Can You Make a Living from Spread Betting?

Most beginners may not have heard of such a concept as spread betting. However, to use it you will need to have minimal knowledge in this area, which you will get during the first few bets. Before you begin, you should understand more clearly what spread betting means in order to get the maximum benefit.

Fixed odds or spread betting?

You should start betting on regular odds. The main task of the bettor will learn to correctly analyze various events, statistics and so on. This will help to make a forecast for the match, which will affect the profit in any case. However, when it comes to income, in this regard, spread betting is somewhat more profitable.

Fixed odds mean winning only if you guess the event. Spread betting is different in that you don’t have to accurately predict the final outcome of the match. It is enough to determine whether the team will play better than most bookmakers and other players expect.

If you are sure that the team will not win the match, but will perform much better, then you can apply spread betting.

As a result, such an approach does not reward as victorious as just a good performance. This approach can be used in various tournaments, for example, the World Cup.

The essence of spread betting

Bookmakers offer to bet on the winner of the tournament at the group stage. Suppose you want to bet on a team that is unlikely to win the tournament, but will definitely reach the finals. In this case, you can’t wait for the end of the championship, and after the group stage to sell your bet.

If the team really goes into the final stage of the tournament, its probability of victory will increase slightly, but the odds of victory will remain the same. Therefore, you are very likely to find the buyer of your bid.

Receipt of payment

To start making stable money on spread betting, first of all, you need to become more selective in your own bets. In other words, do not conclude as many bets as possible. The problem is that if your bet only slightly exceeds expectations, then the profit will be very meager. Therefore, a more thorough analysis of the championships is required.

If you can determine exactly which bets carry minimal risk, then you will consistently earn. Of course, in some ways, spread betting resembles bets on outsiders, since betting on a favorite in this case will not be of particular benefit. The peculiarity is that when forecasting the reputation of a team should be discarded and bet based solely on the physical form and statistical indicators.

Advanced trading

Betting on outsiders is quite risky, because even with a good game, at the end of the game they can easily drain the match. However, spread betting is different in that the player needs to wait for the right moment, for example, an increase in the chances of an outsider to win. In this case, the value of your bet will increase and it will be profitable to resell it.

This often happens especially in football matches. During the first half, an outsider can keep zeros on the scoreboard or even score a goal. Thus, the initiative will go over to them, which means that the odds will also change. However, your pot will remain the same, so there will be a lot of players who want to buy a bet.

Many will find that selling a bet when it is in a winning position is not profitable, but this is not entirely true. An outsider of a match, even after a goal is scored, is not always able to maintain an advantage, therefore it is much safer for a bettor to receive a fixed profit without unnecessary risk and go on to analyze another event.

Types of sports betting spreads

As in the case of handicaps, there are types of spreads, first of all, minus and plus ones. With a negative spread (for example, “minus 12.5 points”), it is assumed that the team to which such a spread is set should win with a difference that remains positive if the value indicated in the spread is taken away from it. In the case of our example, this will be a victory of 13 or more points, which will provide an advantage to the winner even after we take away the value of the handicap spread.

Accordingly, a spread with a positive or plus value is a handicap that must be added to the final score by the outsider. If after this the score of the match is in favor of the outsider, the positive spread is played, otherwise the bet loses. In the case of the spread value “plus 12.5 points” for a basketball match, the team must lose no more than 12 points or win the match for the bet to play.

Practical Spread Betting

Initially, spread betting was born as a financial strategy similar to the strategy of bookmakers. As the financial market becomes more and more unpredictable, brokers decided to try this method. Since the 70s of the last century, spread betting has gained great popularity, but there are doubts as to whether it can replace the classic trade.

Bettor in spread betting can bet both on growth and depreciation, making a profit from each case. You can bet on stocks, raw materials, metals, options.

There is a certain asset rate. If we set it to increase by 1 dollar per item, then we will win when it is raised. When lowering, we will, respectively, lose.

There are clear advantages to this strategy over others:

• big capital is not needed: minimal funds are enough;
• trading is carried out around the clock and does not stop after the market closes;
• the difference between the purchase and sale prices is quite low;
• some countries do not tax profit from spread betting.

Among the risks that this strategy has are a short-term perspective and a high degree of risk. If a player bet on a fall, and the course suddenly rose, then the loss will be unlimited. To minimize them, you can use the stop loss, free or paid. Of course, paid gives more guarantees.

So, spread betting is a bet on every point of a financial instrument, while in classical trading, only a specific number of shares is allowed to purchase a deposit amount.

Example

For example, you can take a football match between the teams of Barcelona and Juventus. The bookmaker assumes that the first goal in it will be scored in the 25th minute. Thus, a spread appears in the line in the form of 24-26 minutes. Now the turn comes for forecasts of cappers. The player must choose before this period a goal will be scored or later. If they choose the lower threshold, then we will talk about the game for lowering (Low/Sell). If the choice falls to the upper threshold, that is, after the 26th minute, the game will be conducted to increase (High/Buy). It is important to understand that both thresholds of the spread are interconnected. For every Low/Sell offer, there is High/Buy.

Let the first goal of the match be scored in the 17th minute.

If the forecaster played a fall, then they won the bet. As a result, the winning amount is calculated using the following formula: ([lower threshold of the spread] – [real result]) * [bet size]. It is assumed that the player bet 1000 dollars at stake. In this case, they will win: (24 – 17) * 1000 = 7 * 1000 = 7000 dollars. Here the role of odds is played by the difference between the lower threshold of the spread and the actual outcome.

If the capper played for a raise, then they lost their bet. The amount of loss is calculated by the formula: ([real result] – [upper threshold of the spread]) * [bet size]. In this case, we will talk about losses: (17 – 26) * 1000 = -9 * 1000 = -9000 dollars. Thus, 9,000 dollars are deducted from the account of the capper.

As you can see, spread bets are extremely risky, but the profit can be stunning. The amount of possible losses and incomes depends on the value of the spread. For example, a football match lasts 90 minutes. If the spread for the first goal is set within 44-46 min., then the range of bets for the game to decrease and increase will be the same (excluding extra time). If the spread is in the form of 30-32 min., then the probable increase in the rate of gatherings will be higher than income.

In rapidly changing markets, gains and losses will constantly fluctuate seriously. Example: running in cricket or basketball, fouls in hockey, etc.

What is the risk of spread betting?

Since it is generally accepted that spread betting is a risky activity, you should understand what the risk is.

The main problem is that it is practically impossible to predict in advance what the size of the gain and loss will be. You can win everything at once and lose everything at once. In the betting shop we know in advance how much the win will be, and the loss in any case will not be greater than the bet made. In spread betting, we can’t be so sure, as losing can significantly exceed the size of the bet, being almost endless.

In this regard, we can give some recommendations to bettors who are going to play on spread betting:

1. Find out the maximum winnings, but be prepared for the worst result. Calculate in advance what loss from the amount of your funds can happen.
2. Be sure to follow the events and close the unfavorable bid on time. For this purpose, you can use stop loss if you can’t do it on time manually.
3. Identify markets where the result may differ significantly from the forecast. Among these sports can be cricket.
4. You should always remember that the size of the loss can be much larger than the size of the bet.

Conclusions

So, as you could already see, spread betting is a risky trade where you can win all at once or lose. In this regard, exchanges and bookmakers do not allow everyone in this sphere of trade. If the client loses big, they should be able to pay their loss. If they have nothing to potentially pay, then they will simply be not allowed in spread betting. Do not think that if you lose more than your bet, then you will not have to repay these debts. Spread betting bets do not take a brokerage fee, but this advantage is available to few.

So before you start making spread bets, think carefully: are you ready to part with your fortune if a single bet suddenly loses. And what is your condition like? Can it withstand such a large onslaught.

Surprisingly, most bettors, when they start betting, just don’t think about losing. They are attracted by crazy winnings, fabulous sums that brokers lure. But when the “pink glasses” come from below, it becomes very sad.

If you are not a professional, not an experienced financier, not a millionaire, it is better to immediately abandon the idea of ​​trying spread betting. These are bets for people of high class and big fortune. The desire to replenish their circle with the help of Lady Luck can end in failure.