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The Betfair Buster

The Comprehensive Betfair Masters Guide.


All Rights Reserved, 2006. © The Trading Formula 2006


Table of Contents

The Betting Exchanges Page 03

The Betting Odds Explained Page 05

European Method Page 06

British Method Page 06

Betfair Busted Page 07

The Markets Page 09

Configuring Betfair Page 10

Backing Page 11

Laying Page 12

Placing a Bet Page 14

Trading Page 15

Liquidity Page 17

Weight of the Money Page 19

Unmatched Money & The Markets Page 20


The Betting Exchanges

The Betting Exchanges are at best described as a virtual

online market place which enable punters from all around the
globe to gather and bet money against one another on any
sporting event such as football, tennis, horse racing and
hundreds more. When they arrived, they turned the betting
w orld on its h ead … in an in stan t.

The betting exchanges have recently evolved. One of the most

unique characteristics about the exchanges, is that they allow
anybody to b et “in p lay”. T h is refers to b ettin g w h ile an event
is going on which means the odds change accordingly to what
is happening to the event in play.

The betting exchanges differ in a few ways. The first way being
that they allow you to place lay bets, which puts you in
position as the bookmaker (This will be covered shortly). The
second difference is that the betting exchanges themselves do
not lose money on any bets. They take a commission on
anything that is won – very profitable business.

This means that the exchanges cannot lose and in turn means
they are very profitable. In light of this – they will never lose
out which means that the betting exchanges will be around for
a very long time.

All of the various betting exchanges provide bets in two forms.

Back bets and Lay bets. Backing allows a punter to bet on a
selection to win while laying allows a punter to bet on a
selection to lose (to not win… ).

The next page gives you a list of the various available


Below are just a few of the most popular betting exchanges

around on the internet. In the next section we will discuss
Betfair in depth due to the sheer popularity of that specific
exchange as well as it being the primary base for the Trading
Formula manual.

The Betting Odds Explained

The odds – A lso kn ow n as “p rices” are b asically th e essen ce of

betting. They decide on our profits, losses and theoretical
chances of winning or losing a bet.

A favourite has the shortest priced odds, in other words – the

lowest odds of all the other competitors in a race for example.
The outsider is the selection with the highest odds. There are
two widely known representation of the odds.

The European method and the British method.

The European method displays the odds in decimal format.

The Betting exchanges all use decimals to display their odds.
The British method displays the odds as fractions. Something
everyone should take note of, is that the odds on the betting
exchanges tend to trade at higher prices. This is known as
“O verrou n d ”, w h ich is th e extra m on ey stan d ard b ookm akers

T h is “h igh er” p rice is n ot alw ays a tru e reflection due to the

fact that Betfair takes a 5% commission on everything that is
won. Another pointer about the odds on the betting
exchanges, is that they tend fluctuate constantly. For example
a selection priced at 3.0 can suddenly move to 2.98 and then
up to 3.05 within a matter of seconds. It all depends on the
money coming in on either back or lay side.

On the next page, I will run through the main differences

between the two methods of displaying odds, including a few

European Method - (decimals)

Decimal odds, which are used on all the betting exchanges

such as Betfair, are displayed in decimal format. Odds such as
3.20, 1.22 and 1.65 are displayed on the various exchanges.
The odds on the exchanges range from 1.01 to 1000. 1.01
being the lowest possible odds to take and 1000 being the
highest available price. When you have odds of 1.01 you
should heavily expect to win and virtually never lose. Odds or
1000 – you have no chance.

British Method - (fractions)

The British method, which is used by most standard

bookmakers such as bet365, Coral and so on, display their
odds as fractions, in the form of 4/1, 7/4 and 9/4. When you
get od d s of 1/1, th is is said to b e “even s” which is the
equivalent of 2.0 in decimal form. Anything less that 1/1, such
as 1/3. These odds are not too important seeing we wont be
using them when applying the system because the system is
B etfair, or in oth er w ord s, “B ettin g exch an ge orien tated ”.

To Convert from fractions to decimal odds you do the


Take the fraction such as 7/4.

Take the top and divide by the bottom.

7 divided by 4 = 1.75

Now take your answer and add 1.0

1.75 + 1.0 = 2.75


Betfair Busted

B etfair is th e “b ig gu n ” when it comes to the betting

exchanges. It has by the most registered users compared to
the rest of the exchanges and there are tens of thousands of
people who place bets in the various available markets on a
24/7 basis. All Betfair does is supply the user interface and
keep track of where every punters money is going. They take a
5% commission of everything you win. So If you were to win
£10 (profit) off a bet, they would take 50p of your profit.
Commission is only deducted on money won, not money lost.

If you were to point your browser to

you would see the following screen:

T ow ard s th e top of th e screen you w ill see a “Join N ow ” lin k.

Click this link. It will then bring up a box where you have to
fill in your various details in order to register an account.

While entering your details, you w ill also see a “refer an d

earn ” b ox. A ll yo u h ave to d o is typ e in th e cod e 6QK7GREQF
which will give you a free £20 once you have reached 100
Betfair points. This is roughly the equivalent of staking £100.
Once you have registered on the site, have a look around and
get used to the general layout. On the left hand side of the
screen, you will notice the various sporting events, listed in
alphabetical order.

The Markets

When you open

This screen can be found on the

left hand side of the Betfair
introduction / homepage
screen. If you have still not
registered, please do so ASAP at and use the
sign up code.

The purpose of the Trade

Formula Manual is related to
Horse racing. You will notice I
have highlighted the two horse
racing markets in a red block on
the screenshot to the left of this

We will now begin discussing

the more important factors
relating to Betfair such as
backing, laying and trading.
Those three methods make up
the foundation of the Trading
Formula manual.
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Configuring Betfair

This configuration setup will allow you to know how much

profit you stand to make and how much money you stand to
lose. It is very simple to configure.

In every single Betfair market, there is a refresh button. Just

ab ove th e b u tton is th e “o p tion s” m en u . C lick th is m en u .

Tick all the available boxes in order to make you profits /

losses display. This will be useful later on.
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Backing is a fairly easy concept to understand. It is the same

method as placing a bet with a standard bookmaker, such as
Bet 365 and so on.

Backing means that you are betting on a selection to win. The

back odds can be seen in the purple/bluish

Take the above screenshot for example, say we wanted to back

th e favou rite, “B en n y T h e B u s” in th is race. T h e od d s as you
can see, are at 1.83. If we were to put £100 on the favourite
and it were to end up winning the race, we would make a total
of £183,00. This includes a profit of £83,00 minus the £100
stake money.

F or an oth er exam p le, say w e p laced £ 10 on “M ister Jin gles” at

8.2. If Mister Jingles were to go on and win the race, we
would win £82.00 minus our £10 stake which is a profit of
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Laying works in a completely different manner to backing. It

virtually allows you to act as the bookmaker. This is not as
much of a difficult concept than you may think, seeing many
people fail to grasp lay betting.

L ay b ettin g is b ettin g on a sp ecific even t “N ot” to h ap p en .

Take the screenshot as an example below

In this screenshot, th e favou rite “Jost V an D yke” h as od d s of

2.72 to LAY (note the highlighted block). Please note that the
lay column is situated on the right and is highlighted in pink
for anyone who is unsure.
If we were to place a £10 LAY bet on Jost Van Dyke, we are
saying that the horse will not win this race. However, placing
£10 pounds has an advantage and disadvantage.
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Advantage: You will win £10 back instantly

Disadvantage: You can loose 2.72 x £10 (minus stake money)

This is known as your liability. It is the amount of money you

may lose if the selection ends up winning a race.

To calculate liability, take the odds. In this case, they are 2.7
and multiply them by your stake, which is £10. This gives you
a total of £27. You must then subtract your £10 stake, which
would give you a total of £17.

This £17 is the amount you would be liable for, if Jost Van
Dyke were to WIN this race. If it were to not win, you would
make the amount that you staked. In this case it would have
been another £10. It is risky, but can be a very profitable
betting method if you learn to use it correctly and at the right
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Placing a Bet

Let us take the following market as the example here.

Say for example, we want to back “B en n y th e B u s”. To place
our bet, click on the purple back bet option. Y ou ‟ll n otice th e
block indents it a bit on the odds of 1.81.

You will then see a betting box popup on the right hand side
of your screen. See the below screenshot.

You will notice the box is arranged in order of selection name,

then the odds and then the stake box.

N ext to th e od d s you ‟ll n otice an u p an d d ow n arrow . It allows

you to change the odds there if you want to request a higher
back odds price.

O n ce you en ter you r stake in th e stake b ox, click th e “su b m it”

button which is located at the bottom right of the window.
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Trading is one of the core features presented to you in the

actual Trading Formula guide, which means I will give an
overview of it here, but primarily in the actual guide itself.

The backbone of trading is placing a back and lay bet on the

same selection. The only difference is that the odds for the
BACK bet must be higher for the odds of the LAY back.

To give you an example using calculations:

Lets say there is a horse race.
The horse is priced at 2.90 to back and 2.92 to lay.

Say we place a £10 0 b ack b et at 2 .9 0 … .

£100 x 2.90 = £290 – the stake which is a profit of £190. Lets
say the odds for the horse now drop down to 2.30. We then
place a £100 lay bet at odds of 2.30.

£100 x 2.30 = £230 – the stake which is a liability of £130

Profit – Liability = Trade
£190 - £130 = £60

This will mean if the selection were to win the race we would
make £60. If the selection were to lose the race we would
break even, which is how trading actually works.
Take the following screenshot as an example. (note Betfair
commission is deducted)
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Please note that the first screen shot came just after the start
of a race. The second screenshot was during the race. This will
explain why the odds are so different and the difference
between the back/lay amounts in column two are so large.

Say we placed a £10 lay bet on Gaelic Flight at odds of 2.8, as

you can see, if the horse wins the race we will be payout out
£18 as our liability. If it does not win, we will be winning £10.
The next screenshot shows how the odds have changed over a
few seconds. Say we were to now place a back bet of £10 at
odds of 4.4. This profit would be £34, if the horse were to win

Now, seeing these two bets have both taken place on the same
horse, the outcome will be as follows. 1 lay bet of £10 at odds
of 2.8, giving us a liability of £18 and 1 back bet of £10 at odds
of 4.4, giving us a potential profit of £32.30. This would be a
trade (had it been on the same horse). We would then be left
with Profit (£32.30) – Liability (£18) = trade £32.30 - £18 =
£14.30 (as seen below)

This means if Gaelic Flight wins, you make £14.30 profit. It he

loses, you break even. This is a free bet! In other words, an
actual trade!
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Market liquidity refers to how much money is in a market and

is going into a market at a specific time. Some markets are of
high liquidity while others are low. It basically depends on the
popularity of an event.

A British horse race has a massively high liquidity. Close to

about 700,000 pounds is traded on it before the off. Another
event with a very high liquidity is an English premier league
football match.

Low liquidity events such as the greyhound races and

American horse races, only have a few thousand pounds
traded on them.

The difference between the two liquidity markets is that in a

high liquidity market, price changes do not happen at a rapid
pace, compared to the low liquidity markets where price
changes are very common and can jump from 3.2 to 4.5
within a matter of seconds.
A good place to spot whether or not a market is of high
liquidity is the amount of „matched money‟on the market.
This figure appears just below the refresh button on that
specific Betfair market.
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Weight of the Money

This section also teaches you a fundamental concept about

how the prices on the exchanges rise and fall. This section will
also help you when it comes to trading on the horse races
using the Trading Formula system. The greyhound trader,
another bonus included in this manual, will basically use this
concept added with the greyhound form guide as you will
soon see.

Prices on Betfair are influenced by the amount of people

backing and laying a selection.

More money in the back column means the price will RISE.
More money in the lay column means the price will FALL.

This is determined by the amounts of money coming in on

either side of the back and lay columns, basically known as
liquidity, as already discussed.

If there is more money in the back column, the price is going

to rise once the money has been matched. If there is more
money in the lay column, the price is going to fall.

Take this screenshot below as an example

Applying the concepts highlighted in bold above, you will

notice that there is by far more money in the lay column that
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the back column which means the price of the selection is

going to fall.
A few seconds later the screenshot will look like this:

You will notice that the weight of the money concept has
cause the price to fall because punters are all scrambling over
one another trying to get in their best bets forcing the price

In other words it means far more people are trying to BACK

this horse than lay it which causes no one to want to match
the odds by laying. This means punters who are backing the
horse are forced to place lower odd bets in the hope they get
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Unmatched Money & How Exchanges Work

This is a concept that not many people understand. Exactly

“how” the exchanges work and the unmatched money figures.
Take the below example screenshot

Say you wanted to place a lay bet at odds of 2.64 for £10.
There is £23 waiting to be matched at odds of 2.64.
This means that someone is trying to back the horse of odds at
2.64 and is waiting for someone to come match it by laying it.

The same goes for the back odds of 2.62. There is £46 waiting
to be matched. If you were to place a back bet of 2.62 for £10,
you are just matching somebody‟s lay bet of 2.62.

If you tried to place a BACK bet of £10 at odds of 2.64, your

money would appear in the LAY column of 2.64 and your £10
would be added to that £23 which is still waiting to be

If you placed a BACK bet of say 2.68, for £100, your money
would be added to the lay column side under 2.68 and the
amount of money underneath the odds would then read
£1221, unless some of it gets matched during the time of
placing the bet. This is unlikely due to the fact that it is 3rd in
the queue.