how much to place on your lay bet (in our example 10€). Immediately you will see how much is the liability for this lay bet. You will need to have that amount on Betfair to be able to bet. On the left, you can see how much you will gain from the bet with all the different outcomes. If Barcelona wins or there is a draw we will gain 10€ (the lay bet stake) from our lay bet. If Chelsea wins, we will have to pay the liability: 32€.
Betfair gains money from the exchange through a 6.5% commission on all wins. Our calculator takes this commission into account and tells you exactly what you will gain from every bet. Betfair has a points rewards system, the more you bet the more points you get. At certain points level, you can get a discount on you exchange commission. You can find your discount level and your points on your account page on Betfair.
You can see that there are different odds and available bets in the other white columns. Those are bets waiting to be accepted at higher odds (lower for back bets). We will not use them since they are less convenient for us.
There are many additional features on Betfair. You don’t need to know anything more than what is described in this guide on Matched Betting. If you are interested, we suggest checking the Betfair guides on its website.
It may seem all confusing at the moment, but bet after bet, you will understand better. In our step-by-step guides, we will tell you exactly what to do. Let’s go to the last guide before start making money with the offers!