When placing a bet with a bookie, you’re betting on something to happen. For example, a bet on Arsenal to beat West Ham would win if Arsenal won the game. Similarly, a bet on Red Rum to win the Grand National would win if the horse crosses the finish line first.
Although, what if you didn’t fancy Arsenal beating West Ham? Perhaps one of the daily free football tips that you follow advised the bet or your thoughts are that Arsenal are very defensive and lack attacking options. Therefore, you may be confident that they won’t win the game but can see a draw playing out or West Ham winning.
Of course, you could place a bet on West Ham to win and also back the draw which would cover all outcomes other than Arsenal winning. Alternatively, you could place a ‘Double Chance’ bet which is essentially the same.
However, doing this with horse racing isn’t quite as easy as there may be over a dozen horses in the race and it’s impractical to be backing all of them just because you’re confident one won’t win.
That’s where LAY BETS come in.
Instead of betting on something to happen as you do with Back bets, with Lay bets, you can bet on something NOT to happen.
For example, if you thought Arsenal wouldn’t beat West Ham, you could simply LAY Arsenal and your bet would win if West Ham won or the match ended in a draw. Basically, any outcome other than Arsenal winning.
Similarly, if you were confident that Red Rum wasn’t going to win the Grand National, you could LAY the bet. Your bet would then win if any of the other horses in the race won.
Where To Place Lay Bets
One reason why placing lay bets isn’t as popular as placing back bets is that you can’t place them with standard bookmakers such as Bet365, Paddy Power or Sky Bet.
Instead, you must place lay bets on a betting exchange such as Betfair Exchange, Smarkets or Matchbook.
Betting exchanges differ from standard bookmakers in various ways.
Along with being able to place both back and lay bets on a betting exchange, another big difference is that you are not betting against a bookie. Instead, you are betting against other customers on the exchange.
Betting Exchange Liquidity
As you are betting against other customers, there must be enough money in the market for your bet to be paid out, before you place it. This is called liquidity and it applies to both back and lay bets on a betting exchange.
When placing your bet on a betting exchange, the liquidity will be displayed alongside the odds.
For example, the image above shows the Match Result market for the football match between Bolton and Aston Villa.
If you were to back Bolton to win (back bet) at odds of 8.4, the liquidity is £61 and this is the maximum amount you can bet at those odds at the current time. Should more bets be placed on the market by users, this will cause the liquidity to move up or down.
If you were to LAY Bolton, the maximum stake for your lay bet would be £28.
You can place bets above the liquidity amount and if you do, your bet will be matched with any available liquidity and the remainder of your stake will be unmatched and left open for other users to bet against.
Liability Of Lay Bets
When placing lay bets, you are essentially acting as the bookmaker and taking bets of other users who are betting against you.
For example, if you were to place a bet on Arsenal to beat West Ham with a bookmaker, the bookie pays out if Arsenal win and keeps your stake if the match ends in a draw or West Ham win.
From the bookies point of view, this is the same as placing a lay bet on Arsenal.
Therefore, if you were to lay Arsenal on a betting exchange, you are acting as the bookie. This means that if Arsenal win, you must have the funds available to pay out against your stake.
In short, the liability is the amount of money you must have in your account to cover your lay bet.
Just as a bookmaker would keep your stake if your bet with them lost, when placing a lay bet, your lay stake is the amount that you will win if your bet comes in.
If your stake is what you win, what do you lose if your lay bet doesn’t win?
Again, this is similar to a bookmaker paying a punter for a winning bet.
Let’s say that you placed a £20 lay bet on Bolton vs Aston Villa ending in a draw.
The odds on the screenshot above are 5.5, or 9/2 in fractional odds.
If your lay bet wins, you will make a £20 profit.
If it loses, you will pay out £90 as the bookmaker would if the punter won.
Conclusion
Although back bets will remain as the punters' most popular bet, lay bets can give you additional options when it comes to betting.
We strongly recommend getting to grips with betting exchanges before placing any bets on them. Especially if you are considering placing lay bets as it’s extremely important to understand liability so that you don’t lose more than you expect to.
Betfair Exchange is the world's biggest online betting exchange and the website has several guides to help beginners get started with using their platform. If you’re interested in learning more about placing lay bets and using betting exchanges for your bets in general, that’s a great place to start.
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