Lay Betting Explained
Lay bets form an intrinsic part of arbitrage betting in sports. Hence, for any punter, it is necessary to understand how lay bets work.
The difference between a lay bet and a normal bet is fairly easy to understand. In case of a normal bet, one makes a bet on a player/team to win an event during a match or a race. In the case of a lay bet though, a punter bets on a player/team NOT to win an event. You are effectively acting as the bookmaker by taking back bets from others.
Example: Suppose Chelsea and Arsenal are playing a premier league match -
a. A regular bettor would place a regular 'back' bet on Arsenal at, say, bet365 and will win the bet at bet365 if Arsenal go on and win the game in question.
b. However, if you place a lay bet at Betfair on Arsenal, you stand to win your bet at Betfair if Chelsea beat Arsenal OR the match is drawn. As long as Arsenal do not win, you will win your bet at Betfair.
Laying Arsenal in such a game is tantamount to backing Chelsea to either win or draw the game. If one is able to combine a lay bet at a betting exchange with a regular bet with bet365 or another bookie, one could have all sides of the bargain covered if the odds allow. Hence, one will make a profit either way despite which way the match swings. This is known as arbitrage and you can read more on arbitrage here.
Lay bets can be placed on betting exchanges such as Betdaq, Betfair, Ladbrokes Exchange, Smarkets, WBX and Matchbook. As is the norm with betting exchanges, one does not place their bets against the exchanges themselves, but with other customers on the exchange. Thus, there must be a layer and a backer for every bet made at an exchange.
If you lay a bet on Betfair and someone backs it up, your bet will be matched on the exchange. Once the bet is matched, the same cannot be cancelled unless such action has the consent of the exchange in question and this only happens in exceptional circumstances.
It is unlikely that you will get the chance to lay for the same kind of prices that the bookies are laying at particularly on the more popular markets but it is possible on the quieter markets if you are patient. You need to request a lay price which needs to be the current best offer and wait for it to be taken or beaten by another lay bettor.
Some of the terms associated with lay betting are as follows:
Backer’s odds: The backer’s odds is nothing but the odds on one’s lay bet. The higher the odds, the higher the risk will be for the one who makes the lay bet.
Backer’s stake: This is nothing but the total amount that you want to make from a lay bet, say £100. If we take the above example of the match between Chelsea and Arsenal, if you layed Arsenal, you stand to win £100 minus commission if Chelsea wins or the match ends in a draw.
Commission: Betting exchanges charge a certain percentage of your winnings for sustaining themselves. Betfair charges a fixed rate of 5% by default. However, this value decreases with the amount of money that you turn over at the betting exchange.
Liability: In case of a lay bet, the liabilities always depends on the stake and the odds that one lays on. In a case where the backer’s odds is 5 means that a loss of that bet will cost the bettor four times (5-1) his stake on the lay.
Lay betting is an interesting arena which is still developing. This kind of betting is especially popular with people who are into arbitrages. However, lay bets have slowly started to find more takers which explains the popularity of the betting exchanges at the present time. Lay betting has also had a bad press in the horse racing industry and their have been people who are directly involved with horses that have been found guilty of laying horses on Betfair.
When you lay a selection you are effectively backing it not to win. We can therefore come up with the equivalent back odds of your lay selection. The formula to convert your back odds in to lay odds is (1 / (odds-1)) + 1. You can also use our handy back/lay odds converter to do this for you.
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