Hedging Calculators

Analysis & How it Works

In betting exchanges, we always talk about Back and Lay:

• Back: Means you are betting on an outcome to happen.
  Example: Back Team A to win. This is the “normal” bet you would place at a regular bookmaker.

• Lay: Means you are betting on an outcome to not happen.
  Example: Lay Team A to win (meaning you are betting that they will not win — either they lose or draw). In practice, you become the “bookmaker” for the other user and take on the risk of paying out if the outcome occurs.

Example with numbers (including commission):

• Bankroll: €100
• Bet: Team A to win
• Back Odds: 2.50
• Lay Odds: 2.40
• Lay Commission: 5%

1️⃣ Back Bet:

Stake €100 on Team A to win.
If Team A wins: Profit = 100 × (2.5 − 1) = €150
If Team A loses: Loss = €100

2️⃣ Lay Bet:

Stake on Lay Team A at odds 2.40 to hedge.
Lay Stake = (Back Stake × Back Odds) ÷ Lay Odds = (100 × 2.5) ÷ 2.4 ≈ €104.17

Outcomes (with 5% commission on Lay profit):

• If Team A wins:
  Win from Back: €150
  Loss from Lay: Liability = 104.17 × (2.4 − 1) ≈ €145.83
  Net Profit ≈ €4.17
• If Team A loses:
  Loss from Back: €100
  Win from Lay: 104.17 × 0.95 ≈ €98.96
  Net Profit ≈ −€1.04