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What is Sports Spread Betting?- All you need to know (Beginners’ Guide)
Spread betting is of course betting, but not as you know it. You win more and lose less by how accurate you are, rather than just whether you were correct. If that sounds confusing do not worry because we go into it all in great detail below. This guide will explain what spread betting is, how to do it, so general advice and a heads up on pitfalls to look out for.
What is a spread bet?
A spread bet can be placed on any market with prices that change (for example oil, gold, etc) but for the purpose of this article we are going to look solely at sporting spread bets. A spread bet is a bet that you place where you predict if the market will settle higher or lower than the currently quoted spread. You then win “points” depending on how far out the final result is to where you bought or sold the bet. The total amount that you win or lose will be the stake amount per point multiplied by the number of points that you have won or lost.
Each time you see a market to bet on their will be two numbers, and if you think the result will be higher than quoted then you buy the higher number. If you think the result will finish lower then you sell the lower number. The small difference between these numbers if in effect the spread betting companies margin and how they make their money.
Is spread betting dangerous?
It is not dangerous but it does carry more risk than traditional betting and there are certain things you must fully appreciate. The first thing is that you will not know how much you will win or lose when you place the bet, because this amount will vary depending on how much your bet wins (how far the final result is from your buy or sell position). Also depending on what country you are based in, spread bet losses are legally binding which is not always the case with gambling debts.
How to place a spread bet
Placing a spread bet is a little more complex than placing a regular bet, and this is because of an extra step. Once you have decided what market you are going to bet on you must then select whether you think the result will be higher (in which case you buy) or lower (in which case you sell) than the spread. The full process is as follows:
- Log into your spread betting account
- Deposit enough funds to cover the worst case scenario of your bet
- Navigate to the relevant market that you want to bet on
- Select whether you are going to buy or sell the current price
- Enter the amount you wish to bet per point
- Submit the bet
How to work out the maximum amount that can be lost?
Assuming that the market is a win index on a football match, it is likely that the points available will be 0 if your team loses, 10 if it is a draw, and 25 if the team wins. The amount that you can buy or sell at will depend on if you are backing the favourite or the underdog, but assuming you are backing the favourite a possible spread would be 12.8 – 13. If we assume you back them, then you would buy at 13. The possible results are:
| Result | Points | Initial Position | Net Result |
|---|---|---|---|
| 🏆 Win | 25 | 13 | +12 (25 – 13) |
| 👥 Draw | 10 | 13 | -3 (10 – 13) |
| ❌ Lose | 0 | 13 | -13 (0 – 13) |
So in this example the maximum amount that you could lose would be 13 points. The actual amount of money you lose would be 13x the amount you have bet.
Obviously every bet will have a different opening amount and also every market will have different limits but to work out your maximum liability you always work out the difference between your bet and the market limit, and multiply it by your stake.
Is there a maximum amount that can be won?
Then to work out your maximum winnings you take the difference between your bet and the market limit and multiply it by your stake. In the following example we will bet on the total number of goals in a football match, and this time we do not think there will be many. The spread is 2.2 – 2.4 and so we sell at 2.2. The possible results are:
| Result (# of goals) | Points | Initial Position | Net Result |
|---|---|---|---|
| 8 goals | 8 | 2.2 | -5.8 (2.2 – 8) |
| 7 goals | 7 | 2.2 | -4.8 (2.2 – 7) |
| 6 goals | 6 | 2.2 | -3.8 (2.2 – 6) |
| 5 goals | 5 | 2.2 | -2.8 (2.2 – 5) |
| 4 goals | 4 | 2.2 | -1.8 (2.2 – 4) |
| 3 goals | 3 | 2.2 | -0.8 (2.2 – 3) |
| 2 goals | 2 | 2.2 | +0.2 (2.2 – 2) |
| 1 goal | 1 | 2.2 | +1.2 (2.2 – 1) |
| 0 goals | 0 | 2.2 | +2.2 (2.2 – 0) |
So in this example the maximum amount that you can win is 2.2 points, and the actual amount will be 2.2 multiplied by your stake amount. Note that here you can lose a lot more than you can win, but that is the trade off you get because winning something is more likely.
How is spread betting different to fixed odds betting?
Spread betting is different to fixed odds betting for a few reasons but the main one is that once you place your bet you will not know for sure how much you will win or lose, the amounts will depend on how far the result is from your prediction rather than just are you right or wrong. The other main difference is that all of the markets will have different settlement amounts, so you need to always be exactly sure what it is you are betting on, and it is generally more complex than placing a traditional fixed odds bet.
An example of a typical spread bet
We have already given two example above but we will look at another one now, which will be how many runs will be scored by a team in their first innings in a cricket match. Here the market will settle at whatever the total amount of runs are (the market has limits at 0 and 800). The spread is at 178 – 180 runs. The bet placed is for 2 per point. At the end of the 1st innings the total amount of runs scored was in fact 205. That means that:
| Bet Placed | Total Runs scored | Initial Positio | Win / Loss Points | Win / loss Money |
|---|---|---|---|---|
| 💰 Buy | 205 | 178 | +27 (205 – 178) | 54 (27 x 2) |
| 🪙 Sell | 205 | 180 | -25 (180 – 205) | -50 (25 x 2) |
So in this market you will have either won 54 or lost 50 depending on how you bet.
Remember to always gamble responsibly
Use any local charities that exist near you for help if you find yourself gambling with more than you can afford to lose or if it starts to effect your mental health in any way. If bookmakers have tools such as deposit limits, time out settings or self exclusion periods then make use of these as you see fit.
Conclusion
Spread betting is a very volatile form of betting, which can sometimes have wild swings that lead to big losses and big wins. It is more complicated than traditional betting and not something to enter into lightly. If you do decide to take part then we would advise you to start with very small stakes until you are confident in what you are doing and how the markets work. It is arguably a way of betting which adds a lot more fun when you are watching a game and winning, but it is not for beginners.
