• BetChamps
  • Neds
  • Unibet
  • BoomBet
  • TradieBet
  • Picklebet

The basics of Sports Trading

Sports Trading

Trading on sport uses the same concepts as trading on the stock exchange or in real estate.  Buy low and sell high = making profit.  In sports trading, instead of the terms “buy” and “sell” we refer to the terms “back” and “lay”.

To “back” a team means that you are betting on them to win.  It’s the most traditional bet format used at most sports betting agencies around the world.  If you “lay” a team, then it’s the opposite as you are betting on them to lose.  Betfair is the most popular sports betting exchange that allows punters to both back and lay.

So in order to make money, without taking a risk on the actual result, all you need to do is back high and lay low.  It doesn’t matter whether you back or lay first, and it doesn’t matter whether the market is rising or falling.  Much like the stock markets, as long as the price is moving, there’s opportunity to make money.

Let’s take a look at an example:

You back the horse "Puffing Billy" to win in Race 4 at Flemington.  You put a $100 back bet on ten minutes before the start of the race at odds of 6.00.  Your position is:

Puffing Billy wins – You win $500
Puffing Billy loses – You lose $100

Suddenly there’s a late surge of money for your horse and its odds shorten to 4.00.  You can now lay this horse and reduce, or even remove, your liability.  You decide to lay the horse for the full $100.  Your position is now:

Puffing Billy wins – You win $200 (+$500 from the back bet, -$300 from the lay bet)
Puffing Billy loses – You break even  (-$100 from the back bet, +$100 from the lay bet)

When you lay the $100 at 4.00, your liability is $300, and combined with the $500 you made from the back bet, your overall position is +$200 if the horse wins.  So you’re in a strong position and effectively “freerolling” Puffing Billy to win.  But what if it doesn’t win?  You don’t lose anything, but you don’t win anything either.  Wouldn’t it be nice to lock in a profit regardless of the result?

With this position, you can achieve what is referred to as a “green book” (or hedging) and that is when you guarantee a win regardless of which horse wins.  To do this, we could’ve laid for $150 instead of $100.  Here’s how that changes the numbers:

Puffing Billy wins – You win $50 (+$500 from the back bet, -$450 from the lay bet)
Puffing Billy loses – You win $50 (-$100 from the back bet, +$150 from the lay bet)

Now we win $50 regardless of the result!  That’s the ideal position to be in, and should be a goal of any trader to achieve a green book.  Remember that this can be achieved on any sport – horse racing, cricket, football, golf, tennis...it doesn’t matter.  It’s the same technique.  You can also do this both pre-game or in-play.

In order to work out how much to lay to lock in a profit you can use software or a hedging calculator.

There are many trading strategies that can be employed in order to achieve a green book and we’ll discuss these in more detail in future articles.

Horse Racing Tips

View More

Our team of expert horse racing analysts bring you regular horse racing tips from major horse racing meetings in Australia and internationally. The highlight of the Australian horse racing calendar is the Spring Carnival, featuring the Caulfield Cup, Cox Plate and, of course, the Melbourne Cup, and we'll be there riding every winner home with you with our free racing tips and best bets. Giddy up!

NFL Tips

View More

NFL tips and best bets for the 2024-25 NFL season. Arguably America's most popular sport, the National Football League is gaining popularity in Australia with all marquee games plus the 'Red Zone' coverage on ESPN Australia. We have you covered with regular NFL betting tips of all of the key matchups of the week.

NBA Tips

View More

NBA betting is very popular in Australia and we have free NBA betting tips all season long with our best NBA tips for the biggest games every week, along with coverage of the NBA Finals.

NBL Tips

View More

The NBL is the largest basketball competition in Australia with a rich history of developing the country's best basketball talent. The NBL has enjoyed a resurgence in recent years and we'll have NBL tips and betting previews for every match of every round for you right here.