When we build a sports betting system we often spend a lot of time gathering statistics about a match, forgetting data offered for free by bookmakers and betting exchanges like Betfair. One such important figure is the betting volume, that is the total amount of money that has been matched in an event. Betting volume or turnover could serve as an input variable in the system we have started planning or another which we may want to improve.
Although the turnover is just a simple number, its use can vary from system to system, weighing differently for each player.
Before we analyze the implementation of volume as statistical parameter in sports betting, we should mention some of its key elements.
How can we find the volume of a betting market?
The betting volume, the total amount of money that is bet in favor of a particular slection, is known only by bookmakers. Sometimes these numbers are published after the completion of the match or event, to challenge stereotypes.
For example, we often hear that “Champions League final has reached a record number of bets” or that “betting on Eurovision song contest involved immense amounts of money“!
The exact figures are known only to sports betting companies, which actually know which selection attracted most of the bets’ volume. It is worth mentioning at this point that the ratio of money wagered on each option, is one of the key factors for the formation of the odds by the bookmaker in the first place.
With the advent of betting exchanges, players now gained some access to these numbers, although limited, as we speak only for the turnover of the specific exchanges. However, this information is provided free of charge, when a player clicks on the small graph which is located next to each match listing in the Betfair exchange user interface.
Besides various important information available in the new window that will open, the total betting volume of the event appears in the upper part, along with the turnover for each option with a mention to the last traded odds.
Here is an example from an English football market: Today Manchester City plays against West Ham. At the time of writing, the volume on Betfair is recorded at £165,000, while the vast majority of money is wagered on the home win.
What does the betting volume at betting exchanges mean?
When a player bets at a common betting company, that is a bookmaker, a bettor actually challenges the predictions of the bookmaker. Bookmaker expects the crowd to bet according to the ratio implied by the offered odds. If the bookmaker has offered wrong prices – in other words, made bad predictions – bettors’ aim is to exploit that.
In contrast, when a player bets at Betfair betting exchange, they are “matching” their bets with an opposite prediction made by another unknown player. It’s similar to buying and selling at the stock market, where in fact buyers and sellers bet against each other.
So in the first case, when a player bets £100 with the bookmaker, the betting volume of the transaction is equal to €100, while in the latter, two players have bet each £100, one backing and the other laying the bet. If the bets are matched, the turnover is again £100 in total, since that is the amount of money matched. Although we talk about two different bets, we should not be surprised, since, in essence, one player takes the place of the bookmaker.
Yet, the difference, regarding betting exchanges, lies on the possibility of sports trading. After some time or during the game, if these two players decide to bet again by the same amount closing their positions, changing sides so that the bookmaker becomes now the player, this will increase the total betting volume of the game by another £100. Now, this transaction should not be added to the total turnover of the betting market, as we talk for the original £100 of betting, which have now turned into trading.
Unfortunately, there is no way to distinguish which part of the betting volume we see in Betfair’s window corresponds to conventional betting or trading. Nevertheless, it is a useful piece of information.
How to use betting volume in a system
A first easy use of turnover in a betting system is to filter all matches by the total betting volume. In other words, we could impose as prerequisite to bet on a match or event with turnover greater than £100,000. In this case, the odds reflect as best as possible the opinions of a large number of players.
Furthermore, we are not running the danger of getting trapped in case of sports trading, given there is enough liquidity to trade out. One of the trading pitfalls is the case when a match attracts near zero interest and bets.
A second possible use of betting volume as input variable in a betting system is to provide an indication for a forecast variable. For example, we could bet in favor of teams that gather at least 50 percent of the betting volume, following an established trend. So the simplest system that we can create using solely the betting volume, is to check which team is more preferred as a winner and back that bet (as in the home win in the aforementioned English football game).
Of course, I wouldn’t be so optimistic applying such a simple system, but it may be the basis for shaping an elaborate betting plan that could bring long-term gains.
Therefore, it is really up to the creativity of each player to exploit the information of betting volume in the most efficient way, structuring a unique winning system.
Thus, it is worth to underline that important and useful information is not to be ignored because it is offered for free. A football system was based on this particular information of betting volume, which I had used a long time ago with pretty good results.