Exchanges have changed the way betting on horse racing works forever, but they’re still complicated things. Read our guide to Exchange betting to learn what they are and how they work, as well as the pros and cons of using one versus a normal bookmaker.
There are a number of exchanges out there, but Betfair exchange is by far the biggest. Other names to mention are Betdaq, Matchbook and Smarkets, although even combined they aren’t as large as Betfair.
Founded in May 1999, Betfair has now grown to be the leading online betting exchange site. Exchanges such as Betfair have revolutionised betting, allowing customers a range of options that are not available with standard bookmakers. Betfair offers its customers a platform to both back selections, as you would with a traditional bookmaker, but also to act as a bookmaker and lay selections. Betfair does not control the prices on markets, the customers do. With this, the prices on events on Betfair are normally better than the prices offered by traditional bookmakers. If you are not happy with a price on a specific event, Betfair also allows the option to ask for a bigger price in the hope that another customer will lay the bet. To facilitate this process of allowing backing and laying between customers, Betfair charges a standard commission rate of 5% on all winning bets, but you can often find much bigger prices than you would on bookmakers, especially with big odds horses.
Unlike a traditional bookmaker, where winning customers may find their stakes limited over time, with Betfair you will never be limited on your stakes, however much you win. The main issue that can occur with placing a bet on Betfair is a lack of liquidity. On many markets, such as horse racing and football, millions of pounds can be traded on single events with thousands of bets being successfully matched. However, with Betfair working by bringing together customer who want to back and lay on specific events, on occasion you may find events that have limited liquidity – with no other customers looking to back or lay on the event. This tends to be on more obscure markets or on less popular events, you may find that no prices become available meaning that if you still wish to have a bet, you will need to use a traditional bookmaker.
The majority of markets on Betfair also allow in-running betting, offering a far greater flexibility than some traditional bookmakers. In-running betting allows customers the option to trade-out on markets with the possibility of locking in a guaranteed profit on markets. Betfair also allow in-running betting on events such as photo-finishes and stewards enquiries, again offering fantastic flexibility for customers. Betfair is used by a number of professional traders who utilise trading software to try to make profit on markets in-running. It’s worth noting that the in-play markets on Betfair tend to be a few seconds ahead of ‘live’ television pictures such as At The Races and RacingUK and some in-running traders use this delay to their advantage, particularly on horse racing markets.
Offering flexible betting options on numerous sporting events from around the world, Betfair offers competitive prices that, on many occasions, cannot be matched by traditional bookmakers. Being able to lay selections is a unique part of betting exchanges and although it may seem daunting at first, Betfair offers a user-friendly platform on which to do this, coupled with tutorial guides. The uniqueness of being able to both back and lay selections opens up the avenue of trading with the aim of guaranteeing a profit on events. Betfair is an account that all punters should look to have.