The only real option for attracting them is for Paddy Power Betfair to cut commission charges, which are generally 5 per cent.You have reached a degraded version of because you're using an unsupported version of Internet Explorer.įor a complete experience, please upgrade or use a supported browserīetfair to launch horse racing exchange wagering in New Jersey Boosting liquidity requires more punters.

However, a betting exchange operates like any other market: the more liquidity it has, the more value it offers participants, who can expect better returns as a result. As the clients determine the exchange’s odds, the group cannot attract more business by stepping in directly to increase potential payouts on a winner. The question is how Paddy Power Betfair tackles this. Jackson suggests that Bet365 operates at almost zero margins, not sustainable unless it simply uses racing as a way of luring punters to bet on other sports. In fact, the exchanges’ arrival in 2001 into a hidebound betting market ushered in a new era of competition that still influences the business.Įven so, it was surprising that Paddy Power Betfair chief executive Peter Jackson acknowledged yesterday that generous horse-racing offers from rivals such as Bet365 posed challenges to Betfair’s betting exchange, which was actually the first when it launched 17 years ago. Thus, a betting exchange should almost always offer more generous odds than conventional bookmakers, who build profit margins into their prices. The way exchanges work, the odds available against any horse in any race should ultimately reflect what the market believes are its real chances of winning.

If somebody else accepts the lower odds, the backer has a no-lose bet. One is that they allow punters to trade, so the person who backs the horse at 2/1 can offer shorter odds, say 1/1 (even money) against it. They work like this: one client fancies a horse to win at 2/1, the other offers those odds against the same beast crossing the line first, the exchange matches them and earns its money by charging whoever wins a commission. Online betting exchanges are a 21st-century phenomenon.

Betfair exchange rates