A Beginner’s Guide to Spread Betting
June 26, 2008
A BEGINNER’S GUIDE TO SPREAD BETTING
What is Spread Betting?
Spread betting is an exciting, fast-growing and stimulating form of betting, which offers the client a huge selection of different options to those offered in the fixed odds markets. Contrary to the opinions of many novice punters, spread betting is not complicated. Although numerous spread betting opportunities exist regarding financial markets (UK 100 index etc.), these are not particularly popular with the average punter, so this piece focuses on sports spread betting for the sake of simplicity. There is a huge variety of betting opportunities, but they all rely on one fundamental principle. Once the simple concept is understood, spread betting becomes immediately comprehensible.
Many punters have found that spread betting greatly enhances their watching of sports events, adding an entirely new dimension.
How does Spread Betting work?
A Spread Betting Firm, Betfair being one of the best known, makes a prediction on the result or a specific aspect of a sporting event. This may range from the number of points a team will score in a Premiership season to the number of goals scored in a football match, the number of runs scored by a team in a cricket innings, or the total starting prices at a race meeting.
The punter obviously will have an opinion as to the accuracy of such a prediction. If the prediction is considered too low, a “buy” is in order. Similarly, if the prediction is considered too high, a “sell” bet is appropriate. Obviously, if the prediction is considered “spot-on”, then betting either way is throwing money away. Select a stake and you win / lose the difference between your prediction and the bookmaker’s multiplied by your stake. (See examples below). One of the joys of spread betting is the amount won or lost depends on how right or wrong you are.
Spread Betting Explained
Football Example
Say, in an FA Cup match between Chelsea and Barnsley, Betfair are of the opinion that 3 goals will be scored. A punter who thinks that Chelsea will win, say, 5-0, chooses to buy at 3, for £10 per goal. If there are 5 goals in the game, regardless of the result, he wins:
(5-3) x stake (£10) = 2 x £10 = £20.
However, say Chelsea win 1-0. In this case, a loss is incurred, of
(3-1) x stake (£10) = 2 x £10 = £20.
This is of course a very simple example. Other football spread betting includes Time of First Goal, Time of First Booking, Total Goals, Superiority, Total Bookings, Total Shirt Numbers, Total Corners, Performance Rating, and many others.
Cricket Example
Predict the total number of runs a team will score in an innings.
Example:
England innings runs 260 - 275
This quote says that England’s total runs in an innings will be between 260 and 275.
If you think it will be more than 275, you would go higher (buy), say, for £10 per run.
If you think it will be less than 260, you go lower (sell), say, for £10 per run.
England’s total runs for the innings is 225.
Sellers at 260 would win (260 - 225) x £10 = 35 x £10 = £350.
Buyers at 275, you would lose (275 - 225) = 50 x £10 = £500.
Horseracing Example
Predict the combined total of starting prices of winners at a meeting. Prices that make fractions are rounded up (i.e., 9/4, which is 2.25, would be worth 2.3). The maximum for one winner is 100 (i.e., any winner with a starting price greater than 100/1 will only be worth 100).
Example:
Ascot Starting Prices 50 - 57
This quote says that the combined starting prices total of the winners at the meeting will be between 50 and 57.
If you think it will be more than 57, you go higher (buy), again for £10 per point
If you think it will be less than 50, you go lower (sell), for £10 per point.
The combined starting prices total for the meeting was 49.
If you had sold at 50, you win (50-49) = 1 x £10 = £10
If you had bought at 57, you lose (57-49) = 8 x £10 = £80.
Risks Associated with Spread Betting
Spread betting carries a high level of risk to capital and can result in losses far in excess of the initial deposit/stake. It is not suitable for everyone, so it is vital to have a full understanding of the risks involved. NEVER become involved in any form of spread betting where the total potential loss is not understood. Volatility varies greatly dependent on the market in question. For example, using the above examples, a £10 per goal football bet carries far less potential liability than a £10 per run cricket bet. If uncomfortable about any aspect of spread betting, there a several excellent tutorials and beginners’ guides to spread betting dispersed about the Internet. However, rather than venturing into unknown territory a “portfolio” of online betting accounts with the major online bookmakers can serve a similar purpose. The better online layers such as Victor Chandler, Paddy Power, Blue Square etc. offer the equivalent of the above-mentioned types of spread bets as “under / over” fixed odds bets. These layers, along with the likes of Bet365 and skybet also offer “in-running” prices on most sporting events, so (perhaps surprisingly) many of the benefits of spread betting can actually be obtained without ever having a spread bet.
All odds correct at time of writing. Please click here for the latest odds
Weighing the odds in Sports Betting
June 25, 2008
WEIGHING THE ODDS IN SPORTS BETTING
Understanding Betting Odds
As a novice punter, a knowledge of betting odds and the associated terminology is imperative.
Stake
This is simply the amount of money a punter bets on a given event.
Odds
Odds are based on a bookmaker’s estimation of the probability of a particular outcome of a sporting event. Odds are dynamic and will fluctuate as bets are taken at the odds offered. If one team / player is particularly popular with the punters, the bookmaker will shorten those odds (i.e. offer lower odds) and / or lengthen the odds (i.e. offer higher odds) on the opposition in order to attract more people to back the lesser-fancied rival. If an outcome is referred to as being at short odds (or a short price) the bookmaker’s opinion is it more likely than an outcome at long odds (or a long price).
Odds Against
If you back a selection at “odds against”, a winning bet will return more than twice your stake. For example, £5 on a 4/1 winner will given a return of 4 x 5 = £20, plus the stake = £25. In sporting matches, the weaker team / player is often offered at odds against, as they are not expected to win.
Even Money
Even money or evens is perhaps the easiest of all odds to understand. A winning bet at evens wins the amount staked. For example, £5 at evens wins £5 which, plus the original stake, gives a total return of £10.
Odds on
Favourites in sporting matches are often quoted at “odds-on”. This means that a successful bet wins less than the stake. For example, £6 at odds of 4/6 wins £4 and a return of £10.
Odds are represented as fractions or decimals. Traditionally, fractions were always used (in the UK) but the advent of the betting exchanges has seen decimal odds become more popular. Online bookmakers allow users the option to view the odds in their preferred format.
Types of Bet
Win Single
This is the simplest and probably most popular bet of all. It usually relates to horse or greyhound racing, and your selection must be placed first for the bet to be successful. For example, suppose you had £5 on recent Royal Ascot winner Lush Lashes, at 7/1. Having watched the filly in question canter home in front, your return would be 7 x £5 = £35, plus the stake = £40.
Each-Way Single
An each-way bet is actually two bets; one for a win and one for a place, hence an each-way bet requires twice the stake of a win bet. Suppose you had backed the same horse as above, but to £5 each-way. The win part of bet still returns £40. However, there is also the place part of the bet to consider. The place terms were ¼ the odds for finishing in the first 3. So, there are additional winnings of £5 at 7/4 = £8.75, plus the original £5 stake = £13.75. The total return is therefore £53.75. If Lush Lashes had finished second or third, the win part of the bet would have been lost, leaving just the place return of £13.75. Obviously, had she finished out of the first three, the whole bet would be lost.
Multiple Bets
Multiple bets involve 2 (double), 3 (treble) or more selections (accumulator), all of which must be successful in order to win the bet. Despite the fact that bookmakers continually offer bonuses associated with multiple bets, they are NOT suitable for betting on horse or greyhound racing. The reason bookmakers are so eager to entice punters into placing such bets is that the profit margin is huge. However, multiple bets are useful for a number of short-priced selections, which, if backed singly would require too large an outlay. This can apply to football, tennis and a number of other sports. There is the potential for substantial reward for a reasonable outlay.
Setting Objectives
When betting on sporting events, it is important to clarify at the outset what you seek to achieve. For example, if you set out to win, say, £100 and are fortunate enough to achieve it, pocket your winnings and retire for the day, wearing a smug grin.
Finding the Best Odds
The simplest way to find the best odds for any sporting event is to use one of the many Internet “odds comparison” sites. Such sites compare odds from leading online bookmakers such as Ladbrokes, William Hill, Blue Square, Bet365 etc. and alert the punter to the best odds on offer. In order to take advantage of the best odds it is necessary to have several (possibly 5 or 6) accounts with different bookmakers.
When to Place Bets
The timing of bet placement can be a crucial factor in getting on a the best odds for a sporting event. This can vary widely dependent on the sport in question. Generally, for horseracing and greyhound racing it is wise to take early prices, especially when they are guaranteed, as is the case with Stan James, i.e. if the starting price is greater, you get paid out at the SP. Prices for football matches do not fluctuate greatly, unless a bookmaker is offering one team at what appears to be too big a price. For Formula One, the choice is to take a longer price prior to qualifying or a shorter price when starting grid positions are known. The latter is recommended.
Responsible Gambling
Gambling can be, and for the majority of people is an enjoyable pastime. However, there are several points which every punter should bear in mind. It is imperative for every punter to set a limit on the amount the can afford to bet, not what they would like to bet in an ideal world. Self-discipline is required to walk away once this limit has been reached. Many punters are taken in by “guaranteed” winning systems for sale on the Internet, often at exorbitant prices. Sadly there is no such animal. Finally, avoid the trap that so many punters fall into, of chasing losses. There is always another day.
How Sports Betting works
June 25, 2008
HOW SPORTS BETTING WORKS
A simplistic definition of sports betting is wagering on the occurrence of an event. If the predicted event occurs, the bet is won, otherwise it is lost. The huge range of events and markets available makes betting on sport a satisfying activity for professional and casual punters alike. It is based on the same fundamental principle as any other type of betting, namely that the “book” should not lose money. Bookmakers, assisted by specialist odds compilers, advertise odds dependent upon their estimation of the probability of a certain event taking place.
Such odds are not static and can change with trends in the betting market and the time remaining prior to the event. Prices are dynamic because if too much money is bet on one outcome, the bookmaker has a large liability should that team / player win. Like punters, bookmakers are always looking to reduce their liability and will attempt to attract money on the opposition. The bookmaker will increase the price of the opposition to make the odds more appealing to punters and / or shorten the price of the well-backed contender to discourage further investment. After odds are published, backers place bets at what they believe to be the most favourable odds. If the punters win, they receive the stake they bet as well as the money won. Payment is usually via credit / debit cards or online transaction facilitators, e.g. PayPal. Online bookmakers such as William Hill, Ladbrokes, Bet365 etc. offer extremely competitive odds and also provide customers with the option of placing many specialty bets.
There are many variables that can affect the result of a sports bet. Some of these factors are objective, such as goals or points scored. However, others are subjective, such as the absence of a football team’s leading striker. Punters can, if they wish, take advantage of the free advice offered by many online sporting tipsters. There is also free software available online that aids in “factoring in” the numerous variables that affect sporting events. An important point that is missed by the majority of sporting punters is the need to specialise. Such specialism can give the punter an edge over the bookmaker, especially with less popular sports, as the punter’s knowledge is likely to be superior to those pricing up the event. In this way, value bets can be obtained. Regardless of experience and competence, no punter can realistically hope to have the knowledge to deal competently with more than two or three sports.
Sadly, too many punters get involved in betting on events of which they have little or no knowledge / experience.
Overround
The overround is the method by which bookmakers such as Blue Square, Victor Chandler, and Boylesports make their profits.
Consider the following:
The odds for selecting a particular card from a standard deck of 52 are 51/1, a probability of 1/52 = 0.0192308. The sum of the probabilities for all the cards will be 52 x 0.0192308 = 1. Any bookmaker offering odds on picking a particular card would need to reduce the 51/1 odds to, say, 45/1 in order to give himself an edge. Such odds are obviously unfair, as the probability is now 0.0217391, higher than the true chance of picking a card.
This makes the sum of the probabilities 52 x 0.0217391 = 1.13 or 113%. From a purely mathematical perspective, the sum of the probabilities must be 1 or 100%. The difference between these two figures represents the profit margin for the bookmaker. The book is overround by 13% or has an overround of 113%, so for every £100 paid out, the layer can expect to receive £113, a profit on turnover of 13%. Since the true probabilities are mathematically fixed, a punter would surely need to be a very special type of “mug” to bet at the odds on offer. Bearing this in mind, is it not absolutely extraordinary that so many gamblers are quite content to bet on casino games with similar odds? It is possible to gain an edge, for example, by counting cards in Blackjack. However, casino rules will ban card counters, so their knowledge is worthless.
However, betting on sports is a slightly different story. The “fair” odds of a particular outcome cannot be predicted by mathematical means. Punters, armed with the faith that they have superior knowledge to the odds compilers, are prepared to accept the overround, in the hope that the bookmakers fair odds estimation is wrong, allowing him to overcome the overround drawback.
Overround Percentages for Popular Sports
Football
Football bets are usually presented for 90 minutes play, with prices for a home win, draw and away win. Generally overround percentages are in the region of 110%. Obviously, the accuracy of a bookmaker’s estimation of the true odds for a result is a matter for conjecture. If a punter’s estimate is more accurate he has a chance of making a profit. Other football bets are subject to different overrounds. Generally, the greater the number of possible outcomes, the greater the bookmaker’s margin. Correct score betting has numerous possibilities and attracts an overround of up to 160% in some books. Contrastingly, total goals (e.g. under/over 1.5 goals) has only two possible outcomes with a typical overround of less than 110%
Match Betting
Punters seeking to minimise the bookmaker’s advantage are advised to investigate match bets in tennis, Twenty20 cricket, snooker, or indeed any sport where there is no draw involved. These can present punters with some excellent money-making prospects. For those with an interest in US sports, it is worth noting that handicap and total points betting on American football and basketball attract the lowest overrounds of all, sometimes as low as 103%
All odds correct at time of writing. Please click here for the latest odds
How does Sports Arbitrage betting work?
June 12, 2008
HOW DOES SPORTS ARBITRAGE BETTING WORK?
An arbitrage situation occurs in sports betting when bookmakers’ prices differ by a sufficient margin that they allow punters to back all the outcomes of an event and still make a profit. Imagine that old adversaries Roger Federer and Rafael Nadal are priced up in a tennis final as follows:
Ladbrokes offer 6/5 Federer and 8/11 Nadal
Bet 365 offer 10/11 Federer and 10/11 Nadal
Backing each player for a return of £1000, at the best price available, requires £454.55 on Federer at 6/5 and £523.81 on Nadal at 10/11 with Bet 365, a total stake of £978.11.
If Federer wins, £454.55 @ 6/5 returns £1000.01, less the total stake of £978.11 = £21.90 profit
If Nadal wins, £523.81 @ 10/11 returns £1000.00, less the total stake of £978.11 = £21.90 profit
Whichever player wins, a profit of £21.90 is assured. This is the principle of Sports Arbitrage Betting.
To further reinforce the idea, consider a rugby international between New Zealand and England:
Blue Square has odds of 1/10 on New Zealand and 7/1 on England (draw, no bet).
William Hill has odds of 1/5 on New Zealand and 4/1 on England (draw, no bet).
Using the same idea as in the previous example, i.e. backing both sides for a return of £1000, requires £833.33 on New Zealand @ 1/5 with William Hill, and £125 on England @ 7/1 with Blue Square, making a total stake of £958.33.
If New Zealand win, £833.33 @ 1/5 returns £1000.00, less the total stake of £958.33 = £41.67 profit
If England win, £125 @ 7/1 returns £1000.00, less the total stake of £958.33 = £41.67 profit
Again, a profit is guaranteed, regardless of which side wins.
Sports Arbitrage Applications
Knowledge of sports arbitrage betting can be used in several ways. The majority of arbitrage punters use it to achieve small percentage profits. However, finding such opportunities for yourself can be extremely time-consuming, and, given the small margins, may not be worthwhile. The process of finding sports betting arbitrage opportunities can be aided greatly by the use of “odds comparison” sites, such as http://searchum.bestbetting.com/, which list all the leading bookmakers’ prices on an event on a single page. There are also companies which offer to find arbs, alert you to their location, their profit percentage, and how much to bet on them. These services are subject to paying a subscription.
Most sportsbooks offer sign-up bonuses for new players. These bonuses will usually involve a condition which states that the bonus money must be bet a number of times before it can be withdrawn. Arbitrage can be used to preserve these bonuses without the worry of losing it before being able to withdraw it.
Arbitrage can also be used when you simply want to bet on a game without risking losing your money. Assuming you can find an arb on your event, instead of simply placing a bet on your team, place the arb with one side backed for the maximum and the other side only covering the bet. In the rugby example above, the £41 guaranteed profit could be used to back one side for more. For instance, if confident of New Zealand winning, bet them for £875 and England for £125. Should England win, the extra gamble only means you don’t win anything. However, if correct, £875 @ 1/5 returns £1050, £8.33 more than the standard arbitrage trade.
Risk Factors
Arbitrage opportunities are generally limited to just a few per cent profit, hence stakes are likely to be large. The first difficulty arises, however, if a bookmaker imposes limits on the maximum size of a stake. Since an arbitrage bettor’s stakes are likely to be larger than most, this problem may occur quite frequently.
A second problem is the ongoing problem concerns the effects of deposit and withdrawal costs, and in some cases currency transaction costs as well. For certain types of deposit, and with a number of internationally based online bookmakers, these additional costs can be anything up to 5%. Given the small profit margin, these costs can annihilate any profit. The best way to avoid this is to try to minimise your deposits and withdrawals.
A third problem is that some bookmakers only allow bets in a particular currency. These are mainly the small bookmakers. The best way to avoid this scenario, and the problem of “getting on” with larger stakes is to maintain a number of accounts with the larger bookmakers such as Stan James, Paddy Power, 888sport, skybet, Boylesports etc.
I’d Do Anything: Find a Nancy Final
May 31, 2008
Edit: Congratulations to Jodie who won the part as Nancy in I’d Do Anything.
Not only have we got the final to Britains Got Talent tonight, we also see the end of a 10 week run where Andrew Lloyd Webber has been trying to find a Nancy in I’d Do Anything on BBC 1.
Tonight at 6pm we see the remaining three Nancy’s going head to head for your vote. Sir Andrew doesn’t have a say tonight as you choose his next Nancy for the new production of Oliver to hit the West End.
Who are the Nancy’s?
Jodie is 28 years and an agony aunt though she has experience in circuit singing and on a cruise ship. She is tipped as the favourite by the bookies where you can find odds of 6/5 at William Hill.
Jessie is just 188 years old and has been a firm favourite of mine since Francesca was kicked out. She has a varied experience through the entertainment world from singing to dance. She stands in second place at the moment with odds of 5/12 available from totesport.
Samantha is 17 and stands in third place with the bookies. She has won a number of awards for her singing, and has supported the Sugababes. Although in third place with the bookmakers, her odds are 3/1 from Paddy Power which just goes to show how close the competition is.
There really isn’t much to choose from each of these girls, so it’s all up to their performances tonight.
The odds stated are correct at the time of writing, for the latest odds check the table below:
Tonight’s I’d Do Anything
There are two live shows this evening, the first one is at 6pm and will see the loss of the first Nancy from the final. The second show at 8.45pm will see the sing off between the last two contestants. You will need to vote at each stage to save your favourite Nancy.
Let us know who your favourite Nancy is by leaving a comment below.
