Lay Betting Explained: A Complete Guide
If you are new to football betting or the industry as a whole, you might have seen the term ‘lay bet,’ but you’re not fully sure with what it means.
Lay betting explained in simple terms is when a punter plays the role of a traditional bookmaker and rather than backing a selection to win, you place money on something to NOT happen. Rather than heading to a high-street bookmaker, bets are placed on lay betting systems on Exchanges such as Betfair.
Our in-depth guide answers popular questions such as ‘what is a lay bet?’, ‘how to place a lay bet?’ and more, so hopefully, this guide and a hand from our football tipsters can help you can decide whether lay betting is right for you.
What is Lay Betting?
A traditional bet - back betting - is putting your money on something to happen. Lay betting is the opposite of this and you place money on something to NOT happen. These are both components in every bet, but the lay side was traditionally represented by a bookmaker and they offer customer odds that they want to lay.
When punters place lay bets, they are selling a bet to other users rather than buying. Bettors can both back and lay, as well as ‘match’ bets with fellow punters instead of a bookmaker.
Lay Betting Odds Explained
It's not just the process behind lay betting that differs from a traditional back bet, the terminology also varies and understanding this is so important before you rush into placing a bet.
We explain the expressions around lay-betting, ways to place a bet and the biggest differences between winning or losing a lay bet, compared to in a back bet.
Example of Lay Betting
So you’re starting to understand the thinking behind lay betting, but you're still not sure how it would work in your favour. A contextual example is:
If you are confident that Arsenal has no chance of winning the Premier League, you can lay a bet against them instead of backing them. By placing this lay bet on Arsenal, if anybody else wins the Premier League, you will win your bet. But, if Arsenal DOES go on to win the league, you would lose your bet.
What is the Difference Between a Back and Lay Bet?
You need to think of lay and back bets as complete opposites.
To ‘back’ a choice in betting means placing money on something to happen. Back betting is the most traditional type of bet placed with a bookmaker.
To ‘lay’ a choice in betting means placing money on something to NOT happen. You are betting against something happening - the opposite of backing.
Thinking back to our Arsenal example, placing a ‘lay’ bet on Arsenal means you are playing the role of the bookmaker and betting that Arsenal DOESN’T win the Premier League.
If you place a lay bet on Arsenal in an Arsenal vs. Liverpool football match, and Liverpool goes on to win, you would need to cover the payout for the winnings in the same way a traditional bookmaker would.
If you placed a traditional ‘back’ bet on Arsenal, this means you are betting money on them to WIN the Premier League. If Arsenal wins, you win your bet; if they lose, you lose your stake but you don’t have to cover any winner’s payout.
Understanding Liability, Liquidity and Profit
In lay betting, the meaning of liability, liquidity and profit differ from back betting. It’s important to understand these terms before you decide if lay betting is right for you.
Liability is the amount of money that you could possibly lose:
If you place £5 on a traditional bet and your selection doesn’t win, you only lose your £5 stake.
For lay bets, you are the bookmaker, so you would lose your £5 stake but you will also have to pay the winnings, which could be a lot more than your original stake. This potential payout is known as your liability.
Liquidity is the maximum amount of money a bettor can ‘lay’ or ‘back’ in a betting exchange. Because a betting exchange is between two punters, rather than a bettor and a bookmaker, users can only match a bet if there’s enough money waiting on the other side.
If a punter tries to place a bet that’s larger than the available liquidity, the betting exchange will not accept the bet.
Lay Betting & Betting Exchanges
If you're wondering where or how to place a bet, you should know about Betting Exchanges.
Exchanges have completely changed the betting world and transformed the way bettors place their money on sports bets. Exchanges have opened up the industry for in-play markets, cash-out options, improved lay odds for bettors and increased the popularity of lay betting.
When you bet on an Exchange you are placing against other punters and not a bookmaker, so Exchanges make money through gambling commissions and not profit margins.
Exchanges usually allow you to bet on everything that a traditional bookmaker offers, and there is a choice of odds to bet on, but these change as more punters place bets.
Betfair is an example of a popular Betting Exchange.
What Happens if You Win a Lay Bet?
A bet always has two sides, a 'lay' and a 'back' better.
When you place a lay bet, you are betting on something to not happen, whereas the backer is betting in favour of something. So, when your predictions and lay bet are correct, you will win the backer's stake. If the backer's bet wins, you have to pay the winnings, also known as your liability.