This article explores the alternatives to laying at the betting exchanges in order to bet against a result.
Every bettor should try to optimise the financial return from his/her risk, which means finding absolutely the best prices available.
Of course, depending upon the betting exchange employed, profits are eroded by up to 5%, or more if you are subject to premium charges with certain firms.
The time it takes to analyse a match and formulate value bets would be wasted to some degree if you then neglected to tie in the best possible reward on offer.
With a little imagination it is fairly easy to contrive several alternatives to laying certain outcomes within a betting exchange when faced with any lay bet opportunity. The question before committing to a lay bet is whether the same outcome can perhaps be achieved using a different market on the same match?
For example, betting against a team to win a match would usually mean laying them in an exchange, but how about the ‘Double Chance‘ bookmakers’ market favouring the draw and the other team? What about an ‘Asian Handicap +0.5‘ back bet on the other team, or a ‘Dutch‘ back bet on the draw and the other team, possibly even using two different bookmakers?
As ever, the best way to guide you and explain things as simply as possible is using an example and we have chosen the German Bundesliga 1 game between Borussia Moenchengladbach and Hamburger SV (M’gladbach v Hamburg) on 26.09.2012.
Firstly, let us assume we wish to bet against a home victory:
(1) The Obvious Approach: Laying the Home Team at a Betting Exchange
M'gladbach's Lay Price 5 Hours Prior to Kick-off was 1.83 (Betfair)
Laying 10 units at a price of 1.83, provides for a loss of 8.30 units if M’gladbach win the game but 10 units of profit if they don’t win. Including the typical 5% betting exchange commission however, the net financial gain for winning the bet is 10 units minus 5% = 9.50 units.
9.50 divided by 8.30 = 1.145, which equates to a back-betting price of 2.145.
Those back odds (2.145) provide a benchmark against which to compare the various back bet alternatives.
However, it is also necessary to find the equivalent (adjusted) lay odds which take the betting exchange commission into consideration. These adjusted lay odds are the basis for calculating the stake needed to achieve a return of 10 units. This is again crucial to allow comparisons and for this some further reverse engineering is needed:
Back Odds Converted to Lay Odds
The corresponding “adjusted” lay odds to win 10 units can be calculated using three simple steps:
- 1 divided by 2.145 (see above: corresponding back odds) = 0.4662
- 1 minus 0.4662 = 0.5338
- 1 divided by 0.5338 = 1.873
Alternatively, you can also adjust the lay betting odds using a simpler formula:
Divide (Lay Odds minus 1) by (1 minus Commission) plus 1
Illustration:
(1.83-1) divided by (1-0.05) +1 = 1.873
What do these ‘adjusted’ odds mean?
To win 10 units you need to calculate your stake (risk) based on a lay price of 1.873 rather than the price on offer of 1.83.
8.73 units divided by (1.83 -1) = 10.52 units, minus 5% commission (0.526) = 10 units return.
This effectively means risking 5.18% more than the price of 1.83 suggests.
Divide (1.873 minus 1) by (1.83 minus 1) = 1.0518
Therefore, to win exactly 10 units you must risk 8.73 units at lay odds of 1.83.
Multiply 10 units by (1.873 minus 1) = 8.73 units.
Phew, are you still with me..? 😉
Summarising the results:
- Adjusted back-betting price: 2.145 – used to compare the lay price equivalent with the bookmakers’ back bets
- Adjusted lay odds: 1.873 – used to calculate the lay stake to win exactly 10 units
- Necessary stake to win 10 units at lay odds of 1.83: 8.73 units
hi soccerwidow,
gladbach actual winning the game is 51%.
so, the losing the game is 49%.
for 1.
in 100 bets , there will be 51games win and 49games lose probability.
i) if laying gladbach in exchange after 100 bets to win 10units the profit will 510units.
loss will be 427.77units. (8.73*49)
total profit be 82.23
(ii) backing hamburg in asian handicap the profit be same 510 but the lost reduce 394.94.
the overall profit will be 115.06.
2.if in 25 even distribution . the win in each distribution be 13 and lost be 12.
profit 25.24units in 25 lay bets with exchange.
profit 33.28units in 25 handicap match.
profit 31.96units in double chance match.
profit 32.8units in ‘dutch’ back match.
if i wrong , please enlighten me. please .
Second request to my message above.
Thank you.
Great stuff here. Are there answers to the questions posed on page 4 of this article?
Please advise. Thank you.
Warmly,
Brian
Hi, very interesting article with some good advice. But it doesn’t look like you’ve considered your approach to staking & risk when you are betting on multiple lines, or betting and laying simultaneously in the same market, especially in a single Betfair market. For my paper on this topic, please see rankingsoftware.com/research.html.