Everyone should use a Betting Exchange.
Because you get better odds. It’s that simple.
However, I can understand why some betting people are reluctant to join and use an exchange. When you first sign up to a betting exchange, it can be a bit overwhelming because it’s so different from a bookmaker.
I think that’s a very fair opinion. It’s hard to make the jump, but when you do you will never look back.
I fully recommended using Betfair to anyone interested in betting and trading, and I have done a YouTube video to easily explain how to use a Betting Exchange.
Check it out here:
How Betting Odds Work On Exchanges
Most people are familiar with using a Sportsbook, so it takes a while to come around to the idea of using a Betting Exchange. With a Sportsbook, you will see your bog-standard odds layout and the odds will be displayed in fractional format. This has been used since the beginning of time and every punter understands it.
Betting Exchanges are different. The biggest change is the odds format and how you can get more value. The odds are displayed in decimal format, and the market moves around like the stock market. You can get bigger odds and better value too. For example, with the average Sportsbook the market will go from 5/1 (6.0) to 9/2 (5.5), whereas on exchange the price will move to 6.0, 5.9, 5.8, 5.6 and 5.5. You have more time to take the 5.8 if you’ve missed the 6.0, but you still get more value than the 5.5.
This is just because of how the exchanges work. Let’s look at a smaller odds example. A standard movement with a Sportbook would be 6/4 (2.5) to 11/8 (2.38), however again with an Exchange, we go from 2.5 to 2.48, 2.46, 2.44, 2.42, 2.4 and then to 2.38. It’s a much better system for betting and trading!
Why A Betting Exchange Has Better Odds
A Betting Exchange will have better odds because generally speaking the overround is always close to 100%. An overround is the percentage sum of every runner in the market added together. Ideally, this should add up to 100%. Think of a coin flip, heads would be 50% (2.0) and tails would be 50% (2.0) – it makes an overround of 100%! Once liquidity is strong on Betfair then the overround will be very close to 100%, sometimes 101% or 102%.
This isn’t the case with the bookmakers. They typically bet to an overround between 130% and 140%. That means that they take an extra 30% to 40% of the book, meaning that you get worse odds. Let’s go back to the coin flip example. Imagine instead of getting 2.0 on heads or tails you get 1.83 (35.34%), meaning that the odds available for you add up to 70.68% meaning that the bookmaker is getting just under 130%. This is how casinos operate too and make millions.
The coin flip example is a good one. Let’s say we flip the coin ten times and it’s even, you would end up with your money back. But imagine you’re only getting 1.83. If you put £100 on every time you’d end up with £415 meaning a loss of £85. You can see how the odds, and overround, make all the difference.
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