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Racing Stock Market System

Learn how to use the Betfair SP to Your Moneymaking Advantage

Http://www.RacingStockSystem.com Racing Stock Market System

Liability & Disclaimer The Author, Publisher and any other persons involved in the creation, distribution or selling of this information product may not be held liable for any profit, losses or damages incurred to property through the use of this publication. All external links provided are used for information purposes only and can not guarantee their accuracy on statistics, results within their provided content towards the functionality of this trading system. This digital product my not be sold, copied or distributed in any form or manner whatsoever. Failing to abide by this ruling may result in the use of solicitors. Any form of plagiarism with regards to the content of this guide is illegal in all respects with regards to the copyright acts and should be reported immediately. This guide is copyrighted to Webtrinx Systems C.C and anyone caught obtaining, selling or distributing this guide illegally will and can be held liable and shall be contacted by solicitors. Your download of this guide will have been tracked by our servers and any downloads coming from anyone not related to the buyer will be investigated.

Table of Contents

Foreword What Influences Markets The Bookmaker & The Mistake Using this Manual The Betfair SP Trader How to Implement the SP Trader Monitoring Starting Your Trade Trading Off (Hedging) Stakes and your Betting Bank Value Backing and Laying Introduction Backing Selections Laying Selections Staking & Betting Bank

Page 4 Page 6 Page 7 Page 8 Page 9 Page 12 Page 14 Page 16 Page 22 Page 24 Page 25 Page 26 Page 77 Page 28 Page 29

The Betfair Guide & The Basics

Page 30+

Foreword

Hello and welcome to one of the most unique betting system manuals you will ever purchase. The Racing Stock Market system aims to treat your horses that you will be betting on as short term investments and we will use various tools to place as well as back, lay and trade our bets, more specifically, the brand new Betfair Starting Price. Another concept that this manual aims to teach is the value in betting as well as something quite strange when it comes to people using form guides to bet with! What the Betfair SP gives you, is an alternative to the traditional high street bookmakers, but once again, youre placing SP bets against other punters. The market price is generally different compared to the normal Betfair price. There are a few noted problems with punters these days, mainly the usual ones you hear about such as greed and so on, but one of the biggest problems which nobody discusses, is the main concept of betting on value! Let me explain it to you with an example... If you have a horse at odds of Evens which is 3.00 and you were told that this horse has a 40% chance to win the race, would you bet on it? If you answered yes then there is something wrong with you, seeing that evens means it has a 50/50 chance, so of course you would not bet on a chance like that. This concept of value will be discussed later on. Another concept is this. Many people will bet on a horse which has just steamed in (where the price comes down). They will back this horse AFTER they see the price has dropped considerably because in their minds, this is now a bet where many people have put money on, so obviously it has a good chance of winning.

This concept is perfectly normal but you would not have gained the value from the bet. Lets put it in perspective. Say we have four horses over a day, that are between 4.0 and 3.5... Over the course of the day they steam (the odds decrease), because more are backing them to win, and when it comes to race time, the odds are between 3.0 and 2.8. Lets say you backed all four of these horses at 2.80. Lets also say we bet 100 on these four horses. Lets also say 2 of the 4 won, meaning we made 180 x 2 = 360. Subtract the 200 which we lost on the one losing horse, meaning we have a profit of 160 for the 4 bets. This is fair enough, but did we get the proper value? The answer is no. Had we backed at 4.0 or 3.5.... (lets go for 3.5), and we won two of our four bets, that makes 250 per winning horse, meaning 500 for the two winners. Subtract the 200 lost on the others and our profit is 300 for the two winners. See how the value we would have taken would have been virtually double what we would have made if we had only bet on the horse once the trend of the odds had been done only at the end? Its quite incredible to think how much extra money you could be making on your bets. This manual will teach you how to change this as well as the way you back and lay. A philosophy Ive been recently using is always back high, because it can only go down.... and always lay low, because it can only go up. This is another concept which I will help you implement into the Racing Stock Market System.

What Influences Markets

Many people have this fact incorrect. Most people think a bookmaker changing their odds will influence the odds on the betting exchange. The fact of the matter is that it is quite the opposite. Have you ever asked yourself the question why does a bookmaker exist? The answer is simple to make money. Now, as you probably already know, bookmakers strategically base their betting odds so that they will make a profit no matter what horse wins the race, based on what money is bet on what horse. Bookmakers will generally change their odds if there is a big difference on the betting exchanges where people are busy betting using arbitrage. For those of you who do not know what arbitrage, I can explain it like this. Basically at a standard bookmaker, say a horse is at odds of 5.0 and on Betfair the odds are 4.5. You have an arbitrage opportunity here. You would BACK at 5.0 with the normal bookie and lay at 4.5 on Betfair to guarantee yourself a profit. To sum it up, what you are basically doing it trading, over a bookmaker and a betting exchange, but dont worry, this manual is not about arbitrage, even though I wouldnt say you shouldnt use it when you apply the concepts in this manual. Back to the topic of discussion here again, I say that a Betting Exchange, such as Betfair, has the greater control over the market as well as market trends due to one simple reason. If a bookmaker realises that there is an arbitrage situation, soon they will be adjusting their odds to match that of the exchange. If they dont theyll get a ton of punter backing on them and laying on Betfair to guarantee themselves a profit. Therefore in order to stop this happening, the bookies are forced to adjust otherwise they run the risk of losing out. (Not much but still).

The Bookmaker & The Mistake They Make

This is another concept which you will then realise how the concept of value is understood if you havent already. The way that bookmakers make their profit is by compiling the odds over the runners (horses in a race), to make sure they make a profit no matter who wins the race. They are also protected by the overround. Overround can be described as the edge that the bookmaker will create and have over you in a betting market. If you were to place a bet on every single horse in a race, varying your amounts you bet in order to break even whoever wins, you will unfortunately never find this occurrence. You will always come out at a small loss due to the overround. Think of each horse having a % share of a market. The only difference is that the market is not worth 100%. Its generally around 98% or 99%. That extra missing 1% or 2% is where the bookmaker profits. Now youre probably thinking, what is the mistake the bookmaker makes. The answer is simple. They are only there to make money right? They position the odds on their horses in order to make a profit whoever wins right? Now more often than not, the bookmaker will overvalue a specific horse. They will do this without really realising it because what theyre more concerned with is making the guaranteed profit no matter who wins the race, so the smart punters will try and find out what horse has this extra value and start backing it. Once there are more and more backers, the bookmaker then realises that the money is coming in for this specific horse, so theyll adjust the prices accordingly.

Using this Manual

This manual combines trading, backing and laying into three separate parts. By that I mean, well teach you a trading method, a backing method, as well as a laying method. All based on the concept of value that we have discussed. Basically the Racing Stock Market system aims to teach you how to see your bets as short term investments, with the opportunity to trade them out and guarantee a profit before the race starts, or, just straight back and lay bets. You cannot lose money in the long run if you stick to the value concept we discussed earlier. The basis of the guide is to teach you how to spot these value bets early on so you can take full advantage of whats on offer. The thing about the big money punters and the professionals who make their daily living from betting, Betfair or the Exchanges in general, is that they are the ones who are taking these value bets. In the long run it gives them more profit, as I showed you earlier on in the manual how backing four horses at 2.8 was far less value than backing them at 3.5.

So basically what Ill do is divide the manual into three different sections. 1. The Betfair SP Trader Section 2. The Value Backing Method 3. The Value Laying Method

P.S For those of you unfamiliar with Betfair as well as backing, laying, trading and any of the other concepts, I advise you to go to the end of this manual where everything is explained.

The Betfair SP Trader

This is a unique method which I have been using myself for quite some time now. It brings in a good steady stream of daily income. Firstly let me explain something so everyone understand this from the beginning. When you back and lay at the Betfair SP, make note of the following. Make sure you have the following ticked under Betfair options once youre logged into your account.

This allows you to see pre-profit/loss as well as allowing you to see what the projected SP or the Display Near/Far odds are.. Projected SP is not the official SP, it is basically what Betfairs system calculates it should roughly be before the off, depending on how much money has come in and so on. What you should do here is click on the Display Near/Far odds Also one thing you need to know: When you BACK at SP, you are liable to lose the amount that you are betting, but for LAYING at SP, you are also liable to lose what you bet. That may have sounded incorrect, but its like this: Say you enter an SP

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lay bet, lets say you put in 100. What you are actually doing it betting what your Lay Bet LIABILITY is going to be. Then when the SP is decided, the 100 liability is divided by the odds to give you potential lay bet winnings if the horse loses. Now, lets get back to the actual SP trader method. The aim here it so focus on drifters and steamers. I say drifters because more often and not, after drifting out, they somehow come back to win and you can get them at really good odds. Also the steamers are more heavily backed and obviously have something about them if theyre getting well backed by the betting public. Generally you will get better odds on Betfair for a horse than you will with a standard bookmaker. Now, we all know that the big money comes in towards the start of the off. The trend seems to be that, if there is a fairly big drop in odds in the last few minutes before the off, the SP price is more often than not, lower than the actual Betfair price. So our aim for the trading method will be to do a few early checks for the race, then when the 10 minute mark prior to the start of the race comes into play, we wait a few minutes and if the horse is steaming, we LAY the SP price and BACK the normal Betfair price which will give us a guaranteed profit if the horse wins. The same applies to the horse if the odds are rising, the SP odds seem to be higher as well. We want to focus on horses that begin below 4.5 when they are steaming or drifting in order to give us a better chance of the horse winning the race and giving us our risk free bet where we break even if it loses and profit quite handsomely if the horse goes on to win the race. Theres no real point in applying this on horses at 10-1 because they have a far less chance of winning. Basically we will be buying at a lower SP price and selling at a higher Betfair price, or vice versa, depending on the horse. Ill show you an example in a few minutes.

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You may think this sounds fairly simple but there is far more to the SP trader method than just what I have discussed. One other thing you must note, is that the SP prices are only revealed Officially at the beginning of the race on Betfair.

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How to Implement the SP Trader System

Firstly, this is what we do. The bookmakers reveal their odds for the horses generally between 10.30am and 11.30am (UK Time). What we need to then do, is roughly 45 minutes to an hour after the odds are out, is head on over to the Betfair Horse Racing Markets. Roughly between 12.00pm and 12.30pm, go to Betfairs Race cards and Note down all the horses between 2.50 and 4.50. Note down the race time and horses names in the race between 2.50 and 4.50 odds. Once youve compiled this list you can go on to step two which involve having a look at the graph to begin with. Have a look at the below Betfair Graph:

The black vertical line refers to roughly how far along the graph will be at around the 12 to 12.30pm time mark. The graph above represents the

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entire time that the market is open up until the off. Now, what you need to look for is the obvious Steamers and Drifters. Steamers Odds are decreasing over time because more people are backing this horse Drifters Odds are increasing overtime because more punters are choosing to lay (bet against) this horse. Of your list of horses, you need to have a look at the graphs of all of these. Just click the small graph icon next to the name. This brings up the full graph. Now what you need to do is, on your list of horses, note down any clear drifters and steamers.

Below is an example of the type of graph we are looking for. Notice the clear downward spiral and the clear upward spiral. These are the horses you now need to make note of. Cross the rest off of the list. Remember, you should be searching for horses between 2.5 and 4.5. Nothing more and nothing less. Anything less and its under evens (2.0) which is poor value. Anything over 4.5, and youre not realistically looking at a horse which has a good chance of winning the race.

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Monitoring

By now you have your list of horses which are either steaming or drifting. Another idea to double check this and check on their price movements is to head on over to the oddschecker web site (http://www.oddschecker.com) This displays each specific track/race/horse in each race. It allows you to see which bookmakers are offering which odds on any of the horses for the day. Have a look at the screenshot below.

This is the oddschecker site which collects prices from the various bookmakers around the country/world and displays the odds. Youll see most are virtually similar. The colours highlighted in blue means their odds have dropped since their last check and the pink means that that the odds have risen. What you should do, is everyone now and again, say 20 minutes to half an hour, check on a few of the horses just to note their trends and whether or not theyre changing at all. This is not a strict rule that you have to keep checking the odds and what the horse is doing, its more there just to check.

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If you notice that the horse starts going the other way, then we no longer use this horse later on when we complete our actual trades. Any horse which starts going the other way after you have noted your list down is then automatically redundant. We leave horses like this out of it because the fact that the odds changed direction shows it is not a stable investment. Remember, were treating these as investments and any instability in our Stock aka the Horse, is immediately disregarded. Any horse that continues to go one way shows that there is definitely stability. You may be thinking you discussed value and were losing out on value. True, but also not true. Ill show you that when it comes to the actual trading using the Starting Price. With the following screenshot, youll learn the final check for the system, which is the most crucial in order to obtain our value. Take a look at the below screenshot. Focus on the Near/Far odds.

Firstly, Ill inform you in advance the horse (Baunagain), has been drifting all morning/afternoon. About 12 minutes before the off, have a look at the Near/Far odds. Make sure the FAR odds are always higher if you are dealing with a drifter and the Near odds less if its a Steamer. That may sound a bit confusing but its not too important.

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Starting your Trade

For the explanation, were going to be using a Drifter as our example trade. 12 minutes prior to the beginning of the race, have a look at the graph of the horse which you are looking to trade on. In our example, we are looking at a drifter as Ive already mentioned. Open up the graph. Firstly, this is the market

The horse (Baunagain), was our horse from the beginning which we began monitoring early morning. It continues to drift out

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Youll notice how the horse drifted out constantly (based on the graph). You can see the incline and you can see it increase even more towards the start of the race. Note this is about 11 minutes prior to the start. About 1 minute after the Betfair screen above it. Now, this is where the crucial part comes in. Seeing the odds of the horse are INCREASING, it means that the SP is going to be increasing as well. Betfair will end up giving a higher SP as this goes on. The same goes for the other bookmakers. They too will start increasing their prices. So, seeing the horses odds are increasing, we would want to BACK at SP to get a higher price and LAY the standard Betfair price. See below, we would BACK at the SP to gain a HIGHER back price and LAY at the Betfair standard market price to get the original low price.

Now, what Ive done here is placed the LAY bet. I placed it at 3.75 (when it was on the lay side), and it got matched instantly. I laid for 15 Euros. This gives me a total potential profit of 14.34 if the horse loses and I lose 41.25 Euros if the horse wins the race. Now what you need to do instantly here, is BACK the SP. What you must realise here, is that you must back the SP for your liability of the lay bet in order to equal it out. In other words, once Ive placed my LAY bet on the standard Betfair odds, I must back for the same amount that I laid at. NOTE: We want to place our bets 5 MINUTES prior to the start of the race. From 12-5 mins, we keep watching to make sure the odds still move in the direction that we expect them to be going. Take a look at the screenshot below.

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Notice my stakes/bets on the right hand side of the screen. Just zoom in if you cant see it properly. Youll see that: 1) I laid at 3.75 for 15 Euros 2) I backed the SP for 14.34 I didnt do a 15 euro bet due to the commission that Betfair takes. Always make sure you back for your potential profit when dealing with a drifter. Now, lets fast forward into the race.. Just as the race starts, the odds for the SP are officially revealed. (This screenshot was taken at the end of the race).

Just before the race, the horse drifted to about 4.7. When the race started, the odds for the SP were 5.7 which are massive odds. Now, the calculation would be as follows.

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We placed a LAY: 15 x 3.75 = 56.25 56.25 subtract our 15 euro stake and the liability is 41.25 euros which youve already seen.

Our SP BACK bet: 5.7 x 14.34 = 81.73 81.73 subtract our 14.34 euro stake, gives us a potential profit of: 67.39 euros. Now, subtract our liability of 41.25 from the 67.39, which gives us a potential profit of 26.14 if the horse wins... and we lose NOTHING if the horse does not win. Unfortunately, in the example, when the race started, I hedged the bet (by laying at a bit more in play to even out the profit. This should not have been done because the horse won so I lost out on about a 3rd of my profit)

Once again, just zoom in if you struggle to see the above clearly. On the right hand side, notice two bets of 3.3. This is what I placed in play to spread out my profit. You can do that if you want to but I dont recommend it. At the back of the manual, the Betfair guide is there for all

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of you who are not familiar with trading/hedging/backing/laying and any other concept related to Betfair. Just scroll down in this book and youll find step by step explanations with examples.
And what about a steamer...

Now, the example we used above, was a drifter. When you apply this system to a horse which is steaming (dropping in odds), what you will do is: 1. BACK the standard Betfair price 2. LAY the SP The reason being, the odds for the SP should be lower so we will want to get the higher Betfair standard market price and lay the lower SP price to also guarantee us a profit before the race starts. In the same race, we had another horse which was actually steaming the entire morning. Have a look here:

The odds are 3.4 here to Back. We would then back for say 15 or 20 euros. We would then LAY the SP. Remember, you are laying your Liability. In other words, if I backed for 15, I would have to make my lay liability the same amount as my potential backing profit. Cast your eye back to the screenshot where the odds were revealed:

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See how that horses odds were 2.49 Basically you would have been backing at 3.4 and laying at 2.49. This would give you a very healthy profit.

One thing I recommend, is focus on the DRIFTERS first. Theyre easier to do the calculations for your bets. When you are used to doing those, then go onto using steamers. The best idea is to paper trade and this will too be discussed.

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Trading Off By HEDGING (Greening up) Just remember, when hedging your bet using this system, you will only do it while the race is in play. I dont recommend doing it but below is how greening up actually works. When you apply it to the system, you will need to skip ahead to step 2 in the greening up because you will be faced with breaking even or profiting on 1 horse only. You then need to lay that horse in order to spread the profit evenly. Now, firstly the key rules the greening up are: (1) Your lay bet needs to be a bit higher than your back bet. (2) The odds you LAY at must be lower than what you backed at. Let me show you a theoretical example:

Lets say were backing the horse Mismanch at odds of 2.76 for 100. Our potential profit is 169.49. Now lets say were laying this same horse at odds of 2.20. If we were to lay at 100 at 2.20 the screen would look something like this:

Now youll see we would make a potential profit of 53.90 if the horse

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were to win and if not, wed break even. Now to hedge our bet, we would need to enter a larger lay bet than the back bet. The problem is that this is purely mechanical so unless you have a calculator to calculate your hedge bets, you will need to just get used to the various amounts by manually entering the amount into the block.

Now, in the above screenshot (ignore the odds due to it being theoretical), instead of our LAY bet being 100, its 125.45 which gives us an equalled out profit as you can see in the screenshot above. If youd like some links to free hedging calculators just click one of the links below: http://www.oddschecker.com/betting-tools/hedging-calculator.html OR http://www.betcalc.com/backlaycalc.php

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Stakes & Betting Bank

Seeing you are trading, there is far less risk in your betting. But, for the first week at least, you should be paper trading. Keep doing this until you can spot the trend horses quickly. Keep practicing until you are doing the correct back and lay bets and make sure you are backing or laying the Betfair SP at the right time. The more paper trading you do, the better your results will be seeing practice will make perfect. If you learn the process, try it over and over again and then start using real money, it will make your entire betting experience a lot easier and less nerve wracking. What I recommend, is using 15% of your bank at a time per trade. This sounds like a lot but in actual fact, seeing that you are trading, it is far less risk of money than 15%. Your winning trades will far outnumber the losing trades, meaning the bank will constantly grow with the trading method of the system.

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The Value Backing/Laying Method

Learn the art of backing well priced Valuable Favourites

This Method is applied as early as possible before the race.

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Introduction

This method is going to sound a bit strange when you first read it, but after testing it constantly with various bets, youll soon realise just how the winners outnumber the loses all due to the Value I mentioned earlier in the manual. Remember earlier in the manual, I said if you backed 4 horses at 3.5 odds youd make close to, if not double the profit if you backed the same horses at the end of a trend? Well, well be doing that exact thing, except well just be placing straight back and lay bets using a few simple rules coupled with the first signs of the horse steaming or drifting out. This system needs to be applied early in the morning in order to get the best value. Possibly as early as possible! Your bets will all be placed early as well.

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Backing Selections The backing system is quite simple. We just have to apply a few rules combined with our gaining of value before we place our bets. This is how we will implement this. Firstly, there are just two rules here. 1) The race may not be a handicap or maiden 2) There may not be more than 10 runners. 3) The horse must be the first or second favourite. At about 10.00am, head on over to Betfair. Eliminate all races which are handicap races and maiden races. From there, eliminate all races with more than 10 runners. Once you have this list, note everything down. Note down the horses and times which do qualify for the backing method. What we now do is the following. Have a look at the Betfair graph. Seeing there will be very little money in the market at this time, the graph will be quite vague. Look for the steaming graph yet again. If you can see its going to steam Back it. Its as plain and simple as that. The reason we back these horses early is because as the day goes on, the odds are going to decrease further. Seeing we are backing early, we are getting far higher odds for our bet compared to the other punters out there, meaning the fact that we are backing at higher value means that we should constantly grow our profit on the winning bets seeing were getting more worth for the true value of the price of the horse compared to what everyone else is getting throughout the day. Something you may wish to consider, is when you can, trade the selection off. Maybe you come back later in the day, sit down at the PC and notice that one of your selections has steamed in heavily. You can always lay this selection and trade if off. Just refer to the trading section towards the end of the manual.

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Laying Method

This method is virtually the same concept as the backing method, except the only difference is there are different rules compared to the backing system. That and the fact that well be searching for horses who are drifting early on as well. The rules are as follows: 1) Only focus on handicap races 2) The horse must be at least 8 runners 3) The distance of the race must be 5f, 6f or 7f. Nothing higher. The rules sound a bit plain and simple. Many people believe form is the factor behind selecting lay bets, but I have learnt that this is truly not the case. The reason being is, a horse with bad form is obviously going to have ridiculously high odds and the bad run is going to end sometime, meaning when it does win, it wins at a big price meaning, if you placed a lay bet on it, you lose heavily! Now, early morning around 10.00am, exactly the same as the backing system, you then go to Betfair, search for the handicap races and list the races which are handicaps, minimum 8 runners as well as the distance of the race being 5,6 or 7. We focus on ANY horse between 2.80 and 4.00. Just remember, you need to check the graph of the horses. If the horse is drifting out, lay it immediately. We will be gaining the lowest possible lay value (meaning our liability will be fairly lower), compared to those who lay the horse later on in the day when the odds have risen. Once again, if you can, I advise you to trade this bet off. Trading off gives you far better chances of making a pre-race profit. Just hedge your bet!

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Staking Plan & Bank

Lets pretend were starting with a bank of 50 for the backing and the laying.
Backing Bank:

When you back, back with stakes of 4 until your bank doubles. Once your bank has doubled, then double your stake. 50 bank = 4 stakes. 100 bank = 8 stakes. 200 bank = 16 stakes. Keep targeting a double bank. Once you reach your target, you can start doubling up. There is no need to increase stakes on losing bets. The winners will far outnumber the losers in terms of the profit, due to the fact that we are already selection value bets which will always be giving us a higher profit than what we should be getting if we do have a winner.
Laying Bank:

The same goes for here. We lay 2 a time until we double our bank. Remember laying will have a potential loss liability. Also remember, that we are laying at low odds, which means when we do have a horse winning (Which is always going to be a possibility), we dont get hit that hard due to the fact of the odds being low.

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The Betfair Basics Manual

All the Betfair Basics Summed up in a simple Guide

http://www.racingstockmarketsystem.com

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The Betting Exchanges

The Betting Exchanges can be described as an electronic market place. To sum it up lately, the Betting exchanges allow. Betfair was the first to be born in about June 2000 and has taken off to new levels ever since. The betting exchanges have recently come of age. One of the most unique characteristics about the betting exchanges, is that they allow anybody to bet in play. In Play betting takes place while an event is taking place and the odds change accordingly to the real life events of the specific sport. The betting exchanges differ in a few ways to that of standard bookmaker. 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). Lay betting involves betting on a selection to lose the race. The second difference between the two, 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. In the case of Betfair, 5% commission is deducted on anything won. Your commission does vary depending on how many Betfair points you accumulate over time. You basically gain a commission off their commission. 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).

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Below is a list of a few of the more popular betting exchanges around the world. http://www.betfair.com

http://www.betdaq.com

http://www.betsson.com

http://www.ibetx.com

http://www.parabet.com

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The Odds The odds which are also known as prices are what one points to when one decides to take a bet or not. 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 which will be discussed shortly. 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 Overround, which is the extra money standard bookmakers take. This higher price is not always a true 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 4.5 can suddenly move to 3.98 and then up to 4.10 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 examples.

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Decimal Odds [European Method] Decimal odds, which are used on all the betting exchanges such as Betfair, are displayed in decimal format. Odds such as 2.20, 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. Fractional Odds [British Method] 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 odds of 1/1, this is said to be evens 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 Betfair, or in other words, Betting exchange orientated. To Convert from fractions to decimal odds you do the following: Take the fraction such as 9/4. Take the top and divide by the bottom. 9 divided by 4 = 2.25 Now take your answer and add 1.0 2.25 + 1.0 = 3.25

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Betfair: The Monopoly Betfair basically monopolizes the industry in terms of the betting exchanges. It has 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 throughout the day. Betfair supplies the user interface and automatically keeps track of who has placed what bet and where the money is going. When somebody wins a bet, they take a 5% commission on the winnings. If you win 100 of a bet, they will take 5. Do this now. Click http://www.betfair.com and the screenshot similar to the one below should come up. Click the sport tab.

At the top of the Betfair screen in the top left hand corner you will see the Open an Account link. If you do not have an account then I suggest you open one ASAP. While entering your details, you will also see a refer and earn box.

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All you have to do is type in the code 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.

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Backing 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

Lets take the above screenshot as our example. You can see he back odds in the purple column. If we were to place a 100 back bet on Grand Palace The odds are 4.9. If we back with 100, we would win 100 x 4.9 = 490. Subtract your initial stake in this case it was 100 from the 490, and our profit is then 390. Laying 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.

Lay betting is betting on a specific event Not to happen. Take the screenshot as an example below. In this screenshot, the horse Grand Palace has odds of 5.0 to LAY (In the pink block). If we were to place a 100 LAY bet on Grand Palace, we are saying that the horse will not win this race. However, placing 100 pounds has an advantage and disadvantage. Advantage: You will win 100 back instantly Disadvantage: You can lose 5 x 100 (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 5 and multiply them by your stake, which is 100. This gives you a total of 500. You must then subtract your 100 stake, which would give you a total liability of 400.

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Placing a Bet Placing a bet on Betfair is simple. Basically what you need to do is click the horse who you want to bet on. This will bring up a dialogue box on the right hand side of the screen, such as the one in the example below.

Youll notice the Odds box. These odds can be changed to suit yourself. Youll also see the your stake box where you enter your betting stake. Once you have entered your betting amount, click the submit button which is below the above box on Betfair and it will place your bet. Configuring Betfair On any Betfair market, just next to the amount of matched money, youll see the options. The best option is to click this and tick everything you see.

This will give you all pre-profit/loss amounts as soon as you enter a stake in the box.

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Trading 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 100 back bet at 2.90. 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) 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

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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! Liquidity 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 System. 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 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 down.

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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 matched. 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 somebodys 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 matched. 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. You dont really have to worry about liquidity due to the fact that there is so much money being bet on the British races. There are thousands of pounds matched per race. Most of them exceed a million after the in-play has followed the pre-race betting.

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