What is odds trading?

In the stock market stock prices move and you trade them. In a betting market odds move and you trade them. It’s almost as simple as that. Let’s have a look.

In the stock market you ‘buy’ and ‘sell’ stocks. The equivalent of this in betting is called ‘back’ (making a bet) and ‘lay’ (offering a bet/being the bookie). So if you imagine making a bet, and then immediately offering the same bet to someone, your position would be neutral. Easy right?

Now here is the tricky part. How do I calculate my profit when the odds move, and how do I know how much I have back/lay to offset my other bet?

Firstly- we calculate both of these things for you, as well as automating many simple processes for your convenience, but if you want to see how it works keep reading.

If I bet $5 on Manchester City to win the English Premier League at odds of 4-1, then I own a ticket that pays

if City win.

Now let’s say City is winning a lot of games and the odds drop down to 2-1. In order to buy a ticket that pays $20 if City win, now I need to bet $10. What does that mean? The ticket I bought for $5 is now worth $10! That is $5 profit.

How do I lock in the profit? I lay the amount that the ‘back’ bet is worth, $10. So if I lay $10, now if City win the EPL I receive

And if City do not win I keep

Which give the same profit regardless of the scenario.