WHAT IS LAY BETTING?
Lay betting is a form of betting offered by a betting exchange whereby the bettor can back an outcome to lose. A lay bet will be successful if the selected outcome does not win the event. For example, the favourite for the race might be $3. If you were to ‘lay’ the favourite at $3 to win $50, you would be risking pay out $100 if the horse wins.
A betting exchange is a trading platform whereby bettors can exchange bets. Bettor A thinks that Team A will win, Bettor B does NOT think that Team A will win. The two bettors trade at a price agreeable to both. A betting exchange is very similar in operation to a stock exchange.
LAY BETTING WITH BETFAIR
Lay betting is available with all betting exchanges. Betfair is the world’s largest betting exchange and therefore has more liquid markets and provides greater availability of lay betting opportunities.
LAY BETTING EXPLAINED: HORSE RACING EXAMPLE
The selected bet is to lay Black Caviar to win the race meaning that we believe she will not win the race. The cost of putting on the bet per $1 is 12 cents. If the lay bet is successful and Black Caviar loses, the bet will return $1. If the lay bet is not successful and Black Caviar wins the race, the bettor will lose 12 cents.