Today I’m going to explain what lay bets are and how they work. Before we get started, I’m going to assume that you’re familiar with what betting exchanges are and that you’re comfortable using decimal odds. If you need a recap on either of those topics I suggest you click the links and read those articles first.
Done that? Good, let’s get started.
Lay Bets Explained
A lay bet is a bet that something will not happen – a football match not to end in a draw, a player not to score a goal, a horse not to win a race etc.
Lay bets are the exact opposite of back bets. If you’ve ever placed a bet with a bookmaker, the bookmaker was actually also placing a lay bet with you.
When you place a lay bet, you accept a stake from a backer, and agree the decimal odds at which the bet will be placed.
- If the outcome that you have layed is the final result, your lay bet loses, and you must pay the backer his winnings based upon the decimal odds agreed.
- If the outcome that you have layed is not the final result, your lay bet wins, and you get to keep the backer’s stake money.
For example, let’s say you want to place a lay bet at decimal odds of 2.20 and you want to accept a backer’s stake of £10.
If the back bet is successful, you must pay the backer his winnings of £12. His stake will also be returned to him by the betting exchange.
If the back bet is not successful, the exchange pays the backer’s stake of £10 into your account.
Note that, as with back bets, the exchange will charge between 2% and 5% commission which is payable only on your winnings in a particular market. If you lose, no commission is paid.
In trading terms, placing a lay bet is the equivalent of buying a bet. You are offering to buy a bet from a backer at the agreed price.
Some people struggle with the concept of lay bets at first, as this is a relatively new method of betting as far as the public is concerned (although obviously the bookmakers have been doing it for years).
The key thing to remember is that laying is the direct opposite of backing – for every back bet there must be somebody placing an equivalent lay bet.
Laying may be new to you but you should not be frightened by it. It will very soon become second nature as your experience with the betting exchanges grows.
When laying, you are always in control of the size of bet you want to buy, and therefore you always know how much you stand to win or lose.
How to place a lay bet on Betfair
Let’s return to the Atletico Madrid v Liverpool market that we looked at earlier. This time, let’s place a lay bet on Atletico Madrid at 2.52 by clicking the pink square.
As before, when the pink square is clicked, a bet slip pops up under the “Place Bets” tab on the right hand side of the screen.
This time, instead of asking me how much I want to stake, the bet slip asks what size of backer’s stake I want to accept. When I enter £10 in the box (arrow #1), the slip tells me that the liability I have on this lay bet will be £15.20.
This means that if Atletico win the match I will have to pay £15.20 to the backer. If Atletico do not win the game, I will be paid the backer’s £10 stake.
As before, I can opt to submit this bet by clicking the “Place Bets” button (arrow #2) or cancel by pressing the red X on the left hand side.
Once I click “Place Bets” the bet is final and cannot be cancelled or amended.