In online betting, sports trading is a combination of two or more bets which are placed on speculation for an anticipated outcome before it’s decided. Traders seek profit from the change in the betting odds before or during a sports event.
Sports trading is accepted on betting exchanges, where a player is allowed to bet against a team or just a possible specific outcome. Actually, a trader bets on the odds movement. In fact, it is all about predicting the momentum.
Sports trading is often distinguished to trading before the match as opposed to in-play trading, or trading in live betting.
A plain example of sports trading
The simplest case of sports trading is a pair of two opposite bets on the same event. If, for example, the first bet is placed in favor of a team, trading usually should be completed with a following counterbalancing bet against the same team, on the same exact amount. In this case the player, who is now called “sports trader” instead of “bettor,” predicts an unexpected drop in the betting odds of the team, so the trading would yield profit.
The combination of the two bets mentioned above constitutes a “trade”, a round-trip transaction. In essence, the trader sells high – bet in favor on long odds – while he buys low – bet against on short odds. The odds change between the two bets determines the generated profit, in direct relationship, of course, to the allocated amount on this bet/trade.
A large percentage of most trades – not “trading,” as “trading” is called the process – completed at the actual outcome of a specific event leads to either profit or loss. On all other outcomes – on a tie, for example, or on the opposition team when we talk about football – there is neither a profit nor a loss to be made after completing a trade.
Still, at the end of a trade there are techniques to balance the profit or loss in all possible outcomes, which could allow the trader to come out a winner (or maybe loser) to any eventuality of an event.
Sports trading follows supply and demand law
In the case of sports trading ahead of the start of a match, the continuous changing on the listed betting odds is affected strictly and only by gamblers betting in real time (rules of supply and demand). Odds are reflecting the actual supply and demand expressed by players placing their bets.
[quote type=”center”]In reality, to a considerable extent, bets come in line with any news deemed to affect the outcome of a match.[/quote]
When news is circulated in favor of a team, most players are influenced by the headlines or rumors betting accordingly for the team, matching all available bets at the highest odds until odds begin dropping. At some point, supply will overcome demand and odds will stop dropping. This process will continue adjusting the betting odds, balancing supply and demand, until next rumors, news, or developments hit the headlines.
At the end of the day, supply and demand will always be balanced. Nonetheless, in the globalized information age we live in, we expect continuous flow of news to which by the way, we all have access. For this reason, odds are changing from one moment to another.
In-play sports trading or trading live
As regards sports trading in live betting, also known as trading live or in-play trading, in this case we deal with an event which is currently underway. Therefore, the movement on the betting odds is primarily influenced by the performance of the teams during the match, instead of rumors and news.
Speculation and vague predictions can hardly affect the odds, while the progress of the match and developments during the game play the key role.
Consequently, traders who have immediate access to the match gain an advantage, as opposed to traders who watch the game with some eventual delay via a satellite program or other means of broadcast.
[quote type=”center”]Trading on live betting is perhaps the most risky form of online betting.[/quote]
It is possible that stakes are considerably increased during a match in favor of an outcome, well over the abilities and the budget of an ordinary undisciplined trader. In addition, decisions need to be taken under extreme mental stress and time pressure.
Sports trading is just another form of trading
Trading is not new. Any transaction concluded from ancient times till nowadays is a trade. Commerce is a trade, as people for thousands of years exchanged goods and services.
Today, trading is associated mostly with the financial markets, where trillions of dollars are traded daily. Therefore, it does not come as a surprise that various tools of economic analysis used in stock exchanges have made their appearance in sports betting, and more specifically in online sports trading.