Betting Exchange
Initial exchange operations are focused on horseracing, though it won't be lost on US punters that exchanges cover the full range of sportsbetting options.
Up to now Betfair have been running a betting operation using 4NJBets - a sportsbetting site who's Customers have got first try at the new exchange in a closed beta trial. Betfair also runs an online casino in New Jersey in conjunction with Atlantic City’s Golden Nugget casino.
Although initial results have reportedly been strong, it may take US punters some time to catch on to the big value that can be obtained. To help, Betfair are setting up an exchange simulator to help punters learn about the offer.
The full list of tracks which have made agreements to offer Exchange betting include Monmouth Park, Woodbine, and the tracks running live in Louisiana and West Virginia. In Canada, Woodbine racegoers can also use the service.
One element that might disturb prospective Customers is the 12% commission which will be charged on the win that comes out of any positive return exchange bet. In the UK, this figure is significantly lower, though we need to recognise that the liquidity in the US market may initially be low. Betfair need to cover their costs.
Liquidity In The Exchange Markets? What's That?
A betting exchange allows members to bet against each other rather than a bookmaker. Customers can offer odds to, or request odds from, fellow bettors. Check out our guide to the Betfair Exchange. What is a Betting Exchange? Betting exchanges give you the chance to bet against other customers rather than the house. You can choose to play the role of punter and “back” selections as you would do.
Clearly the understanding of how exchanges work needs to be built up in the heads of US bettors. Unfortunately this presents somewhat of a chicken and egg situation. To be successful an exchange needs to have plenty of cash being wagered - plenty in the pools to build up the chances of higher odds being available.
If there are not enough takers of the odds on offer (the exchanges Customers), then the layers will be prevented from offering higher odds. Everyone's out to make a profit, right? This is what's known as liquidity - essentially the volumes of money that make the betting markets viable.
Betfair obviously have a task on their hands to build up solidly and hopefully quickly - get as many US punters on to the Exchange as they can and show everyone the value.
So Really - What Value Do Betting Exchanges Give?
All of this talk about extra betting value for US sportsbetting fans is great of course, but it's worth knowing exactly how betting exchanges deliver that value. It's a big subject, and one which is already covered in many online articles so let's take a look at a few of the best:
The most obvious place to start is on the Betfair US exchange site itself, where you'll find plenty of info that'll help you get started.
Another option is to visit Wikipedia, the online encyclopedia which covers pretty much everything. The Wikipedia betting exchange article offers a great introduction.
Next up is a short BBC article on exchange betting which gives a clear description of how it all works. It's nearly ten years old but still worth a look.
Lastly this lengthy write up on betting exchanges at BettingMarket.com will take you deeper into the intricacies of the subject, explaining in specific terms how exchanges work and more importantly, how they deliver great value to betting fans.
For some more visual explanations there are dozens of useful betting exchange videos on Youtube channels.
These below specifically give a good - although basic - visual introduction. The first is Betfair's first promotional video for the new US exchange, the second comes from BetAngel and gives an introduction to exchange betting in general.
In a world where football is getting more and more exposure to the world through channels such as television deals and streaming services it’s only natural that the betting markets follow. That doesn’t mean all the money is flowing into the traditional bookies pockets though with exchanges seeing considerable growth. Here we look at the top 5 betting exchanges.
1. Smarkets
Commission: 2% Liquidity: High PunditFeed Rating: 5/5
When it comes to betting exchanges there is one that stands clear of the competition; that’s Smarkets. The big boys of the exchange world can be hard to separate when looking at factors such as the depth of sports and markets available because they all offer more than you’ll ever likely need. Liquidity i.e. the coverage of money in the platform is a similar story for the top end exchanges with only the most obscure bets not necessarily matched in a reasonable time frame. Why then do Smarkets top our list?
Well, they’re simply better than the competition. Their team seem to acknowledge that market penetration can’t really extend any further than it has to change the experience for individual punters so they’ve focussed energy on providing customers value and an excellent service. For starters, their 2% commission is as generous as we’ve seen (you can get 1% but it relies on huge stakes to be placed) and they’ve been offering it at that level for years. You’ll find others with a 2% commission but they’ve generally had their hand forced.
On top of that, their website and mobile apps are super easy to use. They look good, they’re simple to move around and the Smarkets app side even allows users to vary the colour theme. It’s a small detail but shows how much they think about their end user, which is a rarity in this niche. Finally, you’ve got a slick engine behind the scenes that provides useful graphics and manages price fluctuations for you when placing bets in extremely fluid markets such as in-play events.
Bonus & Offers detailsT&C:Once the bonus is credited to your account, losses will be refunded up to the bonus amount. You must deposit at least the qualifying deposit of £20 (or currency equivalent) in a single amount with your first deposit to be eligible for the rebate.
2. Betdaq
Commission: 2% Liquidity: Medium/High PunditFeed Rating: 4/5
Betdaq is far from a newcomer to the world of betting exchanges with 20 years of trading under their belts. It’s no surprise that they’ve built up a reasonable customer base over that time with their website easy to navigate and also mobile friendly; their app is decent too. Like most exchanges, they offer all the major betting markets and have plenty of liquidity within them, which enables punters to wager as they so wish.
Unfortunately, as the company strive to offer markets on less mainstream sports and events that flexibility can be reduced. This occasionally makes finding matches for your bets more difficult. Their in-play betting is very strong although football is a market where they need to improve that aspect; live streams and improved statistics would be a solid step but it’s not the end of the world with other resources available to delve into online. It shouldn’t be seen as a deal breaker.
Despite having a couple of areas for improvement, Betdaq is still one of the better exchanges out there and is worth considering – particularly as a secondary option. Standard commission is 2% with the occasional offer running to give 0% for limited periods of time. The company falls under the Ladbrokes Coral group as of a 2017 takeover and as such you have plenty of protection whilst depositing and withdrawing funds is an absolute doddle.
3. Betfair
Commission: 5% Liquidity: High PunditFeed Rating: 3.5/5
If anyone comes close to matching Smarkets in a pure gambling respect then it is Betfair. The company, who have been going for 21 years, are arguably the biggest name in exchange betting so it’s little surprise that they have plenty of users backing and laying bets at all hours of the day. We’re not suggesting you blindly follow the crowd but the fact Betfair, like Smarkets, have strong loyalty from their respective customer bases means you’ll rarely find events where you can’t pair your bets off – that’s critical to the success of a betting exchange.
The platform is well marketed, comes with an associated sportsbook and you can get your bets on with your eyes closed such is the way the website is structured. Betfair exchange, supported by its traditional betting site, pushes plenty of offers your way. These can be an extra boost with betting strategies like matched betting but you do need to factor in a 5% commission to ensure you’re satisfied with the overall levels on offer; if you’re keen to tap into the live betting markets then it’s possible you’ll see past a few percent because Betfair underpin their in-play bets with better streams than the other exchanges.
If, however, the 5% commission is putting you off giving them a go then this is something that can be reduced to 2%, however, in order to get this deal you do have to forfeit special offers – namely the best odds guaranteed on their sportsbook. The other thing to consider is the customer service angle, which is an area Betfair could look to improve particularly with Smarkets being excellent in this area.
4. Matchbook
Commission: 2% Liquidity: Medium PunditFeed Rating: 3/5
In straight up betting exchange terms, Matchbook can consider themselves hard done by to sit further down on our list. Unfortunately, we’re a football site and the dominant markets on Matchbook are the American sports such as NFL, NBA and MLB. That doesn’t mean it is redundant to the beautiful game though; far from it in fact.
For starters their commission is just 2% making it competitive with the cheapest exchanges out there and their depth of markets is pretty impressive with bet matching rarely a problem on the bigger sporting events. When it comes to the user experience, Matchbook stacks up pretty well too. The website is straightforward to interpret even for a new user and their mobile apps follow a similar pattern; they’re not revolutionary but won’t cause any problems either.
Like pretty much all online bookmakers, whether they’re traditional bookies or exchanges, Matchbook offer a sign up bonus and will allow you to deposit or withdraw through a plethora of methods. It’s worth noting their direct to bank withdrawals have a pretty hefty minimum at £500 but it doesn’t seem to bother their customers too much with a strong rating on trust pilot.
Betting Exchange Strategies
5. Ladbrokes
Commission: 5% Liquidity: Medium/High PunditFeed Rating: 3/5
We’ve already touched on Betdaq falling under the Ladbrokes Coral umbrella. Here we look at the Ladbrokes side of things, which comes with the huge perk of having the name of a high street name ‘on the tin’. The two platforms – Betdaq and Ladbrokes – are actually linked so regardless of where bets are wagered the funds go to the same place. This aids the liquidity for both.
Betting Exchange Trading
If you’ve read our recommended betting platforms for 2021 then you’ll know our thoughts on the Ladbrokes website being pretty smooth and the exchange side is much the same. The venture into exchange betting is a fairly new one in comparison to the other sites listed but it does mean their mobile app has been purpose built as opposed to having been developed as a secondary thought as technology has developed. The app is very good.
Betting Exchange
Despite all the positive noises we’re making about the Ladbrokes exchange, there are a couple of reasons it ranks fifth compared to its partner, Betdaq, who we rank second. Firstly, although the two platforms are very similar, Betdaq provides a better all-round experience with a major difference the fact plug-in tools can be linked to improve market insight. This isn’t unique to Betdaq but is a notable absence on the Ladbrokes platform. The last big factor to consider is the commission. You can achieve 2% commission on Ladbrokes but it’s all relative to the amount of money you risk. With smaller bets, you’ll pay a higher rate of 5%.