Each-way betting. An each way bet is a combination bet involving two separate bets – a win bet and a place bet. As a place bet is more complicated to understand this will be looked at first. More...

 
 

Asian Handicaps. Asian handicaps are the most difficult of the popular football markets to understand. The name comes from its Far East origins and is used to describe a type of spread betting in Football. More...

Types of bet

There are basically two different ways you can bet on sporting events. One, you can ‘Back’ an outcome. Two, you can ‘Lay’ an outcome. But using these two bet types in combination or in multiples, several of one type, you can create what is termed Arbitrage bets, Dutching bets or Trades.

Back bets

A bet by definition is an agreement between two parties that the one who has made an incorrect prediction about an uncertain outcome will forfeit something stipulated to the other, a wager. If you are the party that has bet on something to happen, a horse to win a race, a football team to win etc, then you have placed a back bet. There are some Markets that split your Back bet into two different bets, like each-way bets or split ball Asian handicaps, but you’re still betting on something to happen or two things to happen.

On placing a Back bet you are given odds, the chance of the outcome happening. Once the event has been completed, you have either won your bet or lost. If you win you are returned your initial bet, called stake, plus your stake multiplied by the odds (if you were given fractional odds. If you were given decimal odds your return is simply stake multiplied by odds). If you lose, you lose your stake.

Give an example

Lay bets

This bet type is the opposite of the Back bet, you are betting on something not to happen, a horse not to win a race, a football team not to win etc. This type of bet has grown significantly over the last few years with the growth of betting exchanges and cannot be placed at traditional bookmakers.

On placing a Lay bet you give the Back better odds, as this will normally be done on a betting exchange the odds will be given as a decimal. If the bet on event doesn’t happen you win the Back bettors stake. If the event does happen, you lose, and will have to give the Back bettor money to the value off his stake multiple by the odds minus the stake.

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Arbitrage bets

An Arbitrage bet described in its simplest terms is a series of simultaneous bets that lock in a profit, whatever the outcome of the event. This can be achieved by Backing all the outcomes of an event, taking advantage of differing odds of bookmakers or by Backing high with a bookie and laying low on an exchange.

A profitable ‘Backing all the outcomes’ Arbitrage bet only arises when the sum of the inverse of all odds is less than 1. This sound quite complicated, but is in fact rather simple. Take for example the match odds market for a football game, where there are three different outcomes – Home win (H), Away win (A) or Draw (D). For there to be an Arbitrage 1/H + 1/A + 1/D must is less than 1.

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A profitable ‘Back-Lay’ Arbitrage bet only arises when the Back odds are greater than the Lay odds, with the exchanges commission taken in to account.

For all calculations that need to be made in order to find the different stakes that need to be place on each outcome click here

Dutching Bets

Dutching is a method of mathematically staking several selections on the same event, and providing you’ve selected the winner, each selection returns the same profit. The maths behind what stake should be placed on each selection is the equivalent to a partial arbitrage bet, so check the advanced arbitrage calculations if this is needed.

Trading

When Trading, the goal is to Back high and Lay low, but unlike ‘Back-Lay’ Arbitrage bets where the high Back price and low Lay price is available simultaneously, a trader is speculating on price movement. If it is thought the price will shorten, a Back bet will be placed, once the odds have shortened a Lay bet will then be placed. And vice versa if it is believed the odds will lengthen.

There are two different methods used in trading, one keeps all the trade profit (or loss) on one selection and the other distributes the profit equally over all the selections, most commonly called ‘greening up’.

To keep all the action on one selection is simple. The Back stake placed must be the same as the Lay stake. The obvious drawback to this is the traded selection has to win or all the effort put in will result in zero profit.

To ‘green up’ a little bit of maths is needed, if a Back bet is placed first the Lay stake will equal the Back odds multiplied by the back stake then divide that total by the Lay odds available. Conversely, for the Lay bet being placed first replace Back with Lay and Lay with Back.

Lay stake = (Back odds * Back stake) / Lay odds
Back stake = (Lay odds * Lay stake) / Back odds

   
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