Betfair Exchange Glossary

The Betfair API is a programming interface that allows third-party software to connect to Betfair's markets, retrieve live price data, and place bets programmatically. All major trading software (Bet Angel, Geeks Toy, etc.) connects via the API to provide faster data and one-click execution. See Betfair API guide.

Placing bets on all outcomes of an event across different bookmakers or exchanges to guarantee a profit regardless of the result, exploiting differing odds. Arbing on the Exchange typically involves backing on a traditional bookmaker at higher odds and laying on Betfair at lower odds. Bookmakers quickly restrict accounts of known arbers; the Exchange is more tolerant.

The amounts currently available to be matched at each price point on the ladder. "Available to back" shows how much money is sitting as unmatched lay orders (waiting to be backed against). "Available to lay" shows unmatched back orders. This data forms the basis of weight-of-money analysis. See how to read the Betfair market.

A bet that a specific outcome will happen. If it does, you win (odds − 1) × stake. If it doesn't, you lose your stake. The same as a traditional bookmaker bet. On the Betfair interface, back bets are shown in blue. See back betting explained.

The total amount of money you have set aside specifically for Betfair trading. Not your total life savings — only money you can afford to lose entirely. Good bankroll management means never risking more than 1–5% of your bankroll on a single trade. See bankroll management guide.

A peer-to-peer betting marketplace where users bet against each other rather than against a bookmaker. Betfair matches back bets (bets that something will happen) against lay bets (bets that it won't happen). Betfair takes commission on net winnings from the winning side. Odds are determined by market supply and demand. See how the exchange works.

A computer-generated price calculated at the moment a race starts by matching all remaining unmatched back and lay bets. BSP is generally close to the final traded price but not identical. Used by traders and bettors who want to be matched at a fair market price without monitoring the market manually. See BSP explained.

Betfair's built-in feature that allows you to settle a bet for its current market value before the event ends. The cash-out amount changes as the market price moves. Accepts a lower guaranteed return in exchange for removing the risk of the final result. Professional traders typically green up manually or use software rather than the standard cash-out button, for greater control.

Betfair's fee on net winnings in each market. Standard rates: 2% on horse racing (UK/Ireland), 5% on most other sports. Only charged when you win — losing bets incur no commission. Your effective rate can reduce through loyalty programmes. Commission must be factored into every trade's P&L calculation. See commission explained.

When a selection's odds move higher (longer). "The favourite has drifted from 2.00 to 2.30" means the market is backing it less — often indicating something negative (injury news, market intelligence, weight-of-money shift). Traders who back before the drift and lay after capture the movement as profit.

Backing multiple selections in the same market with proportional stakes so that you make the same profit whichever of those selections wins. Useful when you think the winner is in a group of selections but you're not sure which one. The profit is lower than backing just one winner correctly, but the strike rate is higher. See dutching on Betfair.

A two-part bet: half the stake backs the selection to win, half backs it to place (usually top 3–4 depending on field size). The Exchange has dedicated Each Way markets for horse racing. On the Exchange, the place part is settled at 1/4 or 1/5 of the win odds depending on the race type and field size.

The selection with the lowest odds in a market — the one the market considers most likely to win. In horse racing, trading the favourite is one of the most common strategies because favourites have the most liquidity and the most predictable price movement patterns. See trading the favourite.

Distributing a profit across all outcomes in a market so that you make money regardless of the result. After a successful trade, profit shows on one selection; greening up hedges the other selections to show the same positive return everywhere. On Betfair's interface, positive P&L displays in green — hence the term. See green up explained.

Placing a bet on the opposite side to a previous bet to reduce or eliminate risk. In trading, this means backing after you've laid, or laying after you've backed. A full hedge eliminates all risk; a partial hedge reduces it. The green-up process is a form of hedging. See hedging on Betfair.

Betting or trading on markets that are active during the event (while the race is running, the match is being played, the set is in progress). In-play markets have much faster price movements and greater volatility than pre-event markets. Requires fast execution — software is essential for in-play trading on most sports. See in-play trading strategies.

The primary interface for active trading — a vertical display of all price levels in a market, showing available amounts to back and lay at each price, and your pending orders. One-click trading on the ladder is essential for fast pre-race and in-play trading. The standard Betfair website has no ladder view; all major trading software provides one.

A bet that a specific outcome will NOT happen. You act as the bookmaker — you collect the backer's stake if wrong, but pay out their winnings if right. Your maximum liability = (odds − 1) × matched stake. On Betfair's interface, lay bets are shown in pink. See lay betting explained.

A football strategy that involves laying the draw before kick-off and trading out (backing the draw) once a goal is scored — at which point the draw price has lengthened significantly, producing a profit. Considered one of the most teachable structured trading strategies. Has high liquidity in top-flight matches. See Lay the Draw strategy guide.

The maximum amount you stand to lose on a lay bet if the selection wins. Calculated as (odds − 1) × matched stake. Betfair reserves your full liability in your account when a lay bet is placed, so you must have sufficient funds. Higher-odds lays carry much larger liabilities for the same stake — a £10 lay at 20.00 carries £190 liability.

The total money available to be matched in a market. High liquidity means large orders can be placed and exited quickly at stable prices. Low liquidity means thin markets where large orders move the price significantly. UK horse racing, Premier League football, and Grand Slam tennis have the highest liquidity on Betfair. See how the exchange works.

The standard commission rate for a specific market, set by Betfair. The MBR is the starting point before any loyalty discounts are applied. It varies by market type — UK horse racing has a lower MBR than most sports. Your effective commission rate is: MBR × (1 − your loyalty discount).

A technique that uses free bets from bookmakers, combined with laying the same selection on the Exchange, to produce a near-guaranteed profit regardless of the outcome. Not the same as trading — it's a technique for extracting value from promotional offers. See matched betting guide.

A bet is matched when Betfair has found the other side — a backer for your lay, or a layer for your back. An unmatched bet is sitting in the queue waiting to be filled. Unmatched bets can be cancelled. At race start, all remaining unmatched orders can be matched at BSP or cancelled depending on your settings.

Betfair Exchange uses decimal odds exclusively (not fractions). Decimal odds represent your total return per £1 staked including your stake back. Odds of 3.00 = £2 profit + £1 stake return per £1 bet. To calculate profit: (odds − 1) × stake. To convert: decimal to fractional — subtract 1 and convert to fraction (3.00 = 2/1). To convert UK fractional to decimal: divide numerator by denominator and add 1 (4/1 = 5.00).

The sum of all implied probabilities in a market. A perfectly balanced market = 100%. A market with overround = more than 100% = the house has an edge. Betfair Exchange markets typically have very low overround (often 100–102%) because Betfair only takes commission rather than building margin into the odds — unlike bookmakers who run at 110–120%.

Your net profit or loss across all trades in a session, day, week, or month. Always calculate P&L after commission — gross winnings are meaningless without accounting for Betfair's cut. Good traders track P&L obsessively. If you're not tracking it, you don't know whether you're actually profitable.

Trading on a market before the event begins. Horse racing pre-match markets open several days before the race; most activity happens in the 60–90 minutes before the off. Football pre-match markets open 24–48 hours before kick-off. Pre-match is slower and less volatile than in-play, making it better for learning. See pre-match trading strategies.

An additional levy on highly profitable customers who generate large profits relative to their commission payments. Applied weekly if your lifetime net profits exceed certain thresholds AND your commission payments represent less than 20% of gross profits. Affects fewer than 0.1% of users — exclusively full-time professionals. See premium charge explained.

The opposite of greening up — accepting a guaranteed small loss across all outcomes rather than risking a larger loss if the trade goes wrong. Sometimes the right call when a position is going against you and the expected loss from waiting is worse than the confirmed loss from exiting now. "Taking a red" is standard practice for disciplined traders.

A high-frequency trading style that aims to profit from very small price movements — typically 1–2 ticks — with high volume. Scalpers place and cancel hundreds of orders per session, taking tiny profits repeatedly. Requires fast software, strong discipline, and a high win rate to be profitable after commission. See scalping on Betfair.

Exiting a position at breakeven — no profit, no loss (before commission). Scratching a trade is the correct response when a trade isn't working but hasn't yet moved significantly against you. Scratching is far better than holding a losing position in hope. "When in doubt, scratch out."

Laying a selection first, expecting the odds to drift (lengthen), then backing it at the higher price to close the position for a profit. The Betfair equivalent of short-selling — you're selling (laying) something you expect to become cheaper, then buying (backing) at the lower price. Works in any market where odds are expected to move out.

When a selection's odds shorten rapidly — a lot of money coming in quickly. "The favourite is steaming" means large amounts of money are being backed, pushing the price down fast. Often indicates market intelligence, a well-placed tip, or a significant bettor taking a position. Following steam can be profitable but also dangerous if you're late.

A trading style that holds positions through larger price moves — backing when you expect odds to shorten significantly, or laying when you expect odds to drift significantly. Fewer trades than scalping, larger target profit per trade, longer holding time. More suitable for beginners than scalping because the target price movements are larger and the time pressure lower. See swing trading on Betfair.

The minimum price increment on the Betfair exchange. Tick size varies by price range: at odds of 1.01–2.00, one tick = 0.01. At 2.00–3.00, one tick = 0.02. At 3.00–4.00, one tick = 0.05. At 4.00–6.00, one tick = 0.10. At 6.00–10.00, one tick = 0.20. Understanding tick sizes is essential for calculating scalping profitability at different price points.

On Betfair, trading means placing both a back and a lay bet on the same selection to profit from price movement — regardless of the final result. Like financial market trading but using sports odds as the asset. See what is Betfair trading.

A selection is described as "value" when the market price is higher than its true probability of occurring. If you assess a horse's real chance of winning at 40% (implied odds 2.50) but the market is offering 3.20, that's value — the market is underestimating its chance. Consistently finding and backing value is the only sustainable long-term strategy.

The total amount of money matched in a market. Higher volume = higher liquidity = easier to place and exit large orders. Betfair displays total matched volume in each market header. Use it to screen out illiquid markets unsuitable for active trading.

An analysis of the balance between available back money and available lay money at the current best prices. If there's significantly more lay money than back money at the current price, it suggests the price is likely to shorten (steam). If there's more back money, the price may drift. WOM is one signal among many — it can be misleading in markets with heavy bot activity. See how to read the Betfair market.