Traditional betting is where you bet on the outcome of an event, such as Chelsea FC to win the Premier League. However, when you spread bet you are gambling on the margins of victory or loss. So instead of betting Chelsea to win the league outright, you actually bet on the total number of points by which you think Chelsea will win the league.
The ‘spread’ is set by the bookmaker usually on a points system such as the following:
- Winner = 60 points
- Runner-up = 40 points
- 3rd = 30 points
- 4th = 20 points
- 5th = 10 points
- 6th = 5 points
- All others = 0
So the Chelsea ‘spread’ is set by the bookmaker at 58 – 59 points. Remember these are not league points but an arbitrary 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.
If the team you follow are favorites to win the Premier League and you wanted to back them, you need to bet above the 58 – 59 spread. If you think they may fall apart in the latter stages of the season, then you bet under the 58-59 spread.
So how do you win money and how much?
Working Out Spread Betting Odds
This is when spread betting can get a little complicated. Let’s say Chelsea goes on to win the league, they will get awarded the maximum 60 points by the bookmakers spread system.
You have bet £10 above the spread so you would win £10! This is because you effectively bet £10 per point over 59 points so your maximum win could only be by 1pt.
Now let’s say that you had bet Chelsea ‘Under’ the spread of 58-59 points. Try very hard to imagine Chelsea losing 10 games on the trot and finishing 4th in the League. Based on the spread system, they would be awarded 20 points by the bookmakers for finishing in this position.
The difference between the original bookmakers spread at 58-59 points and the 20 points they ended up with is 38.
Take that 38 and multiply it by your original stake, which was £10. As a result, your £10 bet would net you £380.
The Downside Of Spread Betting
Of course, this type of betting can also work against you. Using the example above, had you bet ‘Over’ the 58-59, believing that Chelsea would romp home in top position then you would be liable to a substantial loss.
How? Take the 58-59 points that you originally bet on, take away the 20 points that they ended up on and you are left with 38. Unlike the outcome above, you now owe £380. This is opposed to just losing your £10 stake like you would in regular fixed odds betting.
Limiting Your Risk
Spread betting can be highly profitable, but it comes with a large element of risk. You could lose more than your original stake.
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 effects 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.