Betting exchanges are a relatively new phenomenon in the world of bookmaking. Betting exchanges enable people to match the back and lay bets between the people placing their wagers, and in this way they help to cut out the usual role reserved for the bookmaker. This can cut into the bookie’s average profit margin. But betting exchanges do have their place and can have some benefits to the average person placing a wager.

A Shift in Trends

Bookmakers can use betting exchanges to their advantage every so often. For example, if the bookmaker has a particularly large or unfavorable bet he does not want, he can discard or lay off some of those bets and thus reduce the odds against his making a profit.

Basically, betting exchange sites act as a broker for the bettors who are placing their wagers on certain events, whether it is the outcome of a political election or a horse race. This process is somewhat comparable to what goes on at the New York Stock Exchange. Betting exchanges really just consist of person to person betting which some people may choose instead of going through a bookie.

Betting exchanges acting as brokers usually do charge a commission for their services. Betting exchanges can be a great way for people to make extra money, as they enable people to take and place wagers without having to pay the extra costs or to apply for a license that many bookmakers –particularly in the United Kingdom—must have. The prices for betting offered by these exchanges may be up to 20 percent more competitive than they would be through a bookie alone.

In effect, betting exchanges cut out the middle man when it comes to betting and gambling. In these cases, most of the time the middle man is the bookmaker. This can mean an important difference in the profits a bookmaker can earn throughout the course of a year. Also, with the prevalence of these sites online, people may choose the convenience of wagering through betting exchanges rather than a bookmaker for the sake of both money and expediency.