This is part 4 of the Betwiser Sports Betting Beginners Guide. On this page, you’ll learn about what betting agencies are, which ones to use and promotional codes you can use when signing up with them to get the most for your money that you deposit
Online sports betting agencies (bookmakers and betting exchanges) provide websites where you can bet on sports.
These websites are fast, powerful and intuitive to use. The thing is their websites have to be at the top of the game as their whole business “is” the website.
Bookmakers – The traditional way
The way bookmakers make their money is not by betting against you – the punter. This is the biggest misconception people have about how bookmakers work.
Instead, the way bookmakers make their money is by trying to make the odds attractive enough so that they get an equal amount of people to bet for and against the sporting event.
Picture an English Premier League game, Manchester United versus Chelsea. What are the betting options here? Well, Man U can win, Chelsea can win, or it could be a draw. Three possible outcomes right?
The whole aim of the game for a bookmaker is to balance the amount of money they receive from punters on all three outcomes.
If they are successful in balancing the amount of money on all sides, they have effectively managed to make themselves a nice pile of cash regardless of the result… How?
They make their money from the difference between true odds and their set odds. I’ll show you this in an example as it should make it a lot easier to understand.
We’ll use that same example as above. Chelsea is playing at home against Manchester United. The odds may be represented as the true chance of each of the three outcomes occurring might be:
Chelsea at home: 2
Man United away: 6
Just a quick note here that the true chance is obviously not spot on correct. It can’t be because the outcome is not known. But what it represents is the closest odds to the event occurring.
Now let’s look at the relative probabilities for each outcome:
Chelsea at home: 50%
Man United away: 17%
I explain the maths behind odds in the next part of this guide.
If you add all the percentages together you will have a total of 100%. This represents a fair book. If bookmakers run fair books, they’re not making any money. Not too good for them I imagine.
If the bookmaker wants to make some money on this bet the odds will need to be reduced, to something like the following:
Chelsea at home: 1.8
Man United away: 5
We’ll take a look at the relative probabilities again for each outcome:
Chelsea at home: 56%
Man United away: 20%
Now by adding the percentages this time round we have a total of 112%
The amount that is over 100% is known as the overround and it represents the bookmaker’s potential profit if the proportion of bets has been successfully managed on all three outcomes.
Therefore using the bookmaker’s odds, if $112 is wagered in the correct proportion, only $100 will need to be paid out no matter what the results are in the example. How’s that possible?
Home win: A stake of $55.56 at odds of 1.8 returns $100
Draw: A stake of $37.71 at odds of 2.8 returns $99.99
Away win: A stake of $20 at odds of 5 returns $100
The total incoming amount of money (the stakes) totals $112 and the maximum payout to the winner comes to $100 irrespective of the result.
This leaves a profit to the bookmaker of $12 – this is a 10.7% profit on turnover (12 x 100/112)
The rise of Betting Exchanges
In the last decade a new way of betting has emerged. This way is called betting exchanges and leading the method and technology is Betfair.
In betting exchanges you are betting against other people in which you set your own odds. Betfair take a small commission from customers who win their bets. If you lose you pay no commissions.
Let’s take an AFL game where two teams are playing against each other. In the traditional bookmaker type betting you can bet on Team A winning, Team B winning or a draw.
Betting exchanges give you 5 ways to bet. You can bet in the same way as above, but now you can also bet against an outcome taking place.
An example is that Team A will NOT win. Here’s a table from a betting exchange where it shows all the ways to bet (odds represent betting options)
- Team A – Back
- Team A – Lay
- Team B – Back
- Team B – Lay
The bookmaker type of betting looks like this:
- Team A – Winner
- Team B – Winner
As you can see, betting exchanges make do without bookmakers. Usually in this way of odds are much lower.
Bookmakers or Betting Exchanges?
I recommend that you use both bookmakers and betting exchanges. They both have their own advantages.
You should open up multiple accounts at both agency types for the following reasons:
- To compare odds – odds are not the same – they can vary significantly from one betting agency to the other
- Betting agencies don’t like you winning all the time – If you consistently win, you may raise alarms. To stop this from happening, spread your bets across all your accounts
- Special promotions – Some promotions that come around are just too good to skip. I usually pounce onto any of these
My recommended Betting Agencies to use
There are a few recommended betting agencies that I like to use. These agencies are the big ones out there that have a good reputation.
They offer great promotions for new customers, they frequently offer great deals on sporting events, they always pay on time and their websites are state-of-the-art and easy to use.
You can’t go wrong using any of the following:
|Betting Agency||Type||Key points||Promotional Codes|
|Bet365||Bookmaker||This is one of the biggest betting agencies in the world. They are absolutely massive, with over 4 million customers in over 200 countries||Click through for full review and promotional codes for Bet365|
|Betfair||Betting exchange||This was the first betting exchange in the world. They have revolutionised the betting world by offering punters to bet against each other||Click through for full review and promotional codes for Betfair|
|Centrebet||Bookmaker||Second largest private bookmaking company in Australia and one of the biggest in the world||Click through for full review and promotional codes for Centrebet|
|Sportingbet||Bookmaker||This is the largest sports betting bookmaker in the world. Huge presence in the UK and Australia||Click through for full review and promotional codes Sportingbet|
|Sportsbet||Bookmaker||The biggest private bookmaking company in Australia. A lot of promotions, great company, one of my favourites||Click through for full review and promotional codes for Sportsbet|
|TAB Sportsbet||Bookmaker||TAB Sportsbet is a very well known and trusted bookmaker in Australia. They were owned by the Australian government a couple of decades go. They have outlets in States across Australia.||Click through for full review and promotional codes for TAB Sportsbet|
If you would like to check out other betting agencies or read more about the above ones, check out my sports betting agencies review page where I get into a lot of detail.
I should warn you that there are thousands of online sports betting websites out there on the Internet now.
Some of these are fraudulent, some run unethical business practices and some are not licenced or regulated by any government.
It goes without say that you really should stay away from these companies.
- Part 5 – What are Sports Betting Odds all about