Best Betting Sites UK / The latest sports news with / Basics: An Introduction To Betting Exchanges Basics: An Introduction To Betting Exchanges Basics is a series covering the basic elements of betting. In today's piece, we'll be focusing on a topic that even seasoned bettors can find confusing: betting exchanges.

Upon venturing onto an exchange, you're immediately presented with a dazzling array of different numbers and colours, and everything seems to change with the blink of an eye. What's more, if you do decide to stick around, you'll find yourself immersed in a betting experience that is quite unlike anything else. Curious to pull the curtain back and have all of your exchange-related questions answered once and for all? Then read on...

What is a betting exchange?

A betting exchange is a platform that allows bettors to place wagers on various events, ranging from sports betting to politics betting.

What is the difference between a betting exchange and a bookmaker?

There are a few differences to consider, but we'll focus first on the most significant difference:

  • Betting at a bookmaker means that you are betting against the bookmaker.
  • Betting at an exchange means you are betting against another bettor. 

So, for example, if you place a bet at 888sport, then there are two parties involved in that bet: you the bettor, and 888sport the operator. However, with an exchange bet, there are three parties: you, the bettor; the exchange; and a third party - another bettor who agrees to take your bet because they believe the opposite outcome to your bet will take place.

At this point, it's crucial to introduce the concept of backing and laying. We have a whole post about this at Basics: Back and Lay Betting which we'd suggest you read if you're considering using an exchange, but here's a basic summation:

  • Back betting is a bet to say you believe an outcome will happen (e.g. if you place a back bet on Manchester City, you're betting that Manchester City will win)
  • Lay betting is a bet to say you believe an outcome won't happen (e.g. if you place a lay bet on Manchester City, you're betting that Manchester City will lose or draw).

So when you place a bet on an exchange, there needs to be another bettor who is willing to take the opposite bet. So if you want to back a certain horse in a race, there has to be another bettor who is willing to lay that horse. If there is a bettor willing to take your bet, then your bet will "match". If there isn't, then your bet won't match, and will (in most cases) be cancelled when the event starts. The successful laying of racehorses that are favourites is among the best horse betting strategies available to you, if you know lots about the sport.

Other differences include:

    • You will pay commission on winning bets at an exchange. The amount of commission varies; some exchanges only charge 1-2% commission, others charge as much as 5%.
    • Exchanges do not offer Best Odds Guaranteed on horse racing. While ubiquitous at bookmakers, BOG is impossible on an exchange platform.
    • Exchanges exclusively use decimal odds, whereas most bookmakers allow users to choose between fractional, decimal, and American odds as suits their preferences.

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What is liquidity at a betting exchange?

Beneath the odds on an exchange is a figure that indicates liability, which displays in GBP. You will see multiple different odds in a row, all with different liquidity levels. For example, let's take the red-box row from an example horse race:

Betfair odds

The blue and pink numbers indicate the current most popular odds for backing (blue) and laying (pink) a particular horse: 15.5 to back, 17 to lay. Beneath, you can see the liquidity; £22 for backing, and £16 for laying. The liquidity tells you how much is available to be matched at those particular odds. So:

  • If you were to submit a lay bet with a stake of £10 on this horse, it would almost certainly match - because there is £16 of liability available. However...
  • If you were to submit a £30 back bet, then it probably wouldn't fully match, because there is only £22 liability available.
  • Instead, it would partially match: £22 would match, but the rest of your stake (£8) would be unmatched.

What can you do if a betting exchange bet doesn't match / partially matches?

Option one is to wait it out. Just because there wasn't enough liability at the time of betting (i.e. there wasn't another bettor willing to match your bet at your chosen odds) doesn't mean there won't be in the future; odds fluctuate, so your bet may match later on. Just be cautious to keep checking back if you have an unmatched or partially unmatched bet; if the event begins before a match is found, the bet will be cancelled - though with partially matched bets, the rest of your stake will stand.

Rather than wait, you can choose to cancel the unmatched bet yourself and resubmit at the updated odds.

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What betting exchanges are available?

There are several betting exchanges available to users in the UK, including - but not limited to - the following:

  • Betfair - Perhaps the best known betting exchange, Betfair has a standard commission of 5% and offers a wide range of markets, most of which offer excellent liquidity. To find out more about the brand, consider reading our in-depth Betfair review.
  • Smarkets - A smaller exchange with lower liquidity, but a lower commission structure to compensate.
  • Matchbook - A brand that is not particularly popular, and which has a rather cluttered design, Matchbook is nevertheless an option. Its low rates of commission on horse racing are particularly noteworthy.
  • Betdaq - An excellent brand with a strong reputation and decent offers, as covered in our Betdaq sign up offer review.
  • Ladbrokes Exchange - A little-known part of the overall Ladbrokes offering, the Ladbrokes exchange functions well but suffers from lack of brand awareness - liquidity is generally poor, even for major events.

What are the major advantages of using a betting exchange?

  • Betting exchange odds are considered to be closer to the 'true' probability of the outcome of an event, as exchanges earn their money from commission, rather than an overround.
  • Betting exchanges are less likely to limit bettors, as the exchange is just facilitating bets between individuals.
  • You can place lay bets at a betting exchange, which is not possible at a standard bookmaker.

What are the disadvantages of using a betting exchange?

  • By far the biggest disadvantage is the relative lack of promotions. While exchanges can and do offer promotions, these are far less common, and - as we mentioned above - you won't receive Best Odds Guaranteed on any horse races you bet on.
  • Unmatched and partially matched bets can be worrying for some users, especially when compared to placing bets at a bookmaker (where bets are guaranteed to be accepted).

Should you try a betting exchange?

If you wish to place lay bets, bet at accurate odds, or are just looking for a change in your overall betting experience, then exchanges are absolutely worth considering, even for election betting. However, if you're looking for regular promos, then you might want to consider betting with both a standard bookmaker and an exchange, so you receive the best of both worlds.

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💯 Which is the best betting exchange?

There are a number of betting exchanges to choose from in the UK, but which deserves the title of "the best" is subjective. You can learn more about the most common exchanges at; start with the Betdaq review for an in-depth insight into how these exchanges function.

❓ What is an exchange bet on Betfair?

As one of the largest betting operators in the world, Betfair is a popular choice for users in the UK. The brand offers a variety of betting options, including exchange bets, to bettors; to find out more about these and how they work, this Betfair review is a great choice.

🥇Is Smarkets better than Betfair?

Smarkets and Betfair are two of the best-known exchanges in the UK, both of which offer a variety of different options to users. To help you decide which is the best for you, has put together a full Betfair operator review, as well as details on Betfair bonuses, so you can learn more about the brand and how it compares to its competitors.

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