What Is Spread Betting?

Most of us are familiar with regular fixed odds betting. That’s when a bookmaker offers specific odds on a match, or a race or a game. So in terms of horse racing, Tiger Roll was 5/1 to win the Grand National. That means for every £1 you bet on him, you would have received £5 back if he actually won it.

It’s simple. If you bet on a winner, you win. If you back a loser you lose.

The additional option for most of us is the each-way bet. This is where you place an extra wager on the ‘place’. So if you back Tiger Roll each-way, even if he doesn’t win, you could still get some money back if he finished 2nd, 3rd or 4th in the race.

Spread Betting is yet another way to place a wager but in a different way entirely.

What Is Spread Betting?

Imagine you follow a specific football team in the Premier League. You’re confident that they are going to have a great season and win the title. The bookmaker then creates a spread. It’s an arbitrary points system that has nothing to do with Premier League points. But it will look like the following:

• Winner = 60 points
• Runner-up = 40 points
• 3rd = 30 points
• 4th = 20 points
• 5th = 10 points
• 6th = 5 points
• All others = 0

It’s a way of gauging the likelihood of the chances of a team’s success. It’s done in the same way traditional odds represent a team’s chances of winning. So imagine the ‘spread’ for your team is set by the bookmaker at 58 – 59 points.

You think your team will win so you bet over the 58-59 spread. Of course, if you don’t think they will actually win the League you bet ‘under’ the 58 – 59 points spread.

Working Out Spread Betting Odds

This is when spread betting can get a little complicated. Let’s say your team goes on to win the league, they will get awarded the maximum 60 points by the bookmakers spread system.

So the points difference between ‘over 58-59’ and the 60 points allocated by the bookie is 1 point. For every 1 point over your correct bet, you get £10 back.

Now let’s say that you had bet your team ‘Under’ the spread of 58-59 points. They have a poor run and end up finishing in third place. Based on the spread system, they would be awarded 30 points by the bookmakers for finishing in this position.

The difference between the original bookmakers spread at 58-59 points and the 30 points they ended up with is 28.

Take that 28 and multiply it by your original stake, which was £10. As a result, your £10 bet would net you £280.

The Downside

Of course, this type of betting can also work against you. Using the example above, had you bet ‘Over’ the 58-59, believing that your team would romp home and win the title, then you would be liable to a substantial loss.

How? Take the 58-59 points that you originally bet on, take away the 30 points that they ended up on and you are left with 28. Unlike the outcome above, you now owe £280. This is opposed to just losing your £10 stake like you would in regular fixed odds betting.

Where Spread Betting Is Used

Spread betting can be highly profitable, but it comes with a large element of risk. You could lose more than your original stake.

Despite this, it is hugely popular and used a lot in football. You can bet on the spread of goals that will be scored in a game, all the way through to who will win the title. You even spread bet on the total goal minutes in a game.

So if a game ends up 1-1 and the first goal was scored in the 25th minute and the second goal was scored in the 56th minute then the total minutes will be 81. If the spread was set at between 126 -136 minutes and you bet ‘under’ – you win! If you bet over the spread – you lose.

There are ways to limit your risk as spread betting companies allow you a ‘Stop Loss’ option when placing a bet. This means you can set a limit on how much you could lose. This also affects how much you could win too.

When new to spread betting try to avoid betting on sports with large spread liabilities such as cricket games. Also, keep your stakes low. A £5 bet in the traditional bookmakers would not be considered a big bet but in spread betting a £5 bet could open you up to serious losses depending on the markets.