Which Have Better Odds of Enticing Users: Betting Exchanges or Regular Bookmakers?

Around the dawn of the millennium, betting exchanges were introduced as a brand-new, revolutionary idea. Why not gamble against your peers on an exchange where the exchange takes a cut of closer to 5% – just the percentage derived from winning bets – as opposed to laying your bets through a bookie, a middleman who normally takes a share of approximately 20%?

Despite offering significantly higher odds, the ability to place and accept bets, a greater in-play selection at the time, and the fact that you were not going to be restricted or barred, exchanges took a while to gain any traction. However, they did eventually catch on, and before long, the major player on the exchange market was managing more transactions each day than all of the European exchanges for stocks put together, generating billions of pounds and euros in bets, and taking home innumerable accolades. But how well does the main pro regarding exchange truly hold up? Which, in essence, offers better odds when it pertains to fixed odds – bookmakers or betting exchanges?

Do Fixed-Odds Bookies Offer Better Odds Than Betting Exchanges, or Is It Vice Versa?

Exchange proponents, most often the exchanges themselves, advertise the fact that their odds are substantially better than those offered by “typical” bookmakers. This was unquestionably the case for many years across all of the major marketplaces and in general. However, this fresh rivalry compelled established bookmakers to raise their odds. As exchanges gained popularity, this grew even more true.

Bookmakers noticed that an increasing number of their clients were turning to the exchanges as a whole generation was practically raised to recognize them as a standard choice, rather than initially viewing them as a puzzling option that employed peculiar odds and provided two sets of prices. The difference between the rates supplied by a fixed-odds bookie and the odds at the exchange shrunk as a result of their being forced to lower their margin and raise their odds, at least anecdotally. So where are we at this point? Do exchanges actually offer better chances after accounting for commissions?

Options and Variables

In other words, because there exist so many factors and possibilities, not just one, straightforward response can accurately capture the situation. Leading exchanges and renowned bookies have both asserted that they offer the greatest odds at various points in time. These are often based on studies that the business in concern has commissioned that have only examined a certain time period, a limited number of sports, and certain markets.

The truth is that you have to double-check every single time if you are interested in placing your wagers at the best odds available. Although there are programs that make this quite simple, this is the one way to guarantee that you get the greatest price. Simply put, odds fluctuate, and sometimes you will find the best deal at an exchange and other times through a bookmaker. The position might have changed by the time you check again 30 minutes later.

Obviously, we are only examining one market here. Every single day, there are dozens of sports, several hundred competitions, and thousands of betting markets available. Bookmakers would quickly go out of business if betting exchanges consistently supplied the most favorable odds on every market and every option, all the time. Uhm, is this the bare truth or it is not? Keep reading…

Who Holds the Best Odds in General?

We strongly advise comparing pricing at several websites, including exchanges, before placing a wager if you are an exceptionally knowledgeable, odds-conscious customer. Many of us lack the time or desire for such things, though. If you are a common, leisure bettor who enjoys the fun of placing bets, whether it be practically daily, occasionally, or even infrequently, you may only want to choose one or two betting websites and place all of your bets there.

Which typically has the best odds if such is the case? Again, the simple answer is that there is not a single one because it all still depends on your personal betting preferences, including your favorite sports, markets, and, probably most importantly, odds. Given that we are to portray a relatively average bettor who enjoys making wagers for fun, let us presume that the sports we are discussing are a reasonably typical selection of Canadian sports.

If we assume a pretty typical Canadian bettor, they probably favor betting on hockey above all other sports, especially the NHL and AHL. Additionally, they presumably bet on certain seasons’ major basketball games, the occasional game of baseball, and the major boxing, football, and matches. Let us not forget that Canadian punters like to try their luck in horse races too, especially in Alberta. So, should they employ a fixed-odds bookmaker or an exchange?

We would cautiously support the exchanges if we were forced to respond to this question. We would have to add a disclaimer stating that there can be a great deal of fluctuation and that timing and the markets you choose to gamble on have a significant role. However, after their commission, the majority of betting specialists would undoubtedly concur that exchanges generally offer marginally better odds than any individual competitor on the betting market.

This last element is crucial since it would not be appropriate to contrast the two or three major exchanges with the more than 50 fixed-odds bookmakers if you only want to place bets with one or two websites. Instead, we ought to contrast just one exchange with just one bookmaker. And in this case, we are convinced that the exchange would prevail, likely providing odds that are normally 5% greater (even after accounting for the customary 5% commission).

Nevertheless, as empirical as it may seem, we will perform our own odds comparison by choosing a variety of wagers that our hypothetical bettor might make. Here, we will examine the top exchange in the globe and contrast it with the top 20 Canadian bookmakers in 2023, treating fixed odds websites as a unified, integrated whole. We are slightly tipping the scales in their favor, but how will the exchange actually fare?

For convenience of comparison, take note that odds are reported in decimals and rounded to a maximum of two decimals. Results are for illustrative purposes only and compare one exchange with the best odds offered at the time of study by a number of significant bookmakers operating in Canada. Exchange odds are based on a 5% base commission.

The table above demonstrates that, depending on how you compare odds from several bookmakers, an exchange may occasionally provide better odds than a fixed-odds bookie. Out of the 7 wagers we completely at random chose, the traditional bookies won two by a very small margin, the exchange won four times as much, and it won one by a huge margin.

Exchanges Are Typically Best for Outsiders

Although the odds provided by the bookie for Jiří Veselý, the world’s 121st-ranked player at the moment, to beat Novak Djoković are actually higher than those provided by the exchange in the table above, in general, it pays to choose the exchange when outsiders are facing significant odds. There are a few reasons why this makes sense.

First, the major sports and events and the favorites receive the most bets. Bookmakers understand that they must raise their odds in order to compete for a piece of that pie. Second, studies have revealed that, at best, people have a rudimentary understanding of probability. Your ordinary bettor can far more readily understand the odds, probabilities, and relationship between the two if an event has two or three outcomes and these are all priced pretty evenly. However, things are far more difficult in a horse race involving 16 competitors.

However, comprehending the distinction between 60/1 and 80/1 is more challenging than knowing the distinction between evens and 2/1. Additionally, it is generally accepted that gamblers who support picks at odds this high are less focused on value and more interested in securing a sizable payout. As a result, the bookmakers believe they can give outsiders somewhat lower odds while still attracting customers, which means their margins can be significantly higher than what is feasible in markets that are more competitive and transparent.

Our Djoković scenario illustrates that this could occasionally not be the case. However, if a large portion of your wagers is on horses at double-digit odds, correct soccer scores, outright tournament wagers in golf, and other comparable markets, you might find far better values at the exchange. Fixed odds sites, on the other hand, typically have much more competitive odds on soccer match odds (in the most well-liked leagues), both teams to score, and other comparable, popular mainstream markets at quite low-number odds.

Commission’s Effect on Exchange Odds

As indicated, the exchange commission was subtracted from the odds in our table above at a rate of 5% to provide you with effective odds and enable a fair comparison. The table below elaborates on this by demonstrating the effects of a 5% commission and a separate 3% fee on a variety of odds.

Liquidity Issues Could Exist

Any market that a fixed-odds sportsbook offers will enable a consumer to stake a respectable amount (provided they are not constrained for any other reason). For most consumers, the majority of the time, gambling as much as they want will not cause an issue. At certain sites, the maximum amount you can wager will be made obvious once you try to make a bet. On the other hand, at an exchange, you can only place a wager if there is accessible liquidity.

Money that is readily available at an exchange for a certain wager or market is referred to as having “liquidity”. There has to be someone willing to stake the same wager so as for one individual to put down a back bet. A shortage of liquidity can have a significant negative influence on your ability to place wagers at the exchange on less well-known markets, less popular sports, and less significant matches, games, or tournaments.

Fictitious Case

Consider that the greatest odds are almost $10,000 to support Manchester City in a soccer Premier League matchup against Fulham. The overwhelming majority of players have no liquidity in the considerably smaller anytime assist market on the same game, in comparison. Cole Palmer is one athlete who does have money ready to back him, but his odds are only 4.0. You can back the up-and-coming “Citizen” at a price of 4.5 at the fixed odds sister site of the same exchange.

There are three connected issues that gamblers deal with when there is low liquidity. In the beginning, they might not even be able to put their wager. Second, they might not be able to wager as much as they would like, and third, the odds might not be good because no one else is trying to make the bet; instead, they are doing so at odds that are higher than those at which they know they can back the same bet elsewhere.

The fact that liquidity is typically more constrained by the kind of outsiders who can give the highest pricing at the exchange may serve to further exacerbate this problem for supporters of exchanges. Although a lot will rely on how specialized your sporting wagers are, it is undeniable that a lack of liquidity occasionally leaves the exchanges wanting.

Exchanges Are Bad for Builders and Accas

When it concerns more complicated bets with many propositions, exchanges may not always present the greatest alternative. Without much success, exchanges have experimented with offering accumulators and other related bets. Even if there are only a few pre-selected accas available, an exchange is most definitely not the place to attempt to place this type of wager if you frequently enjoy doing so.

Additionally, you will not be able to place bets using the increasingly popular bet builder technique on the exchange. If that is your preferred wager, fixed odds are essentially the only way to go. However, if you only intend to back up to three distinct wagers, like the match outcome and over 2.5 goals, an exchange might have possibilities for you.

Bookies Typically Offer More

Last but not least, it is important to keep in mind that fixed-odds bookies may have extra to offer even if the odds themselves do not exactly measure up for a savvy gambler who views value and the bottom line as the ultimate yardstick of a website’s worth. This is because the exchange model lends itself less effectively to providing free bets and promos due to the narrow margins and wagers placed between players.

The bookie may offer a faster payout incentive if the team scores two goals, even though the exchange might offer greater odds of a specific team winning a football match. Or perhaps they pay out if they happen to be ahead with a little time left. In the improbable event that a team blows a two-goal advantage or the opposition scores a last-minute equalizer, your wager would lose at the exchange but win at the bookmaker. More favorable odds are useless if you do not win, and a single full payout would make up for the many instances in which the exchange provided just slightly superior prices.

Simply put, the greatest fixed-odds bookies provide more promos than the best exchanges, whether it be for money back, odds boosting, early payouts, or anything else. It is difficult to calculate if this is worth more than any odds superiority, but on any particular wager, the most devoted bettors should take into account the entire package being provided by both possibilities.

Other articles from totimes.ca – otttimes.ca – mtltimes.ca