Betting exchanges revolutionised the betting industry by essentially taking away ‘the edge’ from betting markets, an edge which was exclusively to the advantage of the bookmaker.

They provide a platform where punters can bet against each other, and because the middle man is eliminated (i.e. there is no bookmaker involved) the odds that you get will be the true price generated by market force. The only snick for the punter is that the winner must pay a commission (typically 5%) to the operator. Betting exchanges provide a grand-scale platform equivalent to betting with your mates down the local pub.

Decimal odds are the conventional form of displaying odds for online betting exchanges. They come in the form 2.0 or 14.5 for example and once you become familiar with them they can be much easier to work with. All you need do is multiply your stake by the decimal odds to see your return (including your stake), so a £50 bet on a winning selection at odds of 2.0 will return £100 (£50 profit, £50 stake) or a £50 wining bet at odds of 3.4 returns £170 (£50 x 3.4).

The very nature of a betting exchange means that they provide the opportunity for the punter to ‘Lay’ a selection. Laying can be a difficult concept to get your head around but essentially, the layer is just playing at being the bookmaker. To lay a selection is to bet on it not to happen, i.e. a lay of Manchester United would be to predict that they will either draw or get beat (or that they will not win).

Most betting exchanges have a tutorial section to their website and they can be very handy to use to get your head around how it all works.

Recommended Exchange: Betfair
Betfair is the largest betting exchange and usually offers the best odds anywhere on the internet. It’s worth having an account with Betfair, as well as a few traditional bookies – click here to register for a free bet.