Spread Betting Guide

About 20 years ago, make-up, supremacy and mid-point were Greek to just about all British sports gamblers. Nevertheless, now they are well used terms in spread betting.

It's nearly 20 years since Jonathan Sparke, former boss of City Index, launched sports spread betting to the nation. Sparke was the founder of sports spread betting in this country - he instigated his new venture in 1986 and it was followed by Sporting Index six years later, in 1992, with IG Sport commencing in 1993.

Over the past six years, City Index has stopped providing sports spread markets, but other companies such as - Spreadex, Cantor Sport and Sports Spreads - have entered the sports spread betting merry-go-round.

Nevertheless, if you're new to spread betting, then you haven't necessarily missed out. If you have waited almost 20 years to open a spread account, it could prove to be a wise move. In the past, the chief criticism directed at spread betting firms was that they never made their product available to the average punter in the bookies. The spread betting game was aimed at the wealthy consisting of ex-City traders and those who could take the occasional big loss.

At last, the spread firms have reduced the minimum stakes. To appeal to a broader betting audience many have launched sister websites to accommodate smaller punters. Nowadays spread betting is a choice of punting that many previously unwilling to try it are taking up.

If you'd like to have a go at a spread bet but have never quite understood it, remember this: spread betting is the closest thing in gambling to Bruce Forsyth's Play Your Cards Right. You, the punter, face one question and the answer is: higher or lower? The more frequently you are right, the more you win; the more often you're wrong, the more you lose. Spreadbetting is exhilarating, it sure beats the straight win/lose scenario of fixed-odds betting.

Sports spread betting is divided into three groups:

1.) Total Bets
These are deliberated by the total number of times in a sporting event an eventuality happens, for instance corners in a football match, aces served in a tennis game, or runs is a test match.

Chelsea are set to play against Arsenal and the corners spread is fixed at 10-11 - this is the bookies' prediction of the number of corners there will be in the match.
You would like more than the price so you buy (higher) at 11.
You have been proved correct, because there are 14 corners.
You bought at 11, there were 14, so the difference is 3.
Profit at a £10 stake is 3x10=£30

2.) Supremacy and Match Bets
The main point of this bet is not necessarily that your teams wins, but by how many points.

England are playing Scotland in the Six Nations.
The bookmakers raise the price up at 46-50 - this is their prediction that England will beat Scotland by between 46 and 50 points.
You feel the game will be closer than the spread suggests so you sell (go lower) at 46. You still feel England will win, but the odds of 1/10 in the high street don't appeal.
Nevertheless, England are in sublime form and win 60-3.
You sold at 46, the result was 57 (the variance of 60 and 3), so you are 11 points 'wrong'.
Loss at a £10 stake is 11x10=-£110

3.) Performance and Index Bets
These markets will give point values to the winner, second place, third place and in some cases, down to eighth place in football, horseracing etc.

The majority of these types of examples are at horse race meetings every day. Spread firms offer a performance index on the favourites for the day and the jockeys competing.

They use the same method. Winner =25pts; runner-up =10pts; third =5pts. If there's a joint favourite, you are on the lowest racecard number.

Frankie Dettori is at Ascot and is in six races. The spread on his performances for the day is 46-50.
You believe he will get more points on the basis of the index scoring system than the spread suggests - you buy the spread at 50.
Dettori wins two race, is runner-up twice and is not placed with the remainder of his races. The winner;'s get 25 points each runners-up get 10. So the make-up (result) is 70.
You bought at 50 and the make-up was 70, so the difference is 20.
Profit at a £10 stake is 20x10 = £200

Fundamentally, this is how it works. It doesn't explain, though, what the advantages are for a punter. Why should you set up a spread betting account? The exhilaration - and risk - of big gains and losses is what appeals to many punters, nonetheless, this form of betting comes into its own when the favourite on the fixed odds markets are virtually unbackable.

If England have a game against Romania in rugby union, everybody knows England will win, but will they do so by between 98 and 102 points? In football, if England gets a game with the Faroe Islands, England are 1/10 to win the match, but will they win by five goals?

That is where spread betting offers punters better value for money. If you research your bets appropriately you can figure out when to buy and when to sell, It increases the interest to betting on an event where the winner is predictable.

Take note, more people buy than sell. The spread market makers are aware that there'll be a lot of buyers - in that, 65 per cent of the entire sports spread betters buy rather than sell - so on markets the spread is consistently inflated too high.

This knowledge should be acted upon.  It means that the markets veer towards people who sell. In horse racing if, for instance, you sell winning lengths at each meeting throughout the season you will make money (length is the difference between first and runner-up each race of a meeting). Additionally, if you sell corners in each live game in the Premiership this season you will make money. Sure, you will encounter the odd disaster but gambling is all about patience and the profits will roll in at the end of the season.

Better spread than dead
One more crucial rule in spread betting is to go against the norm. In the earlier rugby international example, practically everyone would want to bet on England beating Romania therefore, the spread on points supremacy goes from 98-102 to 106-110. The dealer feels the price is worth 102, but as the weight of money has seen it rise, this is the moment for you to step in and go against the trend by selling at 106.

In spread betting the in-running service is equally crucial.  The majority of firms provide betting when the event is in play, allowing you to take a profit or limit a loss at any time. For instance, you might want to buy corners before the game at 11-12, but if there are eight corners in the first-half, the spread will move to 15-16 at half-time. You can finish your bet by selling at 15 at half-time, thereby guaranteeing yourself a profit of three points.

The most important skill in-running is knowing when to get in and get out. This is a skill in itself, inasmuch as ever since betting exchanges were introduced a new form of gambler has emerged. People are not known as gamblers now. They have become traders. They get in and get out as soon as they can make their £100 profit.

High risk, high returns
This can't happen all the time so you must remember to cut your £100 loss when it goes against you as well. Spread betting is a high-risk style of gambling because for every big winner there is a big loser. When you put on a bet with a fixed-odds bookie you know exactly what you are going to win or lose but with spread betting it's not that straightforward. A £10 buy of the corners is not identical as a £10 buy of the runs in the test match - clearly, there will be many more runs in cricket than corners in football, so the volatility of the market is much greater.

Always check the volatility of the market or ask the trader what the stop-loss is, which limits what you win or lose: corners maintain a stop loss of 10, so a £10 buy is a £100 maximum bet. Cricket team runs maintain a stop-loss of 200, so a £10 buy is a £2,000 max bet. Spread betting is the most exciting style of gambling out there but be careful. Spread bets carry a high level of risk to your capital. Only gamble with monies that you can afford to lose. Never has a truer word been said.

How to get started
At this time, if you start up an account with Sporting Index, after five settled bets you will receive a £100 supremacy bet on a football match. After another five settled bets they will provide you with another £100 free supremacy bet on a football match. At IG Sport you will be given a £100 supremacy bet after five settled bets.

Did you know?
Unlike traditional high-street bookmakers, football matches gives spread firms its biggest revenue, taking more than a 60% share of the business. Horse racing comes in a distant second at about 20% but figures are reducing because of the rise in popularity of betting exchanges. Progressively, the popular sports are rugby union, rugby league and cricket in particular. There isn't any real reason why cricket is so popular - the most apparent theory is that of all the hundreds of markets spread firms offer it's the most simple to explain in terms of cricket. The spread on England's runs is 400-420. Will they play better? Buy at 420. Will they be worse? Sell at 400. Job done!