What is a Betting Exchange

Using a Betting Exchange to Lay Your Bets

Quite a common misconception of matched betting is that it is plain gambling. This is simply not the case. In fact, matched betting is completely risk free with the help of betting exchanges.

Under normal circumstances of gambling, a typical punter would be backing a certain event, for example:

  • For a team to win a match
  • For a player to score first
  • For a horse to finish first

This type of bet, a back bet, is quite straight forward. You’re gambling with your back stake for potential winnings.

The Lay Bet at the Betting Exchange

The betting exchange is where you would place a lay bet. A lay bet is different to the situations above, in that your placing a bet for something NOT to happen, for example:

  • For a team NOT to win a match (this bet would cover the other team winning, and the draw)
  • For a player NOT to score first
  • For a horse NOT to finish first

By placing a lay bet to counteract a bet with the bookmaker, essentially you are covering all outcomes.

Image showing example of a betting exchange (Smarkets)

Betting Exchanges and Matched Betting

Matched betting is called as it is because matched bettors always place a lay bet at the betting exchange to match their back bets at the bookmakers – hence a “matched bet”. Matched bettors never leave any bets un-matched as this would mean that risk is involved.

Cashing Out Free Bets

The betting exchange simply means you don’t win any money with your bets, but you don’t lose anything either. But if you use lay bets when placing your initial qualifying bets at the bookmakers, this will then unlock  your free bets. Carry out the same procedure, and BOOM, you’ve cashed out the free bet completely risk free.

Examples of Betting Exchanges

All of the exchanges are pretty much the same, but they will differ in commissions and what events and markets they trade with. You will find that Betfair has the greatest coverage.

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