How To Start Sports Trading On Betfair Exchange

So you want to know how to start sports trading on Betfair Exchange, but don’t have a clue where to start?

No problem.

I’ll cover all the basics so you can get started on your sports trading journey. Not only that, but I’ll show you where to go when you need some more advanced training. After all, why would you not want to take your trading to the next level?!?

The homepage of Betfair Exchange in all its glory!

Warning: This is an extremely over-simplified guide, meant for absolute beginners. Yes, there are much better ways of doing things but everyone’s got to start somewhere, right?!

Sports Trading Basics

Before we get started, it’s important to know what sports trading is and what it isn’t. Do we buy and sell horses for profit? Make random bets and get lucky? Make a trade because some indicator says we should? Not quite. But I’ll do my best to explain:

What is sports trading?

Have you ever been about to place a bet with a bookie and the odds have either gone up or down, before you click to confirm? It is these fluctuations in price that sports traders take advantage of and ultimately, profit from.

By buying a bet at one price and selling it at another, sports traders don’t care who wins the race, football match or any other event. Okay, maybe some do, but more on that later!

Step 1 – Understanding Value

Before you even (virtually) step foot in a betting exchange you need to understand the reasons why you’re going to be placing trades and what in  you are looking out for.

For the purpose of this guide, I’ll tell you exactly what to do but there are many other strategies you may wish to use in the future.

Regardless of the strategy, you will always be looking for value.  That’s the primary goal of almost all traders.

Getting a good deal in the supermarket is quite the same as finding value and long-term profit on the sports betting exchanges!

Think of it like this.

I was always brought up to look for discounted food in supermarkets. We all love a good bargain in the family. If we needed food for the week, we would plan a trip to the supermarket at a particular time, usually an evening when there was most likely to be a larger choice of discounted foods. Things are usually on offer late at night because nobody else is around to buy them before the sell-by date expires.

Just like when I’m training on the sports exchange, all we were doing was looking for value. We can find value in the sports Exchange markets by going against the grain, just like in the supermarkets.

Our goal is always to find value. That is, to take advantage of any situation where the odds are incorrect, in your opinion.

After all, just like a loaf of bread, there is no set price that must be obeyed. It fluctuates depending on the demand, use-by date etc.

Odds are only of value if you have a solid reason to believe so.

Another example of value is as follows.

Imagine your friend offers to double your £1 bet. Each time a coin lands on tails, you win £2 for your £1 stake. If the coin lands on heads, you lose your £1. You have a 50% chance of winning and a 50% chance of losing. Hypothetically, if you were to do this experiment an infinite amount of times, you are likely to have a very similar starting balance to what you began with. This is because the payout odds are as they should be. In this example, there is no value.

Now if your friend started to offer you £3 for every £1 bet that lands on tails, we have found some value! He’s essentially offering you 2/1 odds, even though the “true odds” are evens (50/50 chance of either event happening). It’s now time to scoop up every last bit of value available until your friend realises his mistake! You may win some and lose some, but with these odds, you should in theory, be in profit over time.

In our example below, we are trading odds of value when the rest of the market is looking to jump ship. Like I said, going against the grain is a great way of finding value.

Step 2 – Open a Betfair Exchange account

Now we know that value we are looking for it’s time to go and find it.

For the most part, it’s usually very difficult to find value with a traditional bookmaker. This is because they have high margins on their odds in order to turn a profit, no matter who wins.

In a nutshell… bookies offer shit odds most of the time.

Where do we find decent odds?

Betting exchanges.

I’ll save the full explanation of betting exchanges for another time, but in summary, betting exchanges operate differently to bookmakers.

Instead of offering crap odds to make a profit,  betting exchanges let the market dictate its own price and take a small commission on settled bets. They also allow us to place lay bets, which you can’t do at the bookies.

If you don’t already have a Betfair Exchange account, you can register for free here.

Register today and get a £20 free exchange bet!

There are other exchanges available (Smarkets, BetDaq, matchbook is etc) but Betfair Exchange is by far the biggest.

Step 3 – Lay the draw

We’re going to start with one of the most basic sports trading strategies which is called “laying the draw”.

First, you need to understand what “laying” means in the betting world.

What does a lay bet mean?

When you go to a bookmaker and you place a bet, you are placing a “back” bet. The bookmaker matches your bet by “laying” it. You now have opposing positions in the market.

In this case, you want the person/horse/team etc to win, and the bookmaker wants them to lose.

So in essence, a lay bet is betting on something not to happen.

Luckily, exchanges like Betfair Exchange allow us to place lay bets! On the Betfair website, any odds in the blue column are back bets. Odds in the pink column are lay bets.

Beginner strategy: laying the draw

Don’t get me wrong, there are plenty other Betfair trading strategies around. However, lay the draw is one of the most popular beginner strategies because of its simplicity and because it can actually work.

What you need to understand about any trading strategy is that successful traders don’t just pick a strategy out of a book and play it exactly as it reads. If it was this easy, we’d all be millionaires!

There’s also no hidden strategy that traders keep to themselves and protect with their life.

The truth is, people use pre-built “strategies” as a starting point and build their own strategy around it. They do this by adding slight variations after testing what works and doesn’t work for them.

Lay the draw strategy rules:

• Football game must currently be a draw (0-0, 1-1, 2-2 etc).
• Lay the draw when the odds are of value.
• Trade out (cash out/hedge your bets) once it is no longer a draw.

It’s really that simple.

Here’s an example trade with screenshots. You probably won’t want to leave it until this late in the game, but that’s personally where I find the best results overall.

Kibera Black Stars are playing Nairobi Stima FC  and at 90 minutes, the game is 2-2 with 5 minutes extra time. I also wouldn’t usually suggest betting on Keynan Super League games but each to their own I guess!

For whatever reason, I decided there was a good chance of a goal and most importantly, the draw lay odds of 1.14 were good value for the chance of a goal at the time.

It’s important to remember that it doesn’t matter if you think there’s going to be a goal, what matters is if the odds represent a different chance of a goal than what you believe.

This game is in its final minutes and the current score is a draw (2-2). I am about to place a lay bet of £2 (backers stake), which leaves me with a liability of £0.36 for a £2 potential return.

How can you tell if there’s going to be a goal?

The million dollar questions and the answer is…..

Nobody knows.

You heard it right, nobody has a fucking clue if there’s going to be a goal or not.

However, we can make an educated guess using parameters that we have decided in a advance of the game beginning. If we wait until half-way through the game to decide if we’re going to consider the amount of corners for example, we’re probably making a bad decision. Our emotions will be all over the place.

It’s entirely up to you which factors you consider to be important in predicting a goal. You may want to consider the amount of shots on target, the players on the pitch, past encounters and even the reason why each team needs to win this match or if they need to win it at all.

By absolute chance in this example, there was a 91st-minute goal. If I had actually placed my bet in time, my bet would have won as the game ended 2-3 (not a draw!).

In the example above, the game did result in a late goal and therefore, our bet would have won  (if I had placed it in time!). I’ll put a note in the diary to update this post with an actual example in the near future…

Once the goal has been scored, the match is no longer a draw. We should now be in profit and in order to eliminate any risk of an equalising goal, we should trade out now for guaranteed profit.

I can do sports trading me

Wehey! You made your first trade.

Make no mistake, your first trade was likely incredibly poorly informed with practically no planning or reasoning behind the trade. We’ll work on that another time… However, now you understand the physical steps needed to “make a trade”, which is something some people can take a while to get their head around.

Pat yourself on the back, have a beer or non-alcoholic beverage.

Just, don’t quit your day job quite yet.