Bookmaker or betting exchange? Who has a greater value?

First thing first, for those who don’t know what the betting exchange is, it’s a betting website which doesn’t accept bets instead, it allows punters to back (wager) and lay (offer), taking the commission from either side’s profits (usually 2-5%). Such a system allows for a wider variety of market offers.

Why did they get so popular? Tipsters become more and more educated and end up being capped by the bookies. The exchange pretty much works the same as the traditional bookmaker with some minor differences. The biggest one is that when it comes to the traditional way, bookmaker only allows you to place a bet. The company behind it determines the odds and establishes limits in order to make profits. On the other hand, we have exchanges, where bettors are playing against each other with both lay and bet options.

Comparing the odds of the two models, we can see the first distinctive difference. Top online bookmakers factor in a so-called margin that ensures their profits regardless of the bet outcome. This results in odds representing a not exactly true market value. In case of the betting exchanges, the odds are laid by bettors themselves. They do not factor in any margins or anything like that. Instead, the share is taken out of generated revenues. This clearly brings up exchanges over the bookies in terms of odds quality.

Advantages and disadvantages of a betting exchange