Understanding Lay Bets?

On a betting exchange i.e Betfair you can make money out of something losing, by Laying a selection. Laying a bet means, you are betting on something not to happen – a match not to end in a draw, a horse not to come in first, a rugby team not to win by over 7 points.

It might sound new, but you’ve probably been Laying bets unconsciously for years. Have you ever had a bet with a friend, it might have been over a game of a pool, or a football match on TV. Two opposing sides, two opposing opinions. They think team A will win, you think it won't. In this situation your friend is backing their team – if team A wins, they win. If team A loses, you win – you’ve effectively layed their bet by betting on something not to happen. That Team A will not win. 

Essentially when you lay a bet you adopt the role of a bookmaker, the lay stake is the amount you stand to win from the bet, and the liability is the amount you stand to lose. Let’s take a look at an example comparing the difference between a Back and a Lay bet and all of this will soon become clear. 


THE BACK BET 

In Coral, if I place a £10 Back bet on England to win at odds of 5.00, when I place the bet, the £10 will be immediately deducted from my account. If England Lose or Draw, I will lose the £10 permanently from Coral. 

However if England win I will win £50. Note the £50 will include my original £10 stake so overall I will have made an actual profit of £40
See calculations …

Winnings = (Stake x Odds)     (£10 x 5.00) = £50 
Profit = (Winnings – Stake)    (£50 - £10) = £40 


THE LAY BET

Now on the flip side let’s think of this from Coral’s perspective. Coral have risked their own £40 for a chance to win my £10. Their liability for the bet is £40 and their potential gain from the bet is my £10. Now try to remember this as this is exactly the same as it is for a LAY Bet. 

In Betfair Exchange, if I place a £10 Lay bet on England NOT to win at odds of 5.00, my £40 liability for the bet will be immediately locked away from my Betfair account. And if England win, I’ll have the £40 liability permanently removed from my account. 

However if England lose or draw the £40 liability will be returned to my account and I will also win my LAY stake amount of £10. 

So for LAY bets, your LAY stake is how much your LAY bets stand to win
AND 
Your liability is how much your LAY bets stand to lose

Don’t be scared by high liability’s though, because whatever you lose at Betfair you will win back at the bookie. In the example above even though my liability is £40, even if I lose that £40 at Betfair I’ll still win it back at Coral because that was how much the BACK bet was going to win. 

Let’s take a look at another example with low Lay Odds. 

In Coral, if I place a £10 BACK bet on England to win at odds of 1.50. Again when I place the bet, the £10 will be immediately deducted from my Coral account and if England lose or Draw I lose the £10 permanently from Coral. 

However if England win, I’ll get £15 back, which is again my stake multiplied by the odds. This £15 will include my original £10 so I will have made an overall £5 profit. 

On the flip side, If I place a LAY bet on England NOT to win at LAY odds of 1.50, then my liability will only be £5. Even though my LAY stake is £10, I will only need £5 in my Betfair account to place this bet. In other words your liability can be lower than your stake if the odds are low enough. 

Now for adding up your profit and loss. The first thing you’re going to want to do is go to Betfair and find your way to your account statement, see image …



This gives you a nice list of all the transactions on your account, I can see a description of everything I’ve bet on, the odds, the stake, whether the bet won or lost and how much I won or lost. You also want to load up the bookie website and find your bet history on there. 



Now normally it’s a simple case of comparing how much you won at one site and how much you lost at the other. Now on the Betfair statement everything in the CR column is a win on Betfair, no this doesn’t include your stake or your liability or anything like that, it’s just how much you actually won on Betfair. Anything in the DR column is something you have lost on Betfair, I would then go and compare that against the bookmaker and see what I won or lost there. The only difference is at the bookie on normal bets your stake is normally included in the return figure so you’d need to deduct that manually. 

So for example here on Skybet, let’s says I won £50.00 on a bet, my original stake here was £25 (to qualify for a matched £25 free bet) so I only made £25.00 profit on Skybet. As it turns out, I lost £26.01 on Betfair. So I would do £25.00 - £26.01 = -£1.01 overall loss (a normal acceptable loss to obtain my free bet). 

I’d then do the same thing to work out the profit from my £25 free bet. Let’s say I made £20 from this (again 80% profit margin from free bet is normal) and deduct my initial loss, so £20 - £1.01 = £18.99 overall profit. 

Remember all of these calculations and tallying up your profit after each bet is optional, you don’t need to do this although it can be good practice as we have matched betting software that does all of this for you. Moreover, if you place your bets via our Matched Betting System found in your member’s area, all of your bets will be logged automatically and you can check your exact bet history and outcomes there. This guide is purely to explain exactly how these bets are making profit but if you’re confused by the numbers please don’t worry about it as you don’t really need to know all of this. 

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