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What is Matched Betting?

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Matched betting is a betting technique used to take advantage of free bet promotions offered by online bookmakers to make essentially risk-free profits.

It involves putting down money on both sides of a two-outcome bet: ‘placing’ the free bet at the bookmaker and ‘laying’ a second counter-balancing bet with a betting exchange, in order to turn the free bet offer into profit.

Matched betting works because both of the bets placed cancel each other out (ie. one wins and the other loses), leaving you with the sum of money equal to the free bet offered by the bookmaker.

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

To understand matched betting it is vital to distinguish the difference between ‘placing’ a bet with a bookmaker and ‘laying’ a bet with a betting exchange.

When placing a bet with a bookie you are betting for an outcome (eg. Team A to win) and get paid out if it happens.

In contast, when ‘laying’ a bet with a betting exchange you act as the bookie, offering the bet (eg. Team A to win) to others and essentially betting against the outcome of the bet (eg. Team A to draw or lose).

As a result you get paid with the money ‘laid’ by the person betting if the outcome in question does nothappen.

Bet365 and William Hill are examples of online bookmakers while Betfair is an example of an online betting exchange.

How matched betting works

Let’s say you see an advertisement online for a £20 free bet for signing up to an online bookmaker and want to make your matched bet on how many goals (let’s say in this case, +2.5 goals) will be scored in Premier League football match between Arsenal and Manchester United.

If you were to ‘place’ this free £20 bet with the bookie at odds of 3.00 (2/1 in English odds) and there were over 2.5 goals, you would win the bet and receive £60 profit (the original £20 free bet and £40 made in profit on the bet).

If there were under 2.5 goals you you would lose the bet yet lose no money because the £20 bet laid was a free bet.

This in itself is risk-free bet because you cannot lose any money, but the chance is also there that you may not win anything and this is where ‘laying’ a counter-balancing bet with a betting exchange turns things in your favour.

Indeed, if you were to ‘place’ the above bet and also ‘lay’ a counter-balancing bet as a bookmaker at a betting exchange (offer someone a £20 bet for the same outcome, at the same odds) then regardless of the outcome, you will make a £20 profit due to the free bet offered by the online bookie.

On one hand, if you win the bet with the online bookie and lose the bet with the betting exchange you will win £60 (as explained above) and lose £40 (the money you have to pay to the person who wins your counter-balanced bet) respectively, leaving you with a profit of £20.

It is important to remember that you don’t have to pay them the £20 that they used to make their bet; that is their money and not yours.

On the other hand, if you lose the bet with the online bookie and win the bet with the betting exchange you will lose £0 (as explained above) and win £20 (the money that the person who loses your counter-balanced bet) respectively, leaving you with the same profit of £20.

Technicalities in matched betting

The conceptual example shown above indicates that it is possible to make a profit identical to the free bet listed by an online bookie.

But the truth is that things are not so simple and there are some technicalities that lesson this profit that you should be aware of:

  • Betting exchanges generally charge a 5% commission on winnings made
  • There is often a small difference between the odds given to ‘lay’ bets and the odds given by an online bookie
  • Many free bet offers have terms and conditions that need to be investigated and understood before a matched bet should be made

Taking these technicalities into account it is still possible to take advantage of the huge number of free bets offered by online bookies, make the appropriate two-sided bets and come away with a decent short-term profit.

Further matched betting resources

Disclaimer: Please note that this article does not promote the act of matched betting – but simple seeks to provide information on the topic.