What is sports spread betting and how does it compare to trading? We talk to Andy MacKenzie from Spreadex to find out

If you are new to sports spread betting watch our video with Spreadex sports and discover how sports spread betting differs from fixed odds and betting exchanges.

Welcome to Good Money Guide TV. Today, we’re going to talk to Andy MacKenzie from Spreadex about sports spread betting, which is one of my favourite ways to bet on the sports market. So Andy, good morning, welcome. Thanks for joining us.

Thanks Richard. Nice to be here.

So you’re from Spreadex, which, as well as a sports spread betting bookie, you’re also a financial spread betting broker as well.

Yep. So we do financial spread betting, we do sports fixed odds betting and casino betting as well.

Okay. So for those who aren’t familiar with sports spread betting and how it differs from traditional betting and traditional betting on sports, we’re just going to go through what sports spread betting is, the benefits, the risks, how it differs from traditional bookmakers, how it compares to betting exchanges, and also, you know, the major markets to bet on, and the major bets within those markets as well. So if you just want to quickly explain to us what sports spread betting is.

Yeah. So it’s a different way of betting on sport than your traditional fixed odds betting. It’s been around for more than 20 years but not known about by that many people. So how it works is Spreadex will give a spread or a prediction of something happening in a match or an event or a horse match. That could be number of goals in a football match, the winning distance of a horse in a horse race, the number of batsman runs in a cricket match. So you can look at all these spreads and you can use your judgement there. You can say, right, I think this batsman’s going to score more runs than the prediction there. So you might buy on the spread. Or you think actually, they’re not going to do as well as Spreadex think, and you can sell on the spread. And you win the difference in your bet. So the multiple of your stake. So that basically, the more right you are, the more you can win.

It goes the other way as well. So if the bet goes against you, the more wrong you are, the more you can lose. So that’s what you need to bear in mind.

Okay. So that’s how it differs traditionally from normal fixed odd betting.

That’s right. So rather than just looking at the final results or outcome, you can bet on different aspects of a match or a race or you can bet over a whole season. So there’s different ways of betting in different lengths.

I mean the main thing to kind of think about, yeah, you’re right, is that so many markets you can look at to bet how you think an event might happen. So a good example would be total goal minutes on a football match, which is the minutes the goals are scored all added up in a game. So if you think there’s going to be lots of late goals in a game, you might look at a total goal minute spread of 134 to 144. Now we’ve seen that a lot in the Premier League, lots of late goals. The market can easily settle at over 300. So if you’ve bought at 144, you know, you’ve won over 150 times your stake. But you have to realise if the match ends nil-nil, you could lose 144 times your stake, if that market makes zero. So this is the important distinction to think about.

Yeah, and that’s a big difference actually. There are significant benefits over traditional gambling where the more right you are, you more you win. And the inverse is true; the more wrong you are, you more you lose. So do you want to just quickly talk us through the major benefits and the major risks?

Yeah, certainly. So I mean in-play betting, sports spread betting is where in-play came from. I know it’s been around for quite a while on fixed odds, but it’s so easy to get in and out of your bets. You know, you can [clear these] bets out quickly. You can go one way or you can go the other way. So that’s a major benefit. I think the way that you’ve got to think about it is say you had a fixed odds bet and you put a £10 bet, £25 bet, £50 bet down, that’s the amount of money that you’re risking, so you can’t lose any more than that, and you’ll have a set amount of money that you’re going to get back on your fixed odds bet, so you know what you’re going to try and win. With spread betting, it’s a little bit more open-ended. So you put a £50 bet down and it could win lots more, depending how the market makes up or a lot less.

So if you look at an example of football betting, match odds, let’s say. So Chelsea away at Manchester City. Manchester City, very short price favourites, 2-5 on the fixed odds. And if you look at the equivalent on sports spread betting, it’s a supremacy bet. So this is where Spreadex predicts the number of goals, one team’s better than another team. So here, Manchester City would be 1.3 to 1.5 over Chelsea, which means our traders think they’re basically a goal and a half better than Chelsea. So if you put a £50 on the 2-5 on the fixed odds and Manchester City win, you win £20 profit, plus your stake. If you have a spread bet and you put a £50 bet on and you’re buying on this 1.5 spread of goals, you need Manchester City to win by two goals to start making money. If they win by two goals, you’ve made 0.5 of your £50 stake, so you’ve made £25. But the beauty then is if they win, which City often do, 3-nil, 4-nil, whatever the score might be, you’re making £50 every extra goal. So if they win by three goals, you’re making £75, £125. So that’s the difference, where you get a bet right, you can start making money. But also, you’ve got to think, if you get it wrong and City only win by a goal, you’ve then lost half of your £25. If it’s a draw, you lose £75. So that’s the major way of thinking about the difference.

Can that market have a negative result as well, so if it goes completely the other way?

Exactly. So if you’re looking at a 1.3 to 1.5 Manchester City supremacy, if Chelsea win the game, you’ve bought at 1.5, the market could make up at minus 1.5 if Chelsea win by a goal, so you’ve actually lost two and a half times your stake. So that’s the kind of thing you have to think about.

And it works the inverse as well, of course, if you want to back the underdog as well, you can sell the market.

Yeah. And this is another great example. So horse racing is a good example here. In fixed odds, you might have a favourite that 5-2 favourite, for example. With horse racing, you have a race index. So this could be a 50, 30, 20, 10 market where the winner gets 50 points, second place gets 30, third place gets 20, fourth place gets 10. Here, you get a spread. So the spread might be… we were looking actually at Wolverhampton yesterday, the 3:50. The favourite was Ingleby Mackenzie, which is no relation, by the way. But that was a 5-2 favourite. The spread there was 21 to 24. So if you didn’t fancy the favourite here and you wanted to sell – this is the beauty of spread betting, you can guess against the favourite – you could actually sell at 21 and if the horse finishes outside the top four, you’re going to make 21 times your stake, and actually, that did happen on this particular race. The thing to remember there, so you know, £1 would’ve made 24 times your stake; £10, £240 etc. But if the horse had won the race and made 50 points, you would’ve lost 29 times your stake. If it had finished second and 30 points, you would’ve lost nine your stake and so on. So it’s a good way of, you know, if you don’t fancy a favourite or if you think you fancy a horse to place that’s very, very low on the spreads, there’s lots of options there to think about.

I have to say, in horse racing, my favourite bet is the winning distances, first and second. We always do that. We generally only bet when we’re at the races and we find that because you’re there for the whole meet, having that longer term index bet throughout the day, it means you’re always—

That’s it, you have a long-term interest over the whole meet.

Yeah. And you’re cheering for the winner in the race. It doesn’t matter who wins, as long as the winner wins by more.

Yeah. So you can bet on the distances of the first to second horse, second to third horse. You can start betting on the numbers, you know, the actual race card numbers of the horses, you know, the double numbers, so every race that the horse wins, double that number to add it all up. You can bet on the favourites market. So 50 points every time a favourite wins or 25 if they come second.

How does that generally work out, the favourites index? I’ve always been fascinated.

You can bet on the number of favourites. So yeah, you know, you go down to Cheltenham and you have some days where there’s three or four favourites coming in, and if you bet on that favourites market, you know, earn 50 points every time the favourite comes in, generally, if you bought on that, you’d do well. But obviously, other days, there’s no favourites, the winner in the race. You know, it’s one of those things. But again, lots of different ways to bet over that, and you can even bet on the jockeys. You know, you can bet on the performance of the jockeys over the race as well.

So when Frankie’s running, back Frankie and Johnson.

If you’ve got a favourite jockey, or forget about whatever happens, you can bet on just two horses in a race and have a match bet about whether that horse will beat the other horse and what distance it will beat it by. So again, lots of different elements for you to bet.

The other one we quite like is… I think you’re the only ones that do it actually, I don’t think your competitors do, is the heads you win bet as well. We like that on sprint racing. You know, the closer the two winners are, the more you win. We had one bet on where there were two dead heats in a race. We did quite well.

I mean there are so many bets that I probably don’t even know them all myself.

We’ll go through some of the most popular ones in a minute. But one of the things you touched on earlier was your ability to lay a horse, so you can bet on someone not winning. And of course, the other way to do that is through a betting exchange. But if you’re primarily a sports trader, which we’ll say is the type of customer that will be doing this, but you know, betting in-play has a slightly more sophisticated attitude to gambling and what’s the bet on events happening or not happening, how do you say… I mean what’s the major advantage of say laying bets through a sports spread bet, rather than doing it on an exchange?

So with an exchange, it’s similar but a little bit different. So with an exchange, yes, you know, you’re trying to look so your bet’s being matched against someone else who has the opposite view to you. So on this example of a horse race, you back a horse, you think it’s going to win. You lay if you think it won’t win. You know, the opposite of it happening. And you’re trying to get that bet match and you’re looking for someone else in the market to do it. With Spreadex, you’re not betting against someone else; you’re betting against Spreadex. So the spread there, as we’ve just spoken about before, is the Spreadex prediction. So rather than someone else taking the risk, Spreadex are taking the risk here and you don’t have to look to be matched. You can just sell on the spread basically.

So with betting exchanges, obviously, you’re either facing another punter or if it’s a thin market, there’ll be some market makers in there as well. So how do you come up with your pricing? Is that your traders sat on a desk coming up with the pricing or do you buy data in?

Everything is all priced ourselves, so we have a big team of traders. As you can imagine, it’s a very stringent interview process. They have to be very analytical, you know, very, very mathematical. And you’ve got to know your sport inside out. So you’ve got to be, in your planning and preparation and your research ahead of an event, there are many, many different things to bear in mind. You know, obviously, the form guides, the size of the bets that are coming in, injury news, weather. All these sorts of things can affect lots of things. So the traders will come in, they’ll price up all these hundreds of different markets. And then watching a trader do a match in-play is a sight to behold, because there’s so many bets coming in and so many things to keep an eye on. All this is in-play, live pricing that they’ve got to change the whole time. But for the punter, there’s so many opportunities to come in and look at different things that are happening in a game. You might think this game’s boiling up, there’s going to be loads of bookings here, and you go onto the bookings markets, or there might be a winger that keeps winning corners and you want to buy corners. So again, lots of different ways.

So on that, so obviously, your traders are pricing up markets in-play, do you still get a lot of phone trading? Do you still have punters phoning up on the phone? Is it all mobile now? Is there an element of your customer that like the old school interaction?

Yeah. I think the demographic of a spread better is perhaps slightly older than the fixed odds punter. So maybe a more kind of experienced person who’s watched a lot of sport. They have a lot of experience of betting and they know all these different kind of ways that they might want to put a bet on. And some of the older demographic – we’re not talking massively old here by all means – they might still like the traditional phone in to place a bet. But I must say that we have platforms now for desktop, for tablet, for phone, be it Android or iOS, dedicated, designed platforms that make it so quick and easy to go in, place your bets. So we know see far more people betting on mobile when you’re out and about at an event.

Do you develop that all in-house?

All built in-house, yep, and we’re constantly changing it on feedback from clients who like to have quicker ways of getting to their bets, favourite bets that they like to place. Statistics, we have a lot of statistics now that we put out onto the app, to give you pre-match hints and tips of average make-ups of what teams have been in previous games. Also, horse races, what the form guide is like. So that’s all available at the touch of a button. And as a punter, you know, it’s really good to have that information to hand, to see before you’re placing your bets.

And do you see much of a crossover from… you know, obviously a lot of financial spread betting brokers used to offer sports spread betting; at one point, quite a few of them did, but they’ve sort of gradually moved away from it. You’re the only guys that offer now financial spread betting and sport spread betting. So do you see a lot of the financial traders during the week move onto the sports platform over the weekend, or is there not much of a crossover?

There is a crossover. You know, it’s not that everyone does the financial and then the sport. And people like to have different sports that they bet on. So you know, when the Ashes comes around, lots of people, obviously, the talk in the office will be on the Ashes, the Rugby World Cup, Six Nations, Boat Race even. You know, there’s lots of different things that come around at different times of year. So we will see people who love to have a bet on certain sports. They might want to do the financial trading. They might be looking at the FTSE, you know, in the week, and then go and look at the footie at the weekend.

But yeah, I mean Spreadex, we’ve been around for 20 years and we did start up sport spread betting and financial spread betting back in 1999. Added on fixed odds betting ten years ago. And like you say, we’ve had… so 2011, we took over the IG index sports betting arm, which was Extra Bet. So that helped us to grow. And we’ve had further acquisitions since then with Cantor Index, the non-equities business of them, MF Global. So we’ve had quite a lot of growth, and so yeah, we do see a little bit of crossover with the financial clients as well.

That’s interesting. So of all the sports you cover, what are the top ten sports that people tend to trade?

As we mentioned, there’s so many markets, we could sit here for hours and talk about it all, but I’ll try and be brief. Football is the most popular by far, and so many different ways of betting of football, like we’ve mentioned. If you want to look at bookings, if you want to look at corners, if you want to look at the time of the first match goal. You can bet on the team performance or the match performance. You know, certain things happening in a game. Player goal minutes is a really popular one, so you can pick players and then every time they score, you add up the minutes that they score in. Shirt numbers, you know, the aggregate number of the shirts, of the goal scorers.

I used to like betting on corner minutes. The first corner minute.

Or you can do cross corners or multi corners, which is like first half corners multiplied by second half corners or the home team corners multiplied by the away team corners. You know, there’s so many different markets. If you’ve got a certain way that you like to bet and you’ve not looked at spread betting, it’s probably worth having a look, just going onto the app and just seeing what the range of markets are there.

There’s a good point actually. On that, a lot of people I think are probably put off by sports spread betting. I mean I’ve had an account with you for 20 years, but you know, 20 years ago, I had a financial trading background as well, so I sort of understood the concept of how sports spread betting worked and how to trade a market. But for those people who want to get into it, how should they learn about it?

So if you go to the Spreadex and under the Get Started section, there’s a whole series of educational pages and videos. But you’re right, it can seem quite daunting, but if you’re into a particular sport, tennis, for example, or snooker or whatever it might be, the way to do it is go and have a look at the resources available online, check out how the markets work, and then I always say paper trade first of all, before you do it. So literally just write down the bet that you’re looking at, see how the market made up, see how much you would’ve staked and see how much you would’ve won or lost. And it’s a good safe way of doing it. Because the markets are very different. Some of them are very volatile and will move a lot. Like the total goal minutes that we spoke about earlier. Whereas total goals in a game is going to be far less volatile, so you can stake accordingly. But I mean there’s Spreadex videos on YouTube, there’s lots of videos that explain how the markets work. We’ve even got an interactive widget. Everyone loves an interactive widget, which will allow you to put prices on theoretical bets, move a slider to show how much you would’ve won or lost. So before you completely go for it and get stuck in, have a look around, make sure you understand how the markets work. And also, if you’re going to bet on a game or an event, make sure you can kind of watch it so you can do it in-play, so you can see that you can close out. We have auto close out features to cash out at given levels. So there’s lots of tools in there to help you.

I remember that. I used that limit order on the darts one. I didn’t quite get hit. Completely reversed.

Should’ve set it a bit lower.

Yeah. Any external resources you’d recommend, other than Spreadex? Any good books on understanding sport spread betting theory?

I’m sure there’s psychological books out there that have been written. We haven’t written our own books on that. We just have our online resources. You’ll find kind of affiliate websites, which will give their own tips on it as well. You know, they might have different ways of looking at how to bet on these different markets. Cricket is famously linked from financial spread betting, because the way that the runs move are almost a bit like how a market moves. So that’s a great way of kind of like having a look at… you know, next time the England test match, have a look at the Spreadex app and just look at how the prices move and when there’s a wicket, they’ll drop down again. So sometimes, even just looking at how the markets move and the prices is as good a way as any of trying to learn how it works.

So is there anything else that Spreadex does that is unique in the industry and sets Spreadex apart from others within the landscape?

So I think a lot of bookmakers, they won’t allow you to bet on credit, and Spreadex is one of the few bookmakers that will allow you to apply for a credit limit, interest free credit limit. It’s obviously subject to client status, but this gives you a little bit more flexibility that you don’t have to first fund your account or fund your account as much to place your bet. So it gives you a little bit of leeway if you have a few losses but then a few wins, and your balance is moving around. That gives you a bit more kind of flexibility in your betting.

Do you have to do that because of potential winnings and losses anyway?

That’s right. I mean sometimes, you will have to have a certain amount of money in your account to cover certain positions that you want to take up. So that gives you a bit more flexibility.

Essentially betting on leverage.

Yeah, effectively it is, yeah. But there’s lots of other things. Bet builder markets where you can actually choose your different kind of like spreads that you want to add together and give yourself a number of different ways of betting. There’s livestreaming on a lot of events now you can get through Spreadex and on your app. And lots of kind of different match centres that will show you what’s going on if you can’t actually get to watch a game or you haven’t got a stream on it, showing you where the action is and what’s going on. And as we mentioned before, lots and lots of betting statistics, which people love, to try and give you an edge.

And all this of course available on your website. For free or do you have to have an account?

No, if you haven’t got an account, you can actually see all the prices, all the markets. You can see all the statistics as well. Which is why we do suggest sometimes just go onto the site, look at how the prices move. When there’s a live match on, put the match centres up and just see all the prices moving in action and it’ll give you a real idea of how spread betting works.

Right. Well excellent. Andy, thank you very much for coming in and telling us about sports spread betting.

It’s been great. Thanks for inviting me.

No, it’s nice to see you again as well. Thank you very much for watching the last Good Money Guide TV. We’ll be back shortly with something else.

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