Matched Betting - A Guide
This guide to matched betting explains how to make a risk free profit at online bookmakers through the technique of matched betting. We're not going to kid you, it's not as lucrative as it once was, but it should still make you a handsome profit if applied correctly. Profiting to the tune of several hundred pounds, simply from initial signup bonuses alone, is still easily doable.
Before we begin we will simply state the obvious, that bookmakers are not charities, and that you will attract unwanted attention to the extent that you are always profitable or only bet when there are free bets on offer. That is why we advise where possible betting such that you are more often likely lose at the bookmakers and win at the betting exchanges.
Finally, at the risk of sounding patronising, do not expect to fully understand this guide the first time you read it. If you do, you are much smarter than us! Some of the betting concepts take a bit of getting used to, but persistance will be rewarded.
What is Matched Betting?
When most people bet, they stake £x with an bookmaker on a particular outcome of an event. For example, that Arsenal will beat Liverpool at the weekend, or that Chelsea will win the Premier League this season. Matched betting, or back/lay matching as it is also known, involves acting both as the punter and the bookmaker. You place a bet both as a punter that the outcome will happen, and also offer (or lay) a bet as a bookmaker that the outcome will happen. Sounds odd, but bare with us.
How does Matched Betting work?
When you make or place a bet at a bookmaker, such as Ladbrokes, you ‘back’ your chosen outcome at particular odds. For example, you could back Team A to beat Team B at odds of 2/1 (decimal odds 3.0). If you won the bet you would receive back your stake of £10 and £20 in winnings (total £30). If you lost, you would lose your £10 stake to the bookmaker.
But what if on the other hand you were the bookmaker, rather than the punter, and offered the same betting odds to someone for the same outcome? Now, if Team A won the match you would have to pay that someone £20 in winnings, and if Team A did not win you would gain their £10 stake. This process is known as ‘laying’ a bet.
Thus, in a perfect world, if you bet on the event both as a punter and act as the bookmaker at the same time, whatever the outcome, the bet side and the lay side of the bet cancel out completely. Look at the examples below:
Outcome 1: Team A Wins
You as Punter win £20 (£30-£10 stake)
You as the Bookmaker lose £20
Net Result = £0
Outcome 2: Team A Does not Win
You as the Punter lose £10
You as the Bookmaker win £10
Net Result = £0
How to make a profit from Matched Betting?
Above we saw how the principle matched betting, or back/lay matching, works; that if you act both as the punter and bookmaker, whatever you win or lose as one is always cancelled out by whatever you lose or win as the other. This might not strike you immediately as an obvious way to make money, but the technique can be used to extract risk free profits from bookmakers' free bets offered to new customers and ongoing promotions, which are offered as an incentive to new and existing account holders. We will concentrate on use of free bets with matched betting in this guide. It is possible in rare instances to profit from mismatched odds without the benefit of free bets, but the topic of arbitrage betting is beyond the scope of this guide. It is also significantly more time consuming (read "less fun") and less profitable in general.
Using online bookmaker free bets to your advantage
A free bet is generally awarded to a punter after they have made a qualifying bet at a bookmaker. The meaning of ‘qualifying’ varies from bookmaker to bookmaker but typically stipulates the minimum bet amount and odds. For example, the punter must stake £25 or more at odds of evens (2.0) or above. Through using the technique of matched betting (as described below) you can lock in a certain profit, ranging roughly from 95% to 75% of the free bet amount depending on the exact bets made and the terms of the bookmakers offer; specifically whether the free bet stake is returned or not (see below).
Let us take the example we used earlier, but instead assume that you as the punter have already made a qualifying bet and so are not staking your own money, but are staking a £10 free bet given to you by the online bookmaker. As you can see, irrespective of the outcome, your profit is £10 (the free bet size).
Outcome 1: Team A Wins
You as the Punter wins £30 (as the bet was free there is no need to deduct this from your profit)
You as the Bookmaker lose £20
Net Result= £10 profit
Outcome 2: Team A Does not Win
You as the Punter lose £0 (as the bet was free losing it incurs you no loss)
You as the Bookmaker win £10
Net Result = £10 profit
Why have we said above that you can expect to secure a guaranteed profit of 95% to 75% when our above example shows a guaranteed profit of £10 (100%)? The answer to that is in our reality check below.
A Matched Betting reality check
Does this sound to good to be true? Well it is and it isn’t. There are a couple of minor points worth bearing in mind. The neat examples used above to illustrate the betting concepts of making profit through back/lay matched betting do not entirely reflect true reality.
Firstly, in order to lay bets you need to use betting exchanges, and these generally never offer lay odds which are the same as those offered by the online bookmakers. Secondly, there is normally always a commission of between 1% to 5% payable on winnings at the betting exchange. Thirdly, sometimes free bet offers do not return the free bet stake with any winnings. The above examples assumed exactly the same back and lay odds, 0% commission and the free bet stake returned with any winnings. Nevertheless, even with these factors, it is still possible to use the back/lay technique to qualify for the free bet with minimal loss, and retain most of the free stake money without any risk at all. This is why we gave the figure of 95% to 75% as a sensible rule of thumb.
Matched Betting: The free bet example
Now that you have a grasp the basics fundamentals of matched betting, the best way to learn is to try it out for yourself. Don’t worry, we will be here to help you each step of the way. We suggest that you work your way through the steps below. They will be necessary reading for your first time and may also be worth bearing in mind when taking part in subsequent betting offers.
Step 1: Find a free bet
The first step is to find an online bookmaker who is offering a free bet. You'll find links the the most reputable bookmakers at the top of this website and we would suggest you start with these. As your experience builds, you'll gain more confidence to use others. Our favourite place to start is Ladbrokes.
As of early 2017 they are offering a £50 free bet which is credited after you have made a £50 qualifying bet on any sporting event. Full details can be found here.
For the remainder of this matched betting guide we will assume you are using Ladbrokes as the online bookmaker. Of course, if you are using a different online bookmaker simply substitute the relevant parts, as the same principles and systematic process should apply.
Step 2: Check the bookmakers' terms and conditions
This is a must! Always read the terms and conditions of all online bookmaker offers. In particular check: (a) whether stakes are returned with free bets; and (b) whether there is a bet through (also known as a play through) requirement before you can withdraw. The answer to these questions will determine what percentage of the free bet amount you can expect to secure, what odds you should be looking to match and whether you are likely to be able to make more profit by setting up the free bets to lose at the bookmaker and win at the betting exchange.
As of early 2017 the free bet stake is not returned with winnings (if any) and there is no bet through requirement.
Step 3: Sign-up at the online bookmaker
After checking the terms and conditions sign up at the bookmaker with the offer, making sure to keep a record of your username and password, as they’re very easy to lose; particularly as over the weeks you join more online bookmakers. When signing up also if possible set your preferences to decimal odds (i.e. 1.2). It is much easier to compare decimal odds when looking at different sites. Bookmakers that don’t ask for your preference when creating a new account often have an option on their main page.
Step 4: Sign-up at a betting exchange
In order to lay bets you will need to sign up to a betting exchange. There are several different exchanges, but the two generally regarded as the largest are Betfair and Betdaq. We recommend Betfair, as it generally has more money flowing through it, which means there is a greater chance of finding good matching odds.
Step 5: Load up our Matched Betting spreadsheet
Make sure you've downloaded our Matched Betting Spreadsheet. The spreadsheet allows you to easily make the calculations required. It also includes a sheet to record your username and passwords (or prompts to) should you wish, a sheet to keep track of all the matched bets you do, and a sheet containing a list of bookmakers with free bet offers.
Step 6: Research the qualifying bet
You are now ready to research and make the qualifying bet. The aim is to find a bet that you can match (same or very similar odds) with a ‘lay’ at the betting exchange so that you will lose the minimum amount of money.
One of the best sports at first is football as there is usually plenty of liquidity (money involved) and the odds do not change too quickly. As we mentioned earlier, betting exchanges generally never offer lay odds which are the same as those offered by the bookmaker, but it is worth spending a bit of time looking odds that are as close together as possible; the closer they are, the less money will be lost on the qualifying bet.
In very rare cases you may find lay odds which are less than the back odds. This situation is referred to as an arb (short for arbitrage), and instead of guaranteeing a small loss, you will guarantee a small profit.
It is important to stress the point that you do not chose opposing outcomes, e.g. if you were to back Arsenal to beat Liverpool, you lay Arsenal to beat Liverpool, not Liverpool to beat Arsenal. This is because when laying bets you are acting as the bookmaker and make a profit when the outcome does not happen, so you are in effect gambling on that outcome not happening.
As an example, let’s say that you can back Arsenal to win at 1.5, and lay Arsenal to win at the betting exchange 1.55.
Now load up the Matched Betting spreadsheet, and using the Matched Betting Calculator enter £50 for the Back Stake. This is the size required for the qualifying bet at Ladbrokes. As you are making the qualifying bet with your own money enter £0 for Of Which Free, as this only applies when making a free bet. There is also no stake forfeit on the qualifying bet, so enter the Stake Forfeit as £0. Taking the odds we found above, enter the back odds as 1.5 and the lay odds are 1.55. There is no commission at the backing bookmaker (Ladbrokes), so enter 0 for this, but there is a commission at the betting exchange. Assuming you are using Betfair this is 5%. It is possible to get a discount on the rate of commission at Betfair, but only if you are an active better.
The matched betting spreadsheet will work out all the numbers for you. Importantly, you will see highlighted in yellow a lay stake which equals £50.00, and the lay risk will be calculated as £27.50. The Net Profit shows you that whatever the outcome your loss will be £2.50.
At the betting exchange underneath the lay odds you will see a number in pounds, which is the amount of stake money actually available at the betting exchange. It is important to make sure that this amount is greater that the lay stake as calculated by the matched betting spreadsheet.
Step 7: Deposit at the bookmaker and betting exchange
You will now need to deposit £50 at Ladbrokes, and deposit an amount greater than your lay risk (£27.50) at the betting exchange. A common mistake is people think that they need to deposit a sum equal or greater than both the lay stake and lay risk combined, which is incorrect. It is the lay risk which calculates what you as bookmaker would be required to pay out to the person acting as punter, i.e. the loss you must be able to cover. We have said that you should deposit an amount greater than your lay risk is it allows flexibility in case the odds were suddenly to change by a small amount.
Step 8: Place your bets
You now need to place your bets, and this is the point at which you must be most careful as mistakes can be quite costly (particularly later with larger bets). First place the bet at Ladbrokes but do not confirm it; simply leave the window open at the final stage; a function which is available at all bookmakers. Then click on the relevant lay odds at the exchange, and enter the value of £50 (you lay stake as calculated by the spreadsheet) into the stake box. The exchange will then calculate your risk which should be equal to £27.50; the amount the spreadsheet calculated as your lay risk. Return to Ladbrokes and confirm your bet, then back to the exchange and confirm the lay. Finally, check your account details at both sites to make sure (1) the right bet has been placed, (2) the amounts are right, and (3) you have backed and layed the same outcome.
If everything is OK you can sit back and wait for the event, and for the free bet to be credited to your account. After the event, you will either have an increased balance at the bookie or betting exchange depending on the outcome of event.
Step 9: The free bet
In order to extract the money from the free bet you simply need to repeat the process with another event. In some instances the free bet is credited after you have placed the qualifying bet but before the event you have bet on, in which case it is possible to place the free bet on the identical event/outcome etc.
For the Ladbrokes £50 free bet, using the matched betting spreadsheet again you would enter your back stake as £50 again, but this time you would also enter £50 in Of Which Free. Using the same event and odds above, you will now see that whatever the outcome of the event your net profit will be £15.83.
Thus we would have a guaranteed loss of £2.50 on the qualifying bet, and a guaranteed profit of £15.83 on the free bet, for a total profit of £13.33; simple!
At Step 2 (Terms & Conditions) we said that the Ladbrokes £50 free bet stake is not returned with winnings, and that there is no bet through requirement, but it is useful at this point to explain how such factors should affect your approach.
If you return to the matched betting spreadsheet and leave everything the same as above, but now remove the £50 for "stake forfeited" you will notice a drastic increase in your net profit to £47.50. Where the stake is forfeited the way to maximize your profit is to the find high matching odds, i.e. 4.5+, but the higher the better. For example, by replacing the odds of 1.5 and 1.55 on the spreadsheet with 4.5 and 4.6 you will see the net profit increases to £36.54. Where the free bet stake is forfeited you should be able relatively easily to obtain a profit of approximately 75% of the free bet amount.
If the online bookmaker has a bet through requirement before you can withdraw the free bet money and winnings, then it is a good idea to match at high odds with the intention to lose at the bookie and win at the betting exchange. By doing this, you will hopefully avoid having to place several matched bets to meet the requirement, each time making a small loss before you can cash out.
Which are the best free bets?
We have suggested that you start with Ladbrokes. Once you have done Ladbrokes, we recommend you continue with other similarly reputable bookmakers, the links to which are contained on this site. These will allow you to build up your confidence and bankroll (/beer fund).
Once you have claimed these, you may wish to consider online bookmakers which, instead of offering free bets, offer percentage deposit bonuses. An explanation of deposit bonuses is found directly below.
Online bookmakers with percentage deposit bonuses
Many online bookmakers also offer percentage deposit bonuses. For example, if you deposit £100 they will credit your account with a 20% (£20) deposit bonus. Almost certainly they will have a bet through requirement which combines the deposit and the free bonus. EG - If you were to make a deposit of £100 and received a 20% bonus of £20 you may have to bet through (commonly 3 times) £120 at specified odds or greater before a withdrawal can be made from the online bookmaker
There are a number of ways you could approach maximising the profit from such a bonus, and the best way to an extent depends on the size of the bet through requirement. If it is small bonus, then making several small matched betting against low matched odds may secure the greatest profit. However, where the deposit bonus is large, arguably the best way is to attempt to lose at the bookie to avoid multiple losses incurred with making several matched bets to satisfy the bet through requirement. Therefore, you would bet both your deposit and bonus amount all at once. The Matched Betting spreadsheet allows you to calculate how much money you can make, for example, given the example above you would enter the Back Stake as £120, and Of Which Free as £20.
Matched Betting: What can go wrong?
There are only two real things that can possible go wrong when matched betting and placing bets at an online bookmaker. The first is human error, for example, entering the wrong odds, or not backing and laying on the same outcome. This, however, with concentration and checking should be avoided. The second is that some bookmakers reserve the right to cancel bets if they have made a ‘palpable error'. Again, however, this is rare, is in most times obvious, and is more likely to arise when you are looking for Arbs, so doesn’t warrant any further discussion here.