What is a Sports Betting Exchange?
Over recent years, sports exchanges have gained in popularity and “user friendliness.” Previously, sports bettors were worried about liquidity or the fact that some exchanges seemed difficult to use. Nowadays, several sports exchanges have the “look” of a sportsbook. In addition, the lines and pricing are great. In many cases, you can find better lines at the sports exchanges than at the low-vig sportsbooks
For moneyline sports, such as hockey and baseball, most sports bettors are happy to have “dimelines” — where the bid-ask spreads are 10 points apart (for example, -130 for the favorite, +120 for the underdog). Some low-vig books offer 8 point bid-ask spreads (-130/+122). The great thing about a good exchange is that the bid-ask spreads sometimes become 1 point apart (-130/+129)! One thing to remember, however, is that some of these exchanges charge separate commission ranging from 1%-2%.
Betting exchanges look like they will be “the wave of the future.” Why pay -110 vig when you can deal with a fellow sports bettor and get -103, +100, perhaps even +105??!! As sports bettors become more informed shoppers, an increasing number of players will migrate to the exchanges. This will lead to increased liquidity, improved pricing for players — and a self-fulfilling cycle of increased business for the exchanges (even better pricing for bettors, and so on).
One important point to note is that you can use sports exchanges in a variety of ways. Some players will shop the lines offered (called “offers”) on the exchanges and then “buy up an offer.” If the pricing isn’t great, the player might just use their regular sportsbook. Other players will put out bids and try to see if other players will accept their offer. In either case, it’s a great way to shop around for the best price.