I’m not going to say emphatically that there’s no way of earning a living on the betting exchanges, I’d be a fool to say that and it would look like sour grapes because I’d failed to make any money. No, I wouldn’t say it is impossible to earn a living on the betting exchanges, but over 5 years I went from thinking it looked too easy to financial meltdown and depression. I just wish I could have found an article like this, but in those days the betting exchange concept was new and nobody had any substantial experience to share with others. All there seemed to be was a barrage of systems and tipsters telling us that now we could all be like the bookies…and had you ever seen a poor bookmaker?
It took me a while to grasp the concept of the betting exchange; well to be honest I was completely new to mega888. I’d never gambled money, not even slot machines. It just didn’t interest me. I remember as a child spending a lot of time in working men’s clubs where I’d practise with a brass band, often up to 4 times a week. In those days it was only private clubs that could have the big payout machines. I used to see mostly the same people week after week pushing a fortune into the damn things. It just seemed crazy to me. However, many years later I got to know a professional “slotter” who lived in a new house, owned a new BMW and had no debt all through playing slot machines! The difference was, though, that he was working to a carefully worked out formula and only playing on particular machines that met certain strict criteria. He also worked hard at it, travelling the length and breadth of the country looking for the right machines and when he found them fearing for his health and safety as he went about his work. You’re not entirely welcome when you suddenly appear in a local community pub and empty the fruit machine of all their money!
I realised at this early stage though that I needed to work systematically to a formula and only bet when my strict criteria was met. I was looking for a small niche that I could exploit. I’d then have my own cash-making machine that I could switch on and off as I chose. Earning a living on the betting exchanges is such an attractive idea. From the comfort of you own home, or anywhere else with Internet and a laptop, you can quietly and simply make a lot of money and it’s tax-free. I’d previously looked into and had indeed tried many other business opportunities like MLM, running a vitamin and mineral website, promoting holidays etc. and they all seemed, by comparison, so laborious. Not only having to pay for advertising, submit to all the search engines and directories, but also to pack stuff up and sent it out to people.
The betting exchanges do seem the fairer gambling option (if you’re familiar with them then skip to the next paragraph). The exchange matches up a backer with a layer, someone who thinks a horse will win with someone who thinks it won’t. The market agrees the price on a pure and simple supply and demand basis. If a horse looks like it’s a good winning bet there won’t be so many people prepared to oppose it, this means the backer will have to take what price they can get, which will be low. However, some layers are still prepared to offer the backer a bit more, they’re so desperate to get their bet matched up. But their money is quickly gobbled up and then backers have to be prepared to take lower prices again. Mind you, if the horse then starts to display worrying signs down at the start I.e. it’s sweating up, or won’t go into the stalls or, even worse, runs off delaying the race and wasting precious energy. All of a sudden it’s not such a sure fire bet and new backers will demand better prices from the layers, who will certainly oblige now they’re even more convinced that the horse will lose. The price starts to drifts out. Incidentally, the opposite of drifting out is steaming in; this is exactly the same but in reverse. What’s in it for the betting exchange? Well the exchange takes a commission on the winning outcome. So if you’re the layer and the horse loses you take the backers stake minus the betting exchange commission, if the horse wins the race the layer pays out to the backer and the backer’s account is debited for the commission. The commission works on a set percentage of the winnings, so the exchange make more when the horse wins, but because the exchange gets paid something whatever the outcome they’re not bothered if you’re too successful. You’re not going to get your account closed unless the exchange spot suspicious patterns of betting which could indicate something more serious.
It’s widely acknowledged that the sensible money is on the exchanges. If you check back over time, the chance of a horse winning as expressed by its odds and the actual outcome of the race is pretty much the same. It is a very efficient market. I’m referring to just horse racing here, but it’s probably the same right across all the sporting events available on the exchanges. So if the horse goes off at 4/1 shown as 5 on the exchange, over time you’d expect 100/5 of them to win, or you’d expect a win 20% of the time. Don’t make the easy mistake though of thinking that because the price is high you stand more chance of being successful as a layer; remember the market is very efficient. You may have a killer week and clean up, but there will be a correction and, taking the commission into account, you’ll probably end up out of pocket.
I’ve just touched on one of the big problems when laying horses. It’s the psychology problem. When you lay it’s an odds on bet most of the time and you only get the backers stake minus commission. If you have a brilliant week or month and hardly suffer any horses winning or probably none, you can start beating yourself up for not being a bit braver and putting more money on, or, even worse, you scrap your staking plan and replace it with a far riskier one. After all, you’ve just realised that had you spent the last month staking higher you would have filled your boots! You may also feel like you’ve cracked the money thing, you are a master of the universe. I’d never earned money this quickly before, I earned £1600 in 4 days at the start! Naturally you start spending more, as your respect for money starts to dwindle. I mean, hey, I’ve sussed this out; I don’t ever have to worry about money again. I am a betting exchange maverick now. You’ll probably even get friends and family involved and they’ll probably do exactly the same as you! But then…
…Oh dear…Now don’t feel too foolish, aren’t we basically seeing the results of exactly the same type of behaviour from our major banks at present. They had the same departure from reality; you see few people are immune to it.
The correction comes and when it’s laying horses it’s as dramatic as the recent stock market plunges. You can lose months of hard earned winnings in a few bad days, or even on one very bad day. What compounds the problem is that you lose your nerve so you cut your stakes right back, which prevents you from making as much back as you should. You now try to correct this by upping your stakes again, but, oh no…they all start winning again! Now any strategy you had has gone out the window as you grab for the next credit card in desperation. You feel physically sick as your dream of a new life evaporates and a life of serious debt replaces it. You go out and spend a few hundred on a laying system from some exchange “guru” but it’s no good after a few weeks work the same thing happens again!
The emotional effect of this, the strain it places on your family and health is like nothing else I have ever experienced. You know the right system is out there, but are you going to be broke or institutionalised before you find it? And the worse thing is you may have spent hours a day for many years working your socks off trying to find the right strategy, but people will just think you’re an irresponsible problem gambler. You feel utterly damned…”what have I done to deserve this thrashing?” etc…
Well you’ve done nothing wrong, nothing more than most people would’ve done in your situation. The problem is if you don’t show a bit of entrepreneurial spirit you know you’ll never stand a chance of a better standard of living, but it’s unlikely that the very first big project will succeed. Probably best to leave everything entrepreneurial for a few months, re-establish your health and well-being and then look for something else. And, sure enough, all the experiences you’ve had will help you to recognise the right thing when it does come along. Although I’ve taking a ravaging from my trading experience there’s part of me that respects the fact that I had the courage to try it and I can certainly talk about the whole gambling idea with a degree of authority.
So, I’d say it is possible to earn a living on the betting exchanges, but I hope you’re getting an idea now that it’s not quite as easy as it’s sometimes hyped up to be and there are many other legitimate and ingenious ways of making money from home.