What is a betting exchange A betting exchange is a platform for bettors to trade on the outcome of various sports. The major difference between a betting exchange and a bookmaker is that an exchange
What is a betting exchange
A betting exchange is a platform for bettors to trade on the outcome of various sports. The major difference between a betting exchange and a bookmaker is that an exchange allows bettors to bet against each other rather than a bookmaker – users can act as the bookmaker by setting the odds and betting against (laying) a particular outcome or they can act as the customer by backing the odds set by the other users. Odds are determined by the users, i.e. the market, rather than the bookmaker.
Unlike a bookmaker, exchanges charge a commission, usually up to 5% of the winnings.
The biggest advantages of exchanges compared to bookmakers are:
- Exchanges tend to offer higher odds than bookmakers
- You have the freedom to trade in and out of the market at any time before and during play – this allows opportunities for locking in profits or cutting losses
The biggest disadvantage is that exchanges tend to have less liquidity in the market than bookmakers, meaning that it isn’t always possible to back or lay a bet if there is not enough money to accept that bet.
The biggest and most popular exchanges are Betfair and Smarkets.