Betting Exchanges
The developing world of gambling has opened up new ways of punting to make markets more enticing for bettors. The traditional form of betting puts the punter in a duel with betting companies like Paddy Power to determine who will emerge with the victory.
However, the formation of betting exchanges like Betfair puts punters in direct competition with one another, adding an extra element of spice to the experience. The system allows one punter to bet on the selection to fail – also known as a ‘lay’ bet - rather than predict the correct outcome of the event. One thing to note about the Betfair Exchange format is that it alsways shows odds as decimals.
2015 Grand National winner Many Clouds’ ‘industry’ SP was 25/1 (26.0), but he went off at 35.89 on the Betfair Exchange
This form of betting can be considered a safer option, as the bettor has a lot of runners on his side rather than one solitary selection, but it does need the action of another party to enable the bet, especially if the odds are quite favourable on the Betfair Exchange. In the case of receiving 11.0 (10/1) odds for a particular punt, putting on £10, the person placing the lay bet needs another party to put £100 on the line to give the person placing the lay bet the same £10 profit.
The system offers greater flexibility with odds that can be influenced by the trend of the market, which bookmakers may or may not wish to respond to. If there is a small consensus it may not be enough to sway the odds on a normal market position. However, in the case of the Betfair Exchange, it only takes two parties to be in agreement to secure the option.
The development of the exchange has proved to be a popular move by Betfair, giving them an edge in the market by offering a different stance to other bookmakers. The option of lay betting has added an extra dimension to live betting, with the added ability to opt against your selected side if conditions in the contest were to change. We’ll now break down some examples of how the exchange can be used to benefit bold bettors.
Manchester City
City were the most dominant team in the 2017/18 Premier League season according to Infogol, storming to the title with a record amount of points as Pep Guardiola’s men blew away the competition with relative ease. Manchester United were on their pace in the early stages of the campaign but fell away after suffering defeats at the hands of Huddersfield and Chelsea. The crux moment in the season came when United hosted City at Old Trafford. The Blues were able to emerge victorious thanks to goals from David Silva and Nicolas Otamendi, handing them an 11-point lead at the top of the table.
Manchester City were heavily odds-on to win the 2017/18 Premier League
Now, this would be where their odds for the crown would have been venturing towards the 1.01 (1/100) range. There will have been more than a few bets on City to close out the crown due to their overwhelming advantage. Therefore there would have been a solid market from the field, perhaps even in the range of 26.0 (25/1) for United or one of the other chasing pack to reel Guardiola’s men in and snatch the title away from them. The value itself would be intriguing, while there is more than enough evidence to suggest that teams are capable of collapsing.
Newcastle United were seemingly poised to win the Premier League for the first time in the 1995/96 season. The Magpies held a 12-point lead at the top of the table over Manchester United in January but then went on a terrible run of form in the closing stages of the season. They lost five out of eight matches between February and March, allowing Sir Alex Ferguson’s men to eradicate Newcastle’s advantage and win the crown. As it turned out in 2017/18, Man City managed to hold firm despite defeats to Liverpool and United later in the term. However, it does highlight the value of the Betfair Exchange and had it been around in 1996, a punter would have seen a healthy profit. You can use Infogol’s expected goals model to help find value in over or under performing teams. Where’s the value this weekend? Find out with the football analyst at your fingertips.
Golden State Warriors/Atlanta Falcons
These basketball teams are perfect examples of why the Betfair Exchange is useful in sports betting, although neither side will be delighted to be part of the analysis. The Warriors enjoyed a dominant run in the NBA in the 2015/16 season, breaking records on their way to an incredible 73-9 term. They rolled into the post-season aiming to secure back-to-back NBA championships, having previously defeated the Cleveland Cavaliers in the Finals in the last term. The two sides faced off against one another again in the Finals in 2016 and the Warriors were able to establish a 3-1 lead in the series, using the brilliance of Steph Curry and Klay Thompson to put them within striking distance of their second successive triumph. The odds would have been well in the favour of the Warriors, needing only one more win, which included two home matches in the remaining three games of the series. As a result, someone using the exchange to back the Cavaliers would have been offered great value on their odds even with LeBron James and Kyrie Irving. The rest is history as the Cavs won the final three matches of the series to win the NBA Championship in a thrilling upset.
The Falcons are an example of the use of the Betfair Exchange in the live betting environment. In Super Bowl LI, Atlanta stormed into a 28-3 lead against the New England Patriots. It was one of the most overwhelming leads in the history of the Super Bowl, holding a 25-point advantage with just 18 minutes of the contest left. Dan Quinn’s men had a 99.1% chance of victory, which would have been reflected in their odds to see out a comfortable win. Betting against Atlanta at that point would have seen great value, which would have paid dividends as the Patriots came storming back to produce one of the greatest comebacks in NFL history.
Exchange Usage
As proven by the examples above, there’s always an element of risk when betting. However, the Betfair Exchange can be more rewarding than a normal punt using nous and experience to gain the maximum value on your return. It takes knowledge to pull off success and should be considered by all serious punters.