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Backing and Laying Betting Strategies
on Betting Exchanges

How do you define yourself as a punter? Do you simply bet for fun to make matches more exciting to watch, do you put in research and casually read up on the recent form before putting down your bets? Or do you take it one step further and develop detailed betting strategies and look at it as a form of income that you have to work hard at to make a profit?

Whatever type of punter you are there will often be some thought that goes into the bets that you make, and as with most things in life you get out of it what you put into it.

Most punters place bets on markets they are familiar with: over/under goal markets, some pick home favorites, others away favorites, adventurous ones play overpriced underdogs. We often stick with the same strategies, however at times re-evaluating one’s strategy and taking a step back to gain some perspective can boost profits. It is often necessary to apply different strategies in different situations. Here we discuss some basic betting exchange strategies.

Greening Up – Live Tennis Matches
Figure 1: Laying bets on Tennis Matches

Locking in a profit on live events is a strategy widely used by backing and laying on betting exchanges. By “greening up” on live tennis events you can significantly reduce or eliminate risk. For example, backing Murray to win at 1.78 with $100 and then laying Murray later in match at 1.29 with $100. By laying you invest another $29 (shows as liability) to hedge your first stake. In the end you invested $129 (100 backing plus 29 laying Murray) and if Murray wins you profit $49 (178 winnings - 129 invested), but lose nothing if he doesn't (129 payout – 129 invested).

Figure 2: Liability when Laying a Bet on a Betting Exchange

Laying a smaller amount than $100 increases your profit if Murray wins, but you expose yourself to risk of losing a proportional part of your investment. If things go the wrong way, it’s certainly much better than losing the whole bank. The usual acceptable profit to risk ratio in Forex exchange is 3:1, so you can use that as a reference point when calculating.

Figure 3: Greening Up on an Exchange when Odds are Favorable

If you are an experienced player and have that hunch for playing high priced underdogs, betting exchanges almost always offer much higher odds. Bookmakers trail behind on higher odds entrants for two reasons. Firstly bookies will generally have a built in house edge of 6-12% on every event - we’ve all seen tennis matches at various bookmakers where two evenly matched players are both paying 1.88 odds. While odds on bet exchanges sometimes go close to a 100 % return, where each player is paying out at odds approaching 2.00. Secondly bookmakers are very afraid of high odds because they don't want to risk someone exploiting them for a large win. On a betting exchange there is no risk for the house as no one is betting against it. They operate as any other stock exchange where people buy and sell odds between each other and the house charges small commissions for the service they provide.

Laying False Favorites
If you are an experienced punter and know the ins and outs of horse racing or similar sports like greyhound racing, laying a favorite can be profitable. Value betting is, as they say, the only possible way to beat the bookie. Laying false favorites is just a version of value betting on a betting exchange. It requires a decent bankroll and a lot of time and discipline, but in the long run it gives you the edge if you are good at finding value. Value is the difference between offered odds and ''your odds'', where various tools and mathematical methods must be applied when calculating them.

Figure 4: Laying False Favorites on Premier League

If you don't know much about horse racing but are an avid football fan, you can lay false favorites on Premier League relegation odds. For example, you have insight into QPR's plans on upcoming transfer window. You've been tipped that the owners are injecting 50 million pounds in fresh legs which convinces you that QPR is going to avoid relegation this season. So much so that you decide to lay their chances with $300 on 1.93. In the end QPR avoid relegation and you profit $300. The downside to this is that you have to wait for the result at the end of season to see your winnings.

This is why this method is used in sports where with a high frequency of events which means faster turnover. Punters that use it choose betting exchanges since they offer much higher odds than bookies and there are no betting limits. If you want to try it, choose wisely as there are differences in betting exchanges. World Bet comes highly recommended as they charge only 3% commission on all team events like football, tennis, cricket, basketball and more. They also offer a loyalty discount on commission which goes up to 60% which means over time you can improve your commission to a very acceptable 1.2%, making it the lowest commission betting exchange to place your back and lay bets!
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