| Get to know Spread Betting. | Example 2 |
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Section 2
GETTING TO KNOW SPREAD BETTING
When spread betting first became available, one of the first bets was on the sport of cricket because like the general election --- large numbers can be involved and there is a lot of volatility in cricket. Anything can happen - a game can change in the course of one over. Also, most of the bets made are in the Totals section, eg. number of points scored, goals in a competition or runs made in a cricket match by one team or the other.
TOTALS
EXAMPLE 1-- A ONE DAY CRICKET MATCH
ESSEX v LANCS ---- SPREAD BET OFFERED ON TOTAL RUNS FOR ESSEX IN 1ST INNINGS.
Spread betting companies will have studied beforehand the averages, the present form of players, the weather, injuries etc. From this information they will take their position on Essex 1st innings, i.e. what they think Essex will score.
0----------- 220 -- 240 ----------- ?
In this case the company are pretty sure Essex will score between 220 and 240 runs. This margin of runs 220-240 is the SPREAD of runs for the company.
If a person wants to bet, then they must be sure themselves that Essex will either score LESS than 220 runs , or MORE than 240 runs. If a person is not sure, then do not bet.
HOW DO YOU BET ?
Firstly you must have an account with a spread betting company, usually a deposit account, but not always. You can bet by phone or via the internet.
You use the words BUY and SELL to make your bet.
Decide what bet you want to make. Let's say -- you want to bet Essex to score more than 240 runs. You must also decide on your unit stake. Let this be £5 per run.
Instruct the company that you want to BUY Essex at 240, at a unit stake of £5. The idea is to Buy every run over 240 and Sell them back to the spread betting company in order to make your profit.
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Now let us see what happens with different results.
Eg.1 ---- Essex score 285 runs. (i.e. more than the spread of 240)
So you calculate your bet. 285 - 240 = 45 runs @ £5 = £225 profit when you sell them back to the company. This selling them back is done automatically of course by the company after the final result and any profits, as in this case - £225, will be credited to your account. The final result after the completion of an event is known as the Make Up. It is the figure used to settle bets that are still open.
Eg. 2 ---- Essex score only 170 runs.(i.e. less than the 240 figure you took in the spread)
So calculate your bet. 240 - 170 = 70 runs @ £5 = £350 loss when the final result is known. This loss will be deducted from your account.
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Now let us imagine that you had a different bet. That Essex will score less than 220 runs and that your unit stake is £ 8 per run.
Instruct the company that you want to SELL Essex at 220, at a unit stake of £8. The idea is to Sell every run under 220 so you can buy them back later at a profit if you are correct.
Eg. 3 ---- Essex score 123 runs.(i.e.less than the 220 you took in the spread)
So calculate your bet. 220 - 123 = 97 runs @ £8 = £776 profit when you buy them back from the company. This will be done automatically by the company at the Make Up and the profits will be credited to your account.
Eg. 4 ---- Essex score 260 runs.(i.e. more than the 220 you took in the spread)
So calculate your bet. 260 - 220 = 40 runs @ £8 = £320 loss at the Make Up. This loss will be deducted from your account by the spread betting company.
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Really, this is like buying and selling at any market for profits, except this is betting on the runs with unit stakes ( £1, £5, $2, 20 Francs -- whatever). In this market -- the difference between the buying and selling price is called the Spread.
So once again :-
(a) BUY -- in order to sell back to the company at a profit.
(b) SELL --in order to buy back from the company at a profit.
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EXAMPLE 2 -- A CUP MATCH IN FOOTBALL -- 1st LEG.
LEEDS v AJAX ---- SPREAD BET OFFERED ON THE TIME OF 1st GOAL IN GAME
This is a similar type of spread bet, but this one is based on the time, in minutes, of the first goal. You have to predict whether the goal will be earlier or later than the Spread. Again, the companies will have studied the teams and decided maybe --- Ajax are playing away but they are a very attacking team and have a high score rate. Also, in this competition, away goals count double if overall score in both matches is a draw. Of course Leeds need to score as many as possible at home, as it is always more difficult playing away.
So the SPREAD for the company might be :-
SELL --37 -- 40 -- BUY
(a) If you want to bet that the 1st goal will be earlier in the game then SELL ( the time in minutes to the company ) at 37. Give your unit stake.( eg £2 per minute)
(b) If you think the teams will be very cautious to begin with and believe that the 1st goal will be later than the spread ------ then BUY at 40.(eg.unit stake = £2)
Let's check the results. Imagine now that the 1st goal is scored in the 4th minute.
If you had made the bet -- (a) to SELL at 37, then you would have been correct. You can now buy back your minutes at a profit.
i.e. 37 - 4 = 33 x £2 unit stake = £66 profit.
If you had made the bet -- (b) to BUY at 40, then you were wrong --- and you have to sell your minutes back to the company at a loss.
i.e. 40 - 4 = 36 x £2 unit stake = £72 loss.
You have to be very careful in spread betting, while although you can win well, you can also lose very badly. Imagine--- had the unit stake above, in both (a) and (b) been £30 per minute.
In the 1st case (a) you would have won £990 ( 33 x £30 ).
In the 2nd (b) you would have lost heavily ---£1080 ( 36 x £30 ).
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NOTE:-
Spread betting offers a variety in the way you can bet on sports and other events. We have had examples of spreads relating to total amounts of things ---- runs in cricket, time of goal in football. From the lists above, you can see that you can nearly bet on anything.
A popular totals bet is shirt numbers. This is adding up all the numbers on the shirts of the players who score -- goals in a football match, or trys in a rugby game, touchdown scorers in gridiron etc. Another popular totals bet is aggregate winning distance in lengths of all the winners on the day at a race meeting.
Spread betting also offers bets on winning margins, supremacy, match betting, performance-index betting, favourite etc. You can also bet in - running. This is a bet you can make on a live event while it is in progress. We will look at some of these other types of spread bets.