Smarkets.com: A Fairer Betting Exchange
Published on 02/09/16
If you take your gambling seriously, like a lot of us here do, you probably already know about betting exchanges. Betting exchanges differ from traditional bookmakers in that punters are not betting ‘against’ the bookie but rather against other punters. You can choose to set your own odds or take on someone else’s, and you can choose to either ‘back’ a team (or horse, or player, etc.) to win, or ‘lay’ a team, if you think it will lose. It’s basically the modern equivalent of going down the pub and asking if anyone would care to make a little wager on the football.
It’s usually best to use a mixture of betting exchanges and bookmakers to get the best odds and to spread your winnings around, but betting exchanges are starting to look more and more appealing to professional gamblers. Unlike bookmakers, betting exchanges don’t rely on you losing to make a profit, because they simply take a small cut of the winner’s earnings. This means that one of the biggest benefits of betting exchanges is that they won’t limit your account for winning, because it doesn’t matter to the exchange how much you win or lose.
Choosing a Betting Exchange
There are quite a few betting exchanges in the market, though the one that everyone’s heard of is undoubtedly Betfair. Betfair is one of the largest and oldest betting exchanges in the world, but this doesn’t actually mean it’s the best. A lot of casual gamblers will choose Betfair because it’s big, it’s well-known, and all their friends use it; all pretty poor reasons to choose an exchange. At the end of the day, we’re all in this game to make a profit, and the most attractive betting exchange is probably the one that’s going to maximise your winnings for you.
This is where Smarkets comes in. Smarkets offers a 2% commission on bets, which means that every time you win a bet (whether you’re backing or laying your selection), they will take 2% of your winnings. This 2% is more than made up for by the better odds you’ll get using a betting exchange rather than a traditional bookmaker, and since Smarkets will take 2% from the winner whether it’s you or another punter, they aren’t going to limit you for repeated success.
This is all true of Betfair, too, except that Betfair’s commission is usually closer to 5%; rates of 2% are generally only available when customers are given discounts and bonuses for loyalty and frequent use. The basic commission rate at Betdaq and Ladbrokes (which are actually the same exchange, essentially) also starts at 5%. Just as you might shop around for better interest rates (where higher is better) when opening a new bank account, it only makes sense to shop around for better commission rates (where lower is better) when placing a bet via an exchange.
An Insider’s Perspective
Smarkets was founded in 2008 by a team of finance and software engineering professionals, and offers a betting platform to customers wanting to gamble on anything from sports to politics. What sets Smarkets apart from the competition is its company ethos of putting punters first. With a background in finance, CEO Jason Trost understands how important profit margins are in the world of professional gambling. This is why Smarkets’ main USP is their low commission rates; they know what counts, and by offering super-low rates they know they can make or break a decent betting system.
Smarkets’ business model, which puts the punters first, makes it ideal for professional gamblers, such as Betting Gods’ customers. While Betfair remains popular with hobbyists who enjoy the convenience of a quick flutter, Smarkets is for serious betters who want to realise maximum profits from regular bets.
While the 3% difference between the commission taken by Smarkets and that taken by other big name exchanges might sound trivial, it is anything but. Consider that many people use gambling as an alternative to traditional investments to grow their financial portfolio; no-one could argue that a 3% difference in savings accounts interest is massive, and so why is gambling commissions any different? Over the course of a year or longer, a 3% higher commission can eat into big profits and even completely eat away small profits. Why make that sacrifice for Betfair?
Many of our tipsters average between 50 and 80 tips per month, with an aim to providing a steady income for their customers. If we take the highly successful Flat Racing Master as an example, customers using this tipster make an average monthly profit of £489.82, for a total profit of £4,408.40 since 1st December 2015. If these bets had all been placed through Betfair or Betdaq, customers would have paid out £220.42 in commission fees at 5%. In contrast, if they had all been placed through Smarkets, only £88.17 would be lost to the exchange’s minimal 2% commission. It’s not difficult to see how, year on year, these savings can easily add up.
The Professional’s Choice
Smarkets is a highly recommended alternative to more well-known betting exchanges such as Betfair and Betdaq. While traditional bookmakers still have a corner on certain areas of the market – such as small events and early bets, where bookies will often (but not always) have a bit more available than exchanges – any professional gambler worth his or her salt should certainly be conducting a fair amount of their business in a betting exchange, and will likely make the best profits over time with Smarkets.
We find ourselves saying again and again that successful gambling is about discipline, restraint, and perspective. Making the choice to use a low-key but profitable betting exchange like Smarkets over a more well-known, PR-savvy exchange is exactly the kind of cool-headed rationality that punters need to demonstrate in order to do well in the competitive world of professional gambling.