Trading Bets at BetFair - Betting Exchange Explainer - Backing vs. Laying
Chris F. Masse January 23rd, 2007
After the BetFair multiples, the BetFair prediction exchange:
1. Placing your first bet on BetFair
What is a ‘Back’ Bet?
A ‘Back’ bet is a bet on something to happen – a horse to win a race, a football team to win, a person to be evicted from Big Brother etc. It’s just like the bet you’d regularly place with a traditional bookmaker or tote, or even with your mates.
With Betfair, you can bet on something to happen – Backing, or not to happen – Laying, so we have to change the terminology slightly.
In the example above, you want to back Rail Link for £10 at a price of 10.5. If the bet is submitted and matched, you stand to win £95 (£10 at 9.5/1) less commission (see How is my commission calculated?), plus your stake back. You stand to lose £10 (your stake). You can change the price you’re looking for by typing in a different price or clicking the arrows next to the Your Odds box (see ‘How do I choose my odds?’). Take note though, Betfair markets are dynamic, the prices can move at any time. Also if you change your price from what is currently available, you take the risk of not having your bet matched (see ‘How do I know when my bet is matched?). If the Betfair price improves whilst you are in the process of placing your bet, you will be matched at the best available price – higher for backing, lower for laying (see ‘What is Best Execution?).To turn on the Predictive Profit & Loss (P&L) or ‘What If?’ function shown above, click on ‘Options’ above each market once you’ve logged in.
What is ‘Laying’?
Laying a bet means you are betting on something not to happen – a match not to end in a draw, a horse not to come in first, a rugby team not to win by over 7 pts etc.
It might sound new, but you’ve probably been doing it unconsciously for years. Have you ever had a bet with a mate? It might have been over a game of pool, or on a football match on TV. Two opposing sides, two opposing opinions. He’s backing his team – if they win, he wins. If they lose, you win – you’ve effectively layed his bet by betting on something not to happen.
With Betfair you can not only lay any selection, but also choose the price you want to take, and how much you are prepared to risk. The shorter the price you wish to lay, the less money you have to risk compared to your potential reward. Laying the Tie in the market below at 13.5 might sound safe, but for every £10 you want to win, you have to risk £125 - high risk and low reward. The market says Europe at 1.9/1.91 are much more likely to win, but to win £10 by laying that outcome, you only need to risk £9.10.
In the example, you’ve chosen to lay the USA at the current odds of 2.52. Note that on the left hand side, your potential loss (liability) is shown as £15.20 but on the right the figure is £25.20. This is because the other person’s stake is included in the Payout figure, as each Betfair user must ‘pay’ for their bet first with the money held aside from their account until the market and each bet is settled.There are all sorts of reasons why people lay bets. Some people find it easier to pick a horse that won’t win, than one that will win. Some people lay a bet because they think the price is too short. Others will lay first, then look to back the same selection later in-play – that’s called Trading (see ‘What is Trading?),
Laying need not be scary – you are in full control of how much you wish to risk and how much you could win. In a lay bet, you always stand to win the stake of the opposing bet (e.g. £10 in the example above). You could be betting against one person or several. As mentioned above, your liability is £15.20
To turn on the Predictive Profit & Loss (P&L) or ‘What If?’ function shown above, click on ‘Options’ above each market once you’ve logged in.
Note – Betfair charge a commission fee on net winnings on each market (see How is my commission calculated?),
What is Trading?
Trading is one of the best and most unique things about Betfair. Trading is having more than one bet in a market; seeking to improve your position or lock in a profit on all possible outcomes.
In the example below, you have layed a selection first, and then backed the same selection soon after at a higher price, guaranteeing a profit whichever result occurs. This is what most users call a Green Book because all possible outcomes show a profit (displayed in green below each selection). On top of that, your liability is now zero, meaning there are no funds tied up from your account, so you can place more bets on other markets.
When trading, you want to lay at a low price and back at a higher price. Use the Predictive Profit & Loss (P&L) or ‘What If?’ function (click on ‘Options’ above each market once you’ve logged in) to do the calculations for you. Think of it like buying a house at one price, then selling it later at a higher price. Live sport is perfect for trading, this is why many events at Betfair match far more bets in-play than before the event began.How do I find the market I want?
Betfair open and settle hundreds of markets each day, so we have a menu navigation to allow you to find the one you’re interested in as easily as possible.
From the left hand menu, choose the sport you’re interested in, e.g. Soccer.
You will then be presented with a list of appropriate options, for example, the various countries or leagues from around the world. In this example, you choose English Soccer and then the Barclays Premiership. This opens all the markets relating to the Premiership itself, such as the “Winner” market, plus more categories such as Fixtures for upcoming matches.
How do I place a bet?
Now that you have found the market that you want, you can back or lay bets on the market. Before you place any bet, ensure that you are familiar with the Rules governing that market, which can be found under the Rules tab on the right hand side of the screen. To place a bet, follow these simple instructions or watch our betting tutorials for more information.
- Navigate to the appropriate market. See here.
- The market shows you the prices available to back or lay. The blue box indicates the best price available to back, and the pink box shows the best prices available to lay on each selection, in this example the favourite is available to back at 1.23, and to lay at 1.26.
The figure under the price shows the amount available, in this example a bet of up to £1676 would be matched instantly at 1.23.- Once you have selected which bet you want to take, you click the appropriate box. In this example we have chosen to back QPR to win at 4.
- Clicking your selection launches the “Bet Manager” on the right hand side of the screen.
To place your bet at these odds, insert your stake, in this case £5, in the “Your stake” box. The screen will immediately show you what you could win.- Once you are happy that you have the right selection and you’ve entered the stake you want to bet at the correct odds, click Submit at the bottom of the Bet Manager. This will launch a “Confirmation” screen. Ensure that you have the correct selection, odds and stake and confirm the bet.
If you agree with this, then click yes to confirm at the bottom of the screen, and the bet will immediately be submitted to the exchange.
Hint: You can choose not to confirm your bets by unticking the “Confirm Bets” box at the bottom of this screen.
- Once your bet is submitted to the exchange, the bet manager will immediately confirm to you whether your bet has been “Matched” or not. If it has it will confirm the bet as Matched, and the odds that your bet was matched at. On occasion, the price may change while your bet is being placed. If the price has increased, your bet will be matched at the greater price, if the price has decreased the bet will remain “Unmatched”. An unmatched bet will wait on the system as an order until it is matched by another Betfair member. You can cancel any unmatched bet at any time, or you can adjust the price or stake.
Watch and listen to our betting tutorials for more information.
How much do I have to bet?
The minimum stake on the Betfair site is £2 (or equivalent in other currencies) whether you are Backing or Laying.
If you are betting over the Telephone there is a £50 minimum stake to reflect the quality of the Telephone service that we offer.
How do I choose my odds?
When you’re betting on Betfair, you do not have to take the odds available at that time. If you want better odds, you can ask for them.
As with placing any bet, click on the best price available for your selection: e.g. in this case, the blue (Back) box for 11 to win. The Bet Manager will launch your bet on the right hand side of the screen.
Enter your stake in the usual way, but then amend the odds in the “Your Odds” box to the ones that you would like. You can do this by either entering the numbers on your keyboard, or by using the cursor or up/down keys to scroll through the odds increments.
Submit your bet in the usual way, as explained in “How do I place a bet?”. Or watch our betting tutorials for more information.
Acceptable OddsAll Betfair bets must be placed at ‘acceptable’ Odds increments. This ensures that the market remains disciplined. For example, if you would like to leave an order on the system, you can only change the current Odds by the increment, or multiple of the increment, shown below.
From | To | Increment
1 | 2 | 0.01
2.02 | 3 | 0.02
3.05 | 4 | 0.05
4.1 | 6 | 0.1
6.2 | 10 | 0.2
10.5 | 20 | 0.5
21 | 30 | 1
32 | 50 | 2
55 | 100 | 5
110 | 1000 | 10
1000+ | Not AllowedThe odds increment on Asian Handicap markets is 0.01 for all odds ranges.
What are Decimal Odds?
All prices quoted on Betfair are ‘Decimal’ Odds. Decimal Odds differ from the Odds traditionally quoted in the UK in that they include your stake as part of your total return. If you place a bet of £10 at Decimal Odds of 4.0 and win, then your total return (including stake) is £40. In the UK this would be quoted as 3/1, returning to you winnings of £30 plus your original stake of £10.
Decimal Odds are simpler to use than Traditional Odds, and are the most common form of Odds quoted in countries outside the UK. In addition, for the mathematically minded, Decimal Odds relate more closely to probability: in a race with four equally-matched horses, the probability of each horse winning is 25%. Each horse will have Traditional Odds of 3/1 or Decimal Odds of 4.0. Hence, the probability of an outcome equals 1 divided by its Decimal Odds (1 / 4.0 = 25%).
Decimal Odds also offer many more prices – Betfair offer every price between 1.01 and 2.0 to two decimal places. With no margins to protect, our customers deserve to see every price available.
Converting Decimal Odds to ‘Traditional Odds’
Converting Decimal Odds to Traditional Odds: Decimal Odds minus 1.0 = Traditional Odds (x to 1). Eg 4.0 = 3/1, 1.80 = 4/5 (0.8 to 1)
Converting ‘Traditional Odds’ to Decimal Odds
Converting Traditional Odds to Decimal Odds: Traditional Odds (x to 1) plus 1.0 = Decimal Odds Eg 7/1 = 8.0, 1/2 = 1.50
Betfair Odds Conversion Chart
Fractional Decimal American
10/1 11.00 +1000
9/1 10.00 +900
8/1 9.00 +800
7/1 8.00 +700
6/1 7.00 +600
5/1 6.00 +500
4/1 5.00 +400
3/1 4.00 +300
2/1 3.00 +200
Evs 2.00 +100
10/11 1.91 -110
5/6 1.83 -120
4/5 1.80 -125
8/11 1.73 -138
4/6 1.67 -150
8/13 1.62 -163
4/7 1.57 -175
8/15 1.53 -188
1/2 1.50 -200
4/9 1.44 -225
2/5 1.40 -250
4/11 1.36 -275
1/3 1.33 -300
2/7 1.29 -350
1/4 1.25 -400
2/9 1.22 -450
1/5 1.20 -500
1/6 1.17 -600
1/7 1.14 -700
1/8 1.13 -800
1/10 1.10 -1000How do I know when my bet is matched?
Two ways – watch the My Bets tab on the right hand side of the screen which will indicate which bets are matched and which are unmatched. If the bet remains unmatched, you still have the ability to change the price or stake (the odds and stake box will still be editable).
Alternatively, check your Profit and Loss figure (underneath each selection when the “Show P&L” box at the top of the market). The Profit and Loss will update as your bet(s) is matched. Green indicates potential profit, red shows potential loss.
Find out more by watching our betting tutorials for more information.
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2. Advancing your betting
3. Betting Markets
4. Antepost
5. After the event has finished
6. Rules and Regulations
7. Settlement
See the rest of the HELP file at the BetFair prediction exchange.
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