Help me understand betting exchanges!

[Matt.NFFC.]

To put it simply, I just don't get it.  Regularly I see posts on this site saying stuff like "I've backed this so I'll secure profit later by laying it etc" and "win lose or draw I'm in profit"

How does it work? So if I have £20 lay bet on a 0 - 0 draw at 10/1, I lose £220 right?

So if I back it to be 0 - 0 at 8/1 I win £180.  So a loss of £40

Is the idea just to simply back something at a higher price than a lay bet or is it not as simple as that?

Idiots guide required please.

Go easy on me 

[AndrewT]

To put it simply, I just don't get it.  Regularly I see posts on this site saying stuff like "I've backed this so I'll secure profit later by laying it etc" and "win lose or draw I'm in profit"

How does it work? So if I have £20 lay bet on a 0 - 0 draw at 10/1, I lose £220 right?

So if I back it to be 0 - 0 at 8/1 I win £180.  So a loss of £40

Is the idea just to simply back something at a higher price than a lay bet or is it not as simple as that?

Idiots guide required please.

Go easy on me 

Yeah, you just do that, except the other way around.

[Pawprint]

To put it simply, I just don't get it.  Regularly I see posts on this site saying stuff like "I've backed this so I'll secure profit later by laying it etc" and "win lose or draw I'm in profit"

How does it work? So if I have £20 lay bet on a 0 - 0 draw at 10/1, I lose £220 right?

So if I back it to be 0 - 0 at 8/1 I win £180.  So a loss of £40

Is the idea just to simply back something at a higher price than a lay bet or is it not as simple as that?

Idiots guide required please.

Go easy on me 

It's as simple as that.  The difference between the odds you back and lay is your profit.  If lay odds are higher than backed odds, you make a loss, or can cap any loss you may have.

[Matt.NFFC.]

Ok, so, scenario 1 is this:

At 10am, I think a horse will win later today so I back it at 5/1
At 3pm, other people think this and the price is 3/1

So do I just lay it at this price for a little profit either way?

Sounds far too simple. 

Why isn't everyone doing it?

[Longy]

Ok, so, scenario 1 is this:

At 10am, I think a horse will win later today so I back it at 5/1
At 3pm, other people think this and the price is 3/1

So do I just lay it at this price for a little profit either way?

Sounds far too simple. 

Why isn't everyone doing it?

Correct, there are people doing it. Finding a horse that will come in that far is the skill. I actual trying with small stakes to teach myself how to trade this year on English football, pretty mixed result so far, it ain't as easy as it looks.

[gatso]

Why isn't everyone doing it?

because it's just as likely that your horse will drift to 7/1 in which case you should've laid it at 5/1 when you in fact backed it

[Pawprint]

Ok, so, scenario 1 is this:

At 10am, I think a horse will win later today so I back it at 5/1
At 3pm, other people think this and the price is 3/1

So do I just lay it at this price for a little profit either way?

Sounds far too simple.  

Why isn't everyone doing it?

You've got a few options there.

Say you've bet £100 at 6.0

If it has gone into 4.0 you can lay it off to cover your initial bet and then the bet becomes a freeroll with the remainder, or you lay off enough to guarantee a profit whatever the outcome.

Option 1

Bet £100 @ 6.0
Lay £100 @ 4.0

The bet is now neutral, but if it wins you pocket £200

Option 2

Bet £100 @ 6.0
Lay £140 @ 4.0

This means you are guaranteeding yourself £40 profit whatever the outcome.

If it wins you collect £600, but pay out £560.
If it loses you pay out £100, but collect £140.


This ignores whatever commission you would have to pay, which you would need to take into account.

[Blatch]

Ok, so, scenario 1 is this:

At 10am, I think a horse will win later today so I back it at 5/1
At 3pm, other people think this and the price is 3/1

So do I just lay it at this price for a little profit either way?

Sounds far too simple. 

Why isn't everyone doing it?

Your spot on but remember to lay a fraction more than what you backed for if you want profit all round.  Otherwise you will break even on the field and have the profit on the one horse.

But generally you have the idea ... now you just have to find ways to make it work.

[Blatch]

You can also get betfair to show you your profit and loss on each selection so you dont have to work it out.

[thetank]

Ok, so, scenario 1 is this:

At 10am, I think a horse will win later today so I back it at 5/1
At 3pm, other people think this and the price is 3/1

So do I just lay it at this price for a little profit either way?

Sounds far too simple.  

Why isn't everyone doing it?

Everyone is doing it, that's why the price has come down to 3/1   



^trying to be funny, not helpful, do not read

[Matt.NFFC.]

So why would you ever lay something if you can only ever win your stake money back??

[Longy]

So why would you ever lay something if you can only ever win your stake money back??

Huh?

If you lay £10  on a 3 to 1 shot, you have a liability of £30. So you either win £10 (the backers stake) or lose £30, you are just playing the bookie. Just look at it like backing a 1/3 shot.

[Matt.NFFC.]

So your saying I'd get my £10 back if it lost and someone else's £10, for a £10 profit???

Told you I needed an idiots guide!!!

[Longy]

So your saying I'd get my £10 back if it lost and someone else's £10, for a £10 profit???

Told you I needed an idiots guide!!!

On betfair and other exchanges you aren't putting £40 on the above bet, you are putting £30 to win £10. The £10 comes from the person who has backed the odds you have layed.

There is no other £10 just the £30 the backer can potentially win.

[kukushkin88]

It really is more simple than you can imagine. They have a few tutorials on the site that will probably tell you most of what you need to know. Best thing is deposit a few quid and just learn as you go along.