Spread Betting

Spread betting on sports is one of the most exciting ways to trade in play. Essentially, spread betting isn’t that different to other forms of sports betting, yet it seems to deliver far more of a thrill.

Perhaps it’s the fact that you ‘buy’ and ‘sell’ the market – a bit like being a commodities trader, or maybe it’s just the way that the ‘numbers’ moves during the event. Either way, it’s a lot of fun. You do, however, need to understand what spread betting is all about before you enter the marketplace because like all betting and trading, it carries some risk.

One of my favourite markets is the total points market, so we’ll use that as an example, but you can bet on numerous other markets across numerous sports.

Rugby Total Points

This is the market for a Super Rugby match between the Melbourne Rebels and the Auckland Blues. Most spread betting firms will display the markets like this or similar:

 

Rebel v Blues market view

 

You can see the ‘Total Points’ market and the ‘Sell / Buy’ heading highlighted in red. In this market you can sell the total points in the game for 51 and buy for 54. The number between the 51 and 54 is known as the spread (‘1 point spread’, ‘2 point spread’ etc.)

Here I want to ‘sell’ for a stake of £10. The bet slip should look similar to this:

 

sell totals market

 

Here I want to ‘buy’ for a stake of £10. The bet slip should look similar to this:

 

buy totals market

 

With traditional betting, you tend to know what your profit or loss will be at the start of the event because your returns are based on traditional fixed odds. One of the differences with spread betting is that your potential profit or loss are not always known until the match is over or you have traded out.

Scenario 1.

The match finishes with a score of 28-33, a total of 61 points.

If you had bought at 54 for £10 (‘£10 a point’) you would win £70. (The difference between the points total and the buy price – so  61 – 54 = 7. £10 x £7 = £70).

If you had sold at 51 for £10, you would lose £100. (The difference between the points total and the sell price – so  61 – 51 = 10. £10 x 10 = £100).

Scenario 2.

You decide to come out of the match in-play because on-field conditions are deteriorating due to a thunderstorm. The market has also moved in, in anticipation of fewer points and now stands at 30 – 33.

In order to trade out of your position, you need to do the opposite ‘action’ of your original trade. If you initially made a ‘buy’, then you now ‘sell’. If you initially made a ‘sell’, then you now ‘buy’.

If you had initially ‘sold’ at 51: You decide to take your profit right away. You sold at 51, so you now buy the market at 33. The difference is 18 (51 – 33). Your profit is £180. (£10 x18).

If you had initially ‘bought’ at 54: You think the total / spread might come in further and so decide to reduce your loss. You bought at 54, so you now sell the market at 30. The difference is 24. Your loss is £240. (£10 x 24).

Effectively, this is like the Cash Out facility available with online bookmakers or trading on the betting exchanges.

Maximum Liabilities

In some markets, like the Total Points market, you can work out your maximum liabilities and adjust your stakes if you want to. In the above example, Rebels v Blues, the worst possible scenario is a 0 – 0 scoreline and therefore a points total of 0. If you had bought the market at 54, you would lose £540. The difference between 0 and 54 = 54. (£10 x 54 = £540).

If you were uncomfortable with that kind of liability, however unlikely the scoreline, then you could reduce your stake from £10 to £5 for instance. Now your maximum loss would be £270. (54 x £5 = £270).

Some other markets work differently and it is not always easy to see what your liabilities might be. Make sure you totally understand your market.

Advantages of Spread Betting

Some of the advantages of spread betting are as follows:

  • Wide choice of markets pre-match and in-play.
  • Your knowledge of sport is rewarded.
  • No concerns regarding liquidity which can be a problem at times on the betting exchanges.
  • Low minimum stakes of ‘pennies’. Currently 10 or 20p ‘per point’.
  • High maximum stakes. Variable depending on the market and situation but up to £500 ‘per point’ not uncommon.

In a sense, spread betting is often about margins, more than just winning or losing. It is about how ‘well’ you win and how ‘badly’ you lose. Spread betting rewards your knowledge of the particular sport or event on which you are betting.

Other Sports and Markets

Football: Some spread betting firms offer 200 pre match markets and 150 in play markets on football. Supremacy, corners, total match goals, total goal minutes, shirt numbers, time of first goal, bookings, relegation index, match performance, group indices, and many more.

Horse Racing: Race position, winning distances,  jockey’s performance, starting price, match bets, race indices, favourites, and more.
 
Cricket: Player runs / wickets, session runs, team runs, next wicket, 50/100 ups, bowler markets, tournament index, and more.

Rugby: Supremacy, total points, team points, first match try, season points, team shirts, team tries, and more.

Tennis: Match supremacy, cross courts, total games played, index related bets, total aces / double faults, and more.

NFL: Win index, multi points, total points, total touchdowns, quarter points, touchdown minutes, outright index, supremacy and more.

Other sports include: Basketball, Darts, Boxing, Motor Racing, Specials / Entertainment, Golf and Politics.

You can find out about the top spread betting firms here

Good luck with your spread betting.

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