Sports trading is a more sophisticated approach to betting on sporting outcomes that allow gamblers to sell their positions before the conclusion of a sporting event. It is similar to investing in stocks and shares in that participants seek to buy low and sell high in order to make a profit.
Compare Betting Exchanges for Sports Trading
|Betting Exchange||New Account Offer||Our View & Reviews||Commission||Liquidity||Founded||Visit Site|
|£10 no risk bet for new accounts Claim Offer||Some really good innovative features. Smarkets Reviews||2%||Can be a little thin on secondary markets||2008||Visit Smarkets|
|Up to £1,000 commission cash back Claim Offer||Superb all round exchange – recommended. BetDaq Reviews||2%||Excellent liquidity on all markets||2000||Visit BetDaq|
|Up to £500 commission cashback Claim Offer||Great for US sports. Matchbook Reviews||1.5%||Very good for US & Asian sports through||2008||Visit Matchbook|
|Betfair||£10 risk free bet Claim Offer||Probably the best bookie in the world. Betfair Reviews||5%||Best all round liquidity||1999||Visit Betfair|
Compare Sports Spread Betting Bookies for Sports Trading
|Bookie||New Account Offer||Reviews||Features||Our View||Founded||Visit Site|
|Spreadex||iPad or £300 cashback in your first 28 days|
|Financials: FixedOdds: Casino: Regulator:FCA||Excellent service and credit facilities.||1999||Visit Spreadex|
|Sporting Index||£100 to get you started|
Sporting Index Reviews
|Financials: FixedOdds: Casino: Regulator:FCA||Dedicated to sports spread betting – very good.||1992||Visit Sporting Index|
How sports trading works
The process of sports trading is facilitated by betting exchanges or sports spread betting bookies which allow punters to gamble on outcomes in precisely the same way that stock exchanges allow investors to gamble on stock prices. Betfair is among the worlds most popular exchange sites, along with Betdaq who also provide top exchanges. They allow anyone to act as a bookmaker and offer odds on a particular outcome. This is called laying. Punters can then decide whether or not they want to take those odds. Another that is worth considering is Matchbook, who have become very popular in the exchange betting world.
The key difference with conventional betting is that instead of being locked into holding your position until the conclusion of the event, gamblers can sell on their position at any time at whatever the market rate is at that particular moment.
How to get started with sports trading
To get started in sports trading, a betting exchange account is an obvious prerequisite. Some knowledge of the sport you intend to place bets on is highly advisable. The more that you know, the more likely you are to make a profit. Click here to compare the best betting exchanges.
How Sports Trading Works…
Sports exchanges work just like any other financial markets out there.
Traders from all around the world use the exchange to place bets against each other. Betfair acts like the middleman or referee if you please. Betfair is any other sports trading site give you real-time information from thousands of football matches, horse races and many other sports. Betfair makes sure the winners get paid and the losers pay up. But Betfair takes a 5% cut on all winning bets as you would expect for providing a service like this.
However, the more you turnover you generate the less commission you will have to pay. The lowest commission rate on Betfair is 2%, but you would have to be a big player to get your commission rate down that low.
Other Exchanges such as Smarkets and Betdaq also offer a permanent low of 2%. Liquidity is anywhere near as good though – making it tough to match bets without added risk.
When you place a bet at a traditional bookmaker, you are nearly always placing a back bet. This means that you are betting/predicting that something will happen in any given sport of your choice.
By accepting your bet, the bookmaker is effectively placing a lay bet. They are betting against you that your prediction will not happen.
Exchange such as Betfair, Smarkets and Betdaq allows you to place both a back and lay bet. By doing this procedure multiple times, you can produce a guaranteed profit no matter what the outcome.
Betopin will show and explain the tools of a successful trader. Before we do, keep in mind that using betting exchanges are so much different to using a bookmaker in the sense that they won’t limit or ban your account unlike some online bookmakers, plus you will nearly always get a better price.
The only downside being; some additional charges may apply for the highly successful traders.
Successful Sports trade
To make a successful trade in any instance, you have to have a reason you expect the price will move, or at least get both your bets matched.
For the sake of this explanation, assume you are very confident the price will move on Mershardal. Meaning Mershardal is likely to drift in price, being shorter than it currently is before the start of the race. You open the trade by placing a lay bet at [4.8] 5 minutes before the start of the race. Your lay bet of £/€100 is fully matched, as seen in the image below.
At this stage you have a lay bet.
We have highlighted in the red box the liability at stake.
As expected Mershardal’s price has drifted like a barge. This leaves you in the pime position. You now have a bet that is of value when compared to the current market price in the market
Why? Because if you lay at the current price, you would have to outlay more liability. Assuming now you expect the price to be where it should be, or better still, higher than you were expecting. You simply need to ‘trade out’ of your position. Closing the initial bets liability, in other words the amount you previously stood to lose.
Now you are in a position where you will profit should Mershardal win the race, but nothing should he loose.
In order to spread your result, be it profit or loss, you need to hedge up. Otherwise known in the sports trading world as greening.
To do that, you can use software (it saves extra calculations). Basically, there needs to be an extra lay bet in our example to guarantee a profit. No matter what happens – before the start of the race. I’ll explain the different stakes and why that is in a moment. For now, take a look at the ‘hedged’ image below….
And there you have it, a successful sports trade.
You’ll see on the right of shot (above) that ‘average odds’ is ticked. This means our backers odds have changed a little along with the lay stake, this is because you had to place a ‘hedge’ bet of £/€9.43 at the available price.
Things to avoid when sports trading
The first thing to bear in mind is that gambling via a betting exchange is still gambling. You shouldn’t bet more than you can afford to lose. It is easier to limit your exposure to risk when using betting exchanges than when placing a bet with a traditional bookmaker. However, watch out for markets with low liquidity. If no-one will buy your position then you’ll be stuck with it until the event concludes.
Losing money when scalping meant you didn’t trade well. You made bad predictions, you chased your losses or you had bad internet connection. I cannot think of another reason to lose money. No, the rule of “cutting your losses short and letting your winners run” does not apply in scalping. That’s because you always cut your losses short and you seldom let winners run in scalping. Thus, if you do not cut your losses early on, you are not scalping but gambling.
- Bad predictions: In scalping, much like in trading, you make money when you predict odds movements correctly. If you constantly trade in the wrong direction, you are going to be broke. In scalping, that means you suffer many small losses instead of scoring many small wins. By improving your predictions in scalping, you increase the win/lose ratio, not the money won/lost per trade. This means you will ultimately have a lot more winning trades, yet the net amount won per each trade will remain about the same. I’ll explain later how I improved my predictions in horse racing and in pretty much any other market I traded.
- Chasing your losses: This is lack of discipline. Being a scalper, sports trader, a position trader or an investor, chasing your losses is one of the biggest leaks. This leak can and will bring any profitable strategy to its knees. Chasing losses is found in any form of gambling, therefore if you caught yourself doing that, you are not ready yet for sports trading. Because of the high betting frequency in sports trading, your lack of discipline can have a devastating result in a much shorter time. Make sure you are not prone to tilting and losing temper, before delving into sports trading.
- Bad internet connection: This doesn’t need much explanation. If your internet goes down during a trading session, you are toast. You should have a backup plan in case of that emergency, which usually includes a backup internet connection. That second connection does not need to be that fast but it should be reliable. You are only going to close your open trades with that.
In fact, there is another reason to lose money in sports trading before the horse race starts, but I needed a headline instead of a bulleted list to address it.
Never go in-play when sports trading
‘Unreal’ horse went on to win the race and left me with an open trade that cost me my entire bankroll. Pretty unreal, indeed!
Unless you were supposed to trade in-play, letting a trade open on the race’s official starting time is a recipe for disaster. But why would you do that in the first place?
- You are losing more than you expected in the regular trading session and are looking to gamble a bit to recoup losses quickly.
- You are aiming for that one tick to get out of the market but odds seem to have come to a halt.
- Races start on a specific time, which you missed. Although today’s trading software set alarms on for you to avoid that error, you’d be surprised how often traders neglect to keep an eye on their clock!
Whatever the reason you are willing to let a trade go in-play, restrain yourself from doing it ever again! Accept your loss, take your one-tick-less profit and move on to the next horse race. Trading never ends, the next opportunity is just a click away.
You have no excuse to put your bankroll in such a high-risk environment.
Even if you trade in-play, you still need to be disciplined enough to trade out with a hefty loss.
In-play sports trading demands a different approach and certainly puts you in a severe disadvantage when you are risking 50% or 100% of your trading capital! And speaking of capital, let’s now say a few words on money management.
Things to look for when sports trading
The way to make a profit in sports trading is to look for value from a sports spread betting bookie. You’re not necessarily looking for winning bets. Instead, you’re trying to find a position where the odds are too long or too short and are likely to change before the conclusion of the event. This will allow you to sell on your position at a profit at some point before the end of the market.
A sports trading example
A successful sports trade could involve a punter betting £10 at 8-1 odds that Conor McGregor will defeat Floyd Mayweather and then selling when the price moves into 5-1 after one round of boxing. Alternatively, someone could profit by laying Floyd Mayweather at 1-3 and then selling at evens after one round.
Sports trading in play
The duration of a sporting event offers plenty of opportunities to make profits. The relative performance of teams, horses or sportspeople against prior expectations will cause odds to shift rapidly in real time and allow gamblers to sell on their positions at a profit. Trading software like Geeks Toy, BetAngel or Gruss is highly advisable due to the speed advantage that they offer over betting via an exchange’s website.
Best events for sports trading
You are always more likely to profit if you understand the sport than if you do not. More popular sports will have greater liquidity, which makes it easier to exit your position. However, more popular sports are also more likely to have accurate odds, which limits the opportunities to make profits.
The best sports trading strategies for making money
Alarm bells should be ringing if you’ve read somewhere that sports trading can make you money instantly. Sports trading strategies take decades to get right, and when you finally do you’ll probably be banned from the major bookies who simply won’t want to take your bets. There is plenty of information on sports trading around then web that can increase your chances of being right. Statistical analysis platform like Stratabet, however, can point you in the right direction of potentially profitable sports trading trades.
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