There’s always an element of risk when you gamble, but there are strategies you can employ to minimise this. One of the best is back-to-lay: taking both sides of the bet to back and lay the same selection following a price movement either to lock in a profit or minimise your potential loss.
With a back-to-lay strategy you’re not necessarily looking for a selection that you think will go on to win.
You’re looking for a price that’s bigger than you think it should be.
When the price contracts you can take advantage of the exchange and make money.
Back-to-lay is at the heart of many successful exchange bettors’ strategies. The key to this idea is backing when you think the market is undervaluing a team or player’s chances and laying when you think the market has either overcorrected or come back to its correct price.
Back-to-lay in practice
For example, you might have noticed a long-odds selection with a price that you think is too big, say Man City to win the FA Cup at 14.0 instead of 9.0. You put €100 on and the market eventually catches up with you and the price contracts to 9.0. With a traditional bookie you could only hope it goes on to win, but with an exchange your options are far less limited.
Instead of letting the bet ride, you can now lay Man City at odds of 9.0 and lock-in the same profit regardless of whether they win or lose. To find out how much you should lay your selection by to make the same amount of money whatever happens, just divide the return of the initial bet by the price you’re going to lay at.
In this case that would be €1,400/9.0, which equals €155.55. That would guarantee you a profit of €55.
Protect your outright bets
The Premier League has provided a great example of a back-to-lay bet this season. Even if you missed the 5,000/1 available on Leicester winning the league at the start of the season, a lot of people took advantage of the 150/1 available at the end of November. At the time the Foxes were flying and there seemed to be a reluctance to accept this year was unlike any previous in the Premier League.
There was no guarantee Leicester would hold out though, and after Leicester beat a tepid Man City at The Etihad in February, a great opportunity to lay was presented to the Leicester backers. If you laid Leicester at odds of 3.0 you could have locked in a €503 profit (€1,510/3.0) and watched the rest of the season as a happy neutral.
When outliers overperform, back-to-lay betting opportunities present themselves. Leicester City’s 2015/2016 season is a prime example.
More complex back-to-lay strategies involve looking at a market and backing a selection with the intention of laying it in-play. On the exchange you can back and lay the same selection at different prices. Say that you back a horse for €100 at 10.0 before the race in the knowledge that it’s a front-runner and likely to hit a much shorter price in-running, even if it doesn’t go on to win. You request a lay price of 5.0 before the race with a stake of €200.
As you expected, your horse hits the price in-running and your lay bet is accepted. The horse fades and doesn’t win, but you’ve guaranteed yourself €100 profit. The risk here is that your price isn’t accepted and your back bet loses.
Remember, with a back-to-lay strategy you’re not necessarily looking for a selection that you think will go on to win. You’re looking for a price that’s bigger than you think it should be. When the price contracts you can take advantage of the exchange and make money. Remember, if a price isn’t available on the exchange you can always request it and see if it gets matched.
Get out when the going is good
If you’re employing a back-to-lay strategy, you should always have an exit point and stick to it. If you have a price in mind, you should lay your selection when it hits this price. You should also have a back-up plan if things don’t go the way you thought they would. Laying a bet to minimise your total loss is as important as locking in a profit.
The downside of a back-to-lay strategy is when your long odds selection goes on to win, but that’s a risk you have to weigh up. Of course, you don’t have to lock-in the same profit whatever happens. If you fancy your selection at a high price, you could opt to lock-in a certain amount of profit, or even just cover your initial stake and let the rest of it ride.