Matched betting, or back and lay bet matching, (also referred in the United States as double betting) is a betting technique used by individuals to profit from the free bets and incentives offered by bookmakers. It is generally considered risk-free as it is based on the application of a mathematical equation rather than chance. A typical return for a matched bet where the stake is returned is 85%+ of the free bet offer amount, and 70%+ where the stake is not returned.
The concept of matched betting requires an account with a bookmaker who would offer a free bet with favourable conditions, and at a betting exchange, which is required to offset the loss made at the bookmaker. Generally, bookmakers would incorporate terms in which that individuals must first place a bet using their own money in order to qualify for the free bet. For this, a bet is placed on a particular results occurring with the bookmaker and a second bet placed on the same result not occurring at the betting exchange. The latter is required to offset any loss in the event that the result does not occur, for instance, if a team loses. Once the free bet has been qualified, the same process is followed with the exception that a free bet is being used. No matter which result occurs, there will always be a guaranteed profit because the bet was made free of charge.
There are three different approaches to matched betting, manual, assisted and automatic.
There are a number of websites and software packages that claim to help people take advantage of free bets using matched betting automatically. Automatic websites or software packages are usually aimed at individuals with little or no experience in matched betting. Automatic systems will automatically scan the market, calculate the right bet to minimise the initial loss and maximise the return on the free bet. The system will then provide the individual with instructions as to how to place the bets to generate a profit. These websites usually filter out offers where there is a mathematical chance of making a loss to ensure users cannot put their money in offers where they could lose money. The websites are usually financed by advertising, affiliate programs, commission on winnings with a betting exchange and membership fees.
Assisted matched betting refers to websites or software packages which provide comparison tables of markets for individuals to bet on. These are commonly known as 'auto-matchers'. Auto-matchers are usually used by individuals who have an understanding of matched betting. Auto-matchers will usually provide the individual with a matched betting calculator to be used in conjunction with the comparison table, in which the user can select the type of bet, stake, bonus and time-frame. Assisted matched betting websites are usually financed by advertising or by affiliate programs.
Matched betting manually is where the individual finds the offers, markets and odds him/herself and also makes the relevant calculations. Matching the right odds can be time consuming and may require a high level of numeracy and betting knowledge. There is the potential for the individual to make more money than with automatic matched betting, because he/she can take advantage of offers where there is a mathematical risk of making a loss.
Matched betting is perceived to be risk-free because the a portion of the free-bet offsets any potential losses and betting exchange commission.
Note that the following example uses indicative figures.
- Bookie X offers a £10 free bet. First, the individual has to make a bet of £10 with Bookie X to qualify for this.
Bookmakers often require individuals to make a bet before giving them the free bet.
The first stage is to qualify for this free bet – e.g. making a £10 bet with Bookie X for England to win. There is a chance that England might lose – in which case, you would normally lose the £10.00. This bet is referred to as the Back bet. However in matched betting, this loss is minimized by placing a bet at the same time at a betting exchange for England not to win ( i.e. to lose or draw). This is called a 'lay bet'.
By applying the correct equations, the individual making the bets knows how much to place at the betting exchange so that no matter the outcome of the England match, the same small loss will be made (typically under 10% of the value of the free bet offer). However, by making this initial bet, they have then qualified for the free bet.
The second stage is to use the free bet, for example, making a £10 back bet with Bookie X for France to win. Again a lay bet is placed for France not to win to offset any loss.
The mathematics of matched betting means that the profit made is identical, regardless of result. In this example, it is assumed that the overall profit from this match is £8, since any loss is offset by larger winnings achieved through laying this bet. This means that matched betting individuals will know for sure how much profit they will make before the match starts. Less the initial loss, the matched better's net profit is £7.00.
- Betting exchanges charge a commission on winnings made.
- Free bets may have terms and conditions attached to them. For example, a bookmaker may stipulate that an initial bet is placed at odds of 2.00 or over before you can qualify for their free bet.
Matched betting is legal and a spokeperson for William Hill has indicated that the betting industry does not have a problem with this use of free bets