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Events such as the Grand National present unique trading opportunities if approached with care.
Because of the large amounts of money involved at both the traditional bookmakers and on the betting exchanges then the prices or odds of the horses involved will tend to be fairly set in stone.
This means that 'market making' trades can be made on certain selections. That is, place a back bet at the lay price and a lay bet at the current back price. Once both bets have been matched you are in a risk-free profit situation. The magic of the betting exchanges means that bets such as this are possible!
For example, have a look at Kauto Star here:
You can see that a large amount of money has been bet on this horse. This image was taken 20 minutes before the off! Also note that the price is fairly stable. These are the exact conditions we need for placing our bets on each side of the book.
Let's have a look at an example bet here:
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Let's say I want to risk £100. So I place a back bet at the current LAY price of 1.67. Giving me a potential profit of £67 should the horse win.
At the same time I place a lay bet at the current BACK price of 1.66. This will give me a potential liability of £66 should the horse win.
Once both bets have been matched then I will enjoy a risk free bet on the odds-on favourite! I can repeat the process as many times as I like so long as the market remains stable.
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But there is a risk. At around ten minutes before the off, the horses are paraded. Someone might notice a slight limp, or that one of the horses looks in better-than-expected shape. This could affect the market and the prices will move to reflect the new confidence levels against each runner.
In this next image you can see the effect of large amounts arriving in this market.
You can see that over £30,000 arrived in the market at once. This was obviously a back bet as the price moved down. Not by much to start with but then by a couple of ticks before settling at the new level of around 1.63. If you are caught on the wrong side of this move then scratch your bet and begin again when the markets settles.
The race used in this example was not the Grand National itself but a race earlier in the same meeting. Kauto Star lost!
Tools such as Bet Angel Professional or make it easy to place these market making trades on either the ladder interface or by using the dedicated 'Make Market' button! |
