What is Lay Betting?
Lay Betting is the option on the betting exchanges such as Betfair where punters can play the role of a traditional bookmaker but offering odds to sell a bet instead of the usual odds to back a bet.
“I bet you won’t get a bullseye”
“I bet you won’t finish all that”
“They’ll never win if he plays.”
We all make statements to friends like this every day. What you’re actually doing is ‘laying a bet‘: betting something won’t happen.
Betfair have made lay betting possible
For example, have you ever thought Roger Federer was way too short to win an event, but couldn’t decide who was going to win the tournament?
Problem solved – by laying Federer, you are effectively backing the field to beat him. Much easier to cheer the whole field!
Like anything too good to be true, there is a catch. Should your selection win, you’ll pay the backer his winnings, which could be a lot more than the stake. Just be careful how much you decide to lay.
Laying bets sometimes causes controversy because you are betting on someone/something losing – but it has always happened that way.
If you back one horse to win a race, then by default, you are betting AGAINST every other horse in the race – you can’t cheer them all to win!
Betfair simply make the process simpler, cutting out the bookmakers’ margins.
In many sports or markets, such as a tennis match or under/over 2.5 goals in football, betting on one side is exactly the same as laying the other option.
How do the odds work for laying?
Imagine two everyday scenarios – flipping a coin and rolling a dice.
You and your mate each put a fiver on the coin toss. One calls Heads, the other gets Tails, and whoever wins gets £10.
You backed Heads for £5 to win another £5. The odds you received were evens or 2.
Or looking at it another way:
You laid Tails. You let your mate have £5 on Tails to win another £5, at odds of 2.
Either way, if it lands Heads, you win a fiver, if it lands Tails, you lose a fiver.
In a two-horse race, backing one side means you are laying the other.
So what happens when the odds aren’t even, or there are more than two options?
Think of a standard dice (or die). Pick a number. Your mate will pay you every time it lands on six.
What odds should it be?
It can’t be evens or 2, because that’s not fair – you’ve got much more chance of losing than winning.
Chances of winning – one
Chances of losing – five
The true price of this bet is five to one, or in decimals, 6 (potential profit plus your stake).
So your mate agrees to pay you the true price if you roll a six. You put down £1, he risks £5.
If your price is 5/1, what price is he getting for his bet?
He has five chances of winning, and only one chance of losing. So the odds are 1/5 or in decimals, 1.2.
If you’ve noticed the similarity, well done. It’s simply ‘flip the fraction‘ to work out the other side of the bet.
True odds (such as 5/1 v 1/5) represent an efficient market
This occurs when all the money going into the market equals all the money being paid out in the market – there is no leakage or profits being taken.
Efficient betting markets rarely exist outside of betting exchanges – bookmakers need to reap a profit in order to run a business.
Betting should all come down to weighing up the risk versus the reward.
Laying at 2 will win you more if you are correct, but it is more likely to happen than laying at 6. But laying at 6 will cost you more should that result occur.
Backing at 2 is more likely to happen, but you won’t win as much compared to backing at 6. And if you have bet to win a certain amount, then backing at 2 will cost you more if the selection doesn’t win.
Your liability is the amount you could lose in your worst-case scenario.
When backing it’s simply the stake which you place. When laying however it’s the amount it will cost you if your selection wins. Either way, it is how much you are risking.
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