Lay betting is a form of betting offered by a betting exchange whereby the bettor can back an outcome to lose. A lay bet will be successful if the selected outcome does not win the event. For example, the favourite for the race might be $3. If you were to ‘lay’ the favourite at $3 to win $50, you would be risking pay out $100 if the horse wins.
A betting exchange is a trading platform whereby bettors can exchange bets. Bettor A thinks that Team A will win, Bettor B does NOT think that Team A will win. The two bettors trade at a price agreeable to both. A betting exchange is very similar in operation to a stock exchange.
Lay betting is available with all betting exchanges. Betfair is the world’s largest betting exchange and therefore has more liquid markets and provides greater availability of lay betting opportunities.
The example shows the market for A tennis match between Djokovic and Nadal. The back odds are in blue and the lay odds in pink. The darker pink cell shows the lay bet. The bet is to lay Djokovic to win the match meaning that we believe that he will not win. The cost of putting on the bet per $1 is 63 cents. If the lay bet is successful and Djokovic loses, the bet will return $1. If the lay bet is not successful and Djokovic wins the match, the bettor will lose 63 cents.
The selected bet is to lay Black Caviar to win the race meaning that we believe she will not win the race. The cost of putting on the bet per $1 is 12 cents. If the lay bet is successful and Black Caviar loses, the bet will return $1. If the lay bet is not successful and Black Caviar wins the race, the bettor will lose 12 cents.
Lay betting is not available with all betting sites as it is not possible to place a lay bet with a bookmaker and bet that an outcome will not happen. Only betting exchanges allow you to place lay bets. The recommended betting exchange is Betfair because the liquidity is so good meaning that if you want to place lay bets, you do not have to pay such a premium (higher odds) to do so.