To lay a bet is simply to bet that a certain event will not happen, ie to take the place of the bookmaker.
Say that Man Utd are playing Aston Villa in a football match. The odds for Man Utd to win (when expressed as decimal odds) are 2.25 (or 5/4 as fractional). The odds for Aston Villa to win are 4 (or 3/1). Odds for the draw are 3 (or 2/1).
If you were to lay Aston Villa to win, and you were willing to do this with an amount of £10, you are basically offering £10 for someone to bet on Aston Villa to win. You are taking the place of the Bookie, and allowing a punter to place a bet.
When you lay a bet, you are betting against that event happening – so in this example, you are betting against Aston Villa winning the match. If Aston Villa lose or draw, then you are successful. Only if they win, have you lost your money.
You can lay any bets at an online exchange, the most popular ones being Betfair and Mansion. We will discuss these in more detail later on in the article.
Say Aston Villa win, you have to pay out £40. (The £10 lay and then the £30 winnings – £10 lay x odds of 4 = £40).
However if Aston Villa don’t win – they lose or draw, then you get the £10 lay, which was the punters money.
Say that Arsenal are playing Tottenham Hotspur in a football match. The odds for Arsenal to win (when expressed as decimal odds) are 3 (or 2/1). The odds for Tottenham Hotspur to win are 4 (or 3/1). Odds for the draw are 2.25 (or 5/4).
If you think there was going to be a bit of an upset, and you think Arsenal won’t win, you can lay them to win. Say you lay them with £40, at odds of 3. This means that if Arsenal do not win, ie they lose or draw, then you’ve earned £40.
If Arsenal do win, then you’ve got to pay out for the bet – £120. (The £40 lay and then the £80 winnings – £40 lay x odds of 3 = £120).
Earning money from this:
You may now be thinking that this just sounds like another form of gambling, and to be honest it is, but there is a way of using it to guarantee a profit with a little help from online bookies.
Often when you use an online bookmaker, they will offer you some form of a sign up bonus – for example, when you sign up and place a £30 bet, they will give you a free £30 bet.
The free bet or bonus enables a profit to be made from bet laying/matching.
When you match a bet, you are basically covering both sides of the bet.
Imagine you were to lay a bet, as mentioned earlier on in this article. Then you make exactly the same bet but this time you bet normally, by staking a certain amount at certain odds, at a bookmakers. If you win your bet with the bookies, you will get your winnings from that bet but you will also have to “pay out” for your lay. This is where the two outcomes cancel each other out, meaning you have lost nothing (but also gained nothing). However, if you were to use a free bet or bonus money, then either on the lay or the bet you will make a profit.
It’s important to point out at this point that when laying a bet, it’s important to try and lay at odds that are as similar as possible to the actual odds that are available at the Bookmakers. This is so that a minimal loss is made when making the bets. Also, if you are able to find lay odds at the Exchange that are lower then the odds at the Bookmaker, you can guarantee a profit.
An Example of a Matched Bet using your own money:
Say the odds of Chelsea winning the Premiership are 3, or 2/1. These are the odds of them winning at the bookmakers. To lay at the exchange Chelsea winning the Premiership the odds are the same, 3.
If you placed £10 on Chelsea to win the Premiership at the bookmakers, and then lay £10 at the Exchange, both outcomes will have cancelled each other out.
If Chelsea win the Premiership, then you get £30 from the Bookmakers (£20 profit, and the £10 bet is returned with the winnings.) With the lay at the Exchange, you will have to pay out £30 (Their £10 stake and the £20 winnings from the bet). Therefore you would have £20 profit at the Bookmakers, and £20 loss at the Exchange. This means you are back to square one, and have neither gained nor made a loss.
Just to confirm, had Chelsea not won the Premiership, then you would have lost your £10 bet at the Bookmakers, but you would have won the £10 lay at the Exchange, again cancelling each other out.
All of this is of course pretty pointless, unless you were using a free bet.
An Example of a Matched Bet using your own money and a free bet:
We will use the same scenario as before to keep things simple.
The odds of Chelsea winning the Premiership are 3, or 2/1. These are the odds of them winning at the bookmakers. To lay at the exchange Chelsea winning the Premiership the odds are the same, 3.
If you used a free bet stake of £10 on Chelsea to win the Premiership at the Bookmakers, and then lay £10 (your own money) at the Exchange, then no matter what happens you will have made a profit.
If Chelsea win the Premiership, then you have won £30 (as long as the free bet was stake-returned). You would then have to pay out £20 at the Exchange for the lay. This means that you have an overall profit of £10 (£30 winnings minus £20 lay loss).
If Chelsea don’t win the Premiership, then you have lost your free-bet (no actual loss though as it didn’t cost you anything) but you will win your £10 lay, so you will have £10 profit.
From this scenario, you can see that by using a free bet you can guarantee to gain nearly almost of the free-bet amount back. There are a few issues that mean its not always possible to extract the full amount back. At the Lay Exchanges they often charge commission on any winnings on a bet or lay. At the most popular Exchange, Betfair, the commission is usually %5.
Another issue is that sometimes the free-bet is SNR or Stake Non-Returned. This means that if you were to place a £10 bet on odds of 3 (2/1), you will only receive £20 back, and your stake isn’t returned.
Both of these and any other issues are easily solved, thanks to the spreadsheets and programs made freely available for people to use when working out their bet matching. These usually make a field available for you to enter a Non-Stake Returned figure (or Stake Forfeit), as well as allowing you to enter the rate of commission at the Exchange.
Often when entering the odds into the spreadsheet, most programs will only accept fractional odds and not decimal odds. Though most Bookies are able to offer fractional odds upon request, it is simple enough to convert between the two.
If the fractional odds were 4/1, you divide the top by the bottom and then add 1.
4 / 1 = 4 + 1 = 5.
Or if the fractional odds were 5/4:
5/4 = 1.25 + 1 = 2.25
When Bookmakers offer free-bets, most of the time they will be stake non-returnable. This is because people can simply use this free bet on a certainty, such as Chelsea to beat Rushden and Diamonds. They would then receive the entire free-bet back, as well as any other winnings. However when the stake isn’t returned on a bet like this, they would hardly earn any money from it. For example if the odds on Chelsea to beat Rushden and Diamonds were 1.2 and you had a £20 stake-not returned bet and you placed the £20 on Chelsea to win, you would only receive £4 back. Obviously if the stake was returned you would have earned £24.
The Bookmakers don’t want people to be able to do this, which is why the free bets or bonus bets are usually not stake returned. However, the best way around this is to bet on something with high odds when it comes to using a free-bet.
For example, say you had gone the other way and used the free £20 bet on Rushden and Diamonds to beat Chelsea at odds of 9. You would have won £160, and this doesn’t include our original stake. This is a very good return on the free-bet, and is a lot better than the £4 you would have won if you backed Chelsea. Obviously it is very unlikely that Rushden and Diamonds would have won the match in the first place, but as long as you remember to Lay the bet at the Exchange, you would have unlocked most of the free bet as your own money (as long as you found odds similar, or lower, when laying the same outcome at the Exchange).
From the matched bet above,you can see that the Lay Stake needed to match this bet is £10.29 and that there is an overall closeness of %97.79. The Lay Odds in the situation above are lower than the Back odds, by 0.05. This would normally form an Arb*, but due to the %5 Lay Commission, there is no arb. Often when you place a qualifying bet, and then lay it out, you will make a small loss as long as you have odds which are reasonbly close together. However on the odd occasion you will get Lay odds which are lower than the Back odds. This means that no matter what happens in the event*, you will come out with a profit. Often though you only ever make a small loss when matching the bet, but this is okay because by matching the bet in the first place you will be unlocking a free-bet or bonus. The free-bet or bonus is the earner, and you can usually gain about %80 of the free-bet as your own money (as long as you match the bet properly).
How to Lay the Bet:
It’s best to use a more popular Exchange when you start laying your bets, such as Betfair. With Betfair most of the time their commission rate is %5 but sometimes it can be %1, its best to check with the terms listed on the website.
It is very simple to lay a bet at Betfair. You simply find the relevant market and find the same event which you have bet on (if you are matching a bet) and then you will see pink and white values on either side of the screen. The white values are to back an event, which is just to bet on the event. The pink side is the lay side, which are the lay prices that are currently available. The amount of money which is available at each of the prices are listed below each of the values, so that you know how much you can use.
Of course if you are not happy with the Lay odds available at the Exchange at Betfair you are able to set your own price, and then put the amount of money you are willing to accept there. Then it is up to another user to choose to accept that Lay value, and to choose the amount of money they wish to take of it. If no-one accepts that (the bet doesn’t get matched) then you will have to lower your lay value or cancel it completely.
For example, say someone has bet £100 at the Bookies on Bolton to win against Arsenal, at odds of 4. This same person might then go on to Betfair and put up a Lay value of 2 on Bolton to win against Arsenal, and put £200 available for this. Then the person will have to wait for other people using Betfair to accept the odds he has made available.
Limitation Factors, Drawbacks and Guidance:
Throughout this article there are a few things which I have touched upon which can limit your success doing matched betting and arbitage betting. The biggest factors are related to arbitage betting, and matched betting is generally safe as long as you know what you are doing, which is also the first most important point.
- Make sure you know what you are doing
This is self-explanatory really, but its paramount that you read and re-read this article before you even look into starting any matched betting. You need to understand that you are doing this to try and gain the Bookmakers bonuses, and maybe when you get used to it you can have a go at Arbitage betting too. You must understand that you can lose a lot of money if you do things the wrong way, such as forgetting to Lay an event, or by Laying the wrong event. You have to be very careful in your actions by taking your time over things, and double-checking your figures.
- Stick to familiar sports and markets
You have probably noticed by now that every example written on this website involves football. This is because it is believed to be the ‘safest’ sport to bet on, in terms of the rules at the Bookmakers and the Exchanges. For example, in a sport like tennis, its quite possible that a player could retire during the match due to an injury. Some Bookmakers might have one set of rules for this event occurring, and decide not to pay out on the winner, and an Exchange might have different rules too. Also with horse-racing, if a horse is a non-runner and pulls out, the rules can again change depending on the Bookmaker. By all means you can bet with other sports than football, but just make sure you are familiar with the rules. Football is deemed to be pretty safe, in the way that most Bookmakers and Exchanges employ the same rules, so its rare that something would go wrong.
You must also make sure that you are familiar with the market that you are betting on, as again the rules can change depending on the Bookmakers or Exchange. Make sure if you back an event on a certain market at the Bookmakers, you are laying the same one at the Exchange. Also, sometimes the commission rates at the Exchanges will change for certain markets, so be careful of this too – you could be losing out on some extra money if you forget to knock the commission rate down to %3 in some cases.
- Be Wary of your Commission rate
I mentioned earlier the changing commission rate on certain markets, this can also apply to the whole Exchange. For example Betfair is %5 for the majority of markets, so you will need to enter this value into your calculations for the lay. However if you were to use an Exchange called Mansion, I think their default value is about %1. You must make sure that you are entering the correct value for the commission rate at the Exchanges that you use, or else you could miss out on extra money.
I know that Betfair runs a scheme at the moment whereby if you spend so much at their Exchange, your commission rate can be reduced. You must be aware of these sorts of things otherwise you will not be able to maximise your earnings.
Liability is a very big factor when it comes to Laying a bet at an Exchange. In gambling terms the word liability basically means the amount which is to be wagered, the potential loss from an event. When you Lay an event at the Exchange, there will always be a value called the liability. This is the money which you will have to pay out, if the lay event happens. The higher the Lay value, and the higher the Lay odds, then the higher your liability will be. This is why Arbitage betting isn’t for everyone, because in some cases you will need a large amount of spare cash in your betting account in the Exchange, in case you need to pay out. Of course if you matched the bet properly then you will have an equally large or larger amount won at the Bookmakers to cancel out this loss, but you will always need the money readily available in the Exchange in case you have to pay out.
This is an ever-constant problem which is basically unavoidable when it comes to bet laying. As someone sets a price for a Lay event, and an amount they are willing to accept for this, people will often rush to snap up the best price. All it takes is a matter of seconds and the amazing Lay price which you have used in your calculations will be gone, and you’ve already backed the bet at the Bookmakers. This happens to everyone, and is just one of those things. The only thing you could do in that situation is to hold back and hope for another low Lay price, or to just cut your loses and Lay at a higher price and thus lose some money. Some people try to avoid this problem by Laying the bet first of all, and then backing at the Bookmakers, but things can still go wrong, and its just one of those things. Its best to try and not rush, in case of errors, but be sure with your lay amount and prepare in advance of the event taking place. Often the market prices can change due to an injury to a player, or just to general feelings about the event, so you must be careful.