Betting glossary

37 terms defined in plain English — the ones you actually need to read a tipster's record and understand what it is claiming.

Exchange betting

Lay bet#

A lay bet is a bet that a selection will not win. Instead of backing a horse, you take the other side of somebody else's bet on it: you receive their stake if the horse loses and pay them out if it wins. Laying is only possible on a betting exchange, because it needs another user willing to take the opposite side.

Back bet#

A back bet is the conventional bet that a selection will win. You stake an amount, and if the selection wins you are returned your stake multiplied by the odds. Backing risks a small amount to win a larger one, which is the mirror image of laying.

Betting exchange#

A betting exchange is a platform where users bet against each other rather than against a bookmaker. It matches somebody who wants to back a selection with somebody willing to lay it, holds both sides until the event settles, and takes a commission on net winnings instead of building a margin into the odds. Betfair is the largest exchange in the UK.

Liability#

Liability is the amount you stand to lose on a lay bet if the selection wins. It is calculated as the lay stake multiplied by the lay odds minus one, so laying £10 at odds of 5.0 carries a liability of £40. The exchange reserves this amount from your balance as soon as the bet is matched, which means liability, not stake, determines how much money a lay strategy actually ties up.

Matched and unmatched bets#

A bet on an exchange is matched once another user has taken the opposite side of it at the same odds, and unmatched until then. An unmatched bet is not a bet: it carries no liability and settles for nothing if the event starts before anybody takes it. Bets can also be partially matched, where only some of the requested stake finds a counterparty.

Commission#

Commission is the percentage an exchange charges on net winnings in a market, typically deducted only when you finish ahead. Because it is taken from winnings rather than from stakes, it costs a high-strike-rate strategy proportionally more than one that wins rarely at long odds, and it should be included in any honest calculation of returns.

In-running#

In-running, or in-play, betting means betting after an event has started and while it is still being decided. Prices move very quickly in running as the race unfolds, and there is a delay of several seconds between placing a bet and it being matched, which means the price you see is not always the price you get.

Greening up#

Greening up means placing an opposing bet at different odds so that you lock in the same profit or loss whatever the outcome. If you back a horse and its price shortens, laying it at the new shorter price guarantees a profit spread across every result. The name comes from the exchange interface showing the guaranteed position in green.

Odds and prices

Decimal odds#

Decimal odds express the total return per unit staked, including the stake itself. Odds of 5.0 return £5 for every £1 staked — £4 profit plus the £1 back. Exchanges use decimal odds exclusively because they make lay calculations straightforward, whereas fractional odds like 4/1 describe only the profit.

Fractional odds#

Fractional odds express profit relative to stake, so 4/1 means four units of profit for every one staked. They are the traditional format in British racing and are still used on course and in bookmakers' displays. To convert to decimal, divide the fraction and add one: 4/1 becomes 5.0.

SP (Starting Price)#

The starting price is the official odds returned for a horse at the moment a race begins, set from the prices available in the on-course betting market. It is the price used to settle bets placed "at SP" rather than at a fixed price, and it is the standard reference point for comparing what a selection actually returned.

BSP (Betfair Starting Price)#

The Betfair Starting Price is the exchange's own starting price, calculated from all the back and lay money left in the market at the off. Bets placed at BSP are matched at that computed price rather than at a price chosen in advance. BSP is often used to record system results because it is a single published figure that cannot be cherry-picked after the event.

Drifter#

A drifter is a selection whose odds lengthen in the period before an event, meaning the market has become less confident about it. A horse moving from 3.0 to 5.0 has drifted. Drifts are often read as a signal that informed money is going elsewhere, though a drift can equally reflect nothing more than weight of money on a rival.

Steamer#

A steamer is a selection whose odds shorten sharply before an event, meaning money has arrived for it. A horse moving from 8.0 to 4.0 has steamed. Like a drift, a steam reflects where money is going rather than any guaranteed information, but sharp late moves attract attention because they can indicate well-informed backing.

Overround#

The overround is the amount by which a bookmaker's implied probabilities across a market exceed 100%, and it represents their built-in margin. A market priced to 115% has a 15% overround, which is the edge the layer of those odds holds before any judgement about the event. Exchanges have a much lower effective overround because they charge commission instead.

Value#

Value describes a bet where the odds available are longer than the true probability of the outcome justifies. A horse with a genuine one-in-four chance is value at odds above 4.0 and poor value below it. Value is the only thing that determines long-run profitability: picking winners is not enough if the price taken was too short.

Bet types

Each-way bet#

An each-way bet is two bets of equal stake: one that the selection wins, and one that it places. The place part pays at a fraction of the win odds, commonly a quarter or a fifth, over a number of places that depends on the size of the field. A £10 each-way bet therefore costs £20 and can return a partial profit when the selection runs well without winning.

Place market#

The place market settles on whether a selection finishes in the placed positions rather than whether it wins. How many places count depends on the number of runners, so the same horse can be a place winner in a large field and unplaced in a small one. Place odds are always shorter than win odds for the same selection.

Accumulator#

An accumulator combines several selections into one bet, where every leg must win for the bet to pay out and the returns from each are rolled into the next. The potential return is large because the odds multiply, but so does the chance of losing: a five-leg accumulator with each leg at even money wins roughly one time in thirty-two.

Level stakes#

Level stakes means placing the same amount on every selection regardless of confidence or odds. Results quoted to level stakes are directly comparable between systems, because no staking plan is inflating or masking the underlying performance. Any record that does not state its staking plan is difficult to interpret and easy to flatter.

Staking plan#

A staking plan is the rule that decides how much to bet on each selection. Level stakes bets the same amount every time; proportional plans bet a percentage of the current bank; progressive plans increase stakes after losses. A staking plan changes the shape of a bankroll's ups and downs but cannot turn a losing set of selections into a profitable one.

Bank (bankroll)#

A bank, or bankroll, is the money set aside specifically for betting, separate from everyday finances. It is normally measured in points rather than currency so that results can be compared between people staking different amounts. A bank needs to be large enough to absorb the worst losing run a strategy is likely to produce, not merely its average result.

Points#

A point is one unit of stake, used so that results can be published without reference to any particular stake size. A service reporting +50 points has made fifty times its unit stake in profit, which is £500 to somebody staking £10 a point and £50 to somebody staking £1. Points make records comparable across bankrolls of any size.

Measuring results

ROI (return on investment)#

ROI is profit divided by total amount staked, expressed as a percentage. A service with a 12% ROI has returned twelve points of profit for every hundred points staked. It is the fairest single measure for comparing services that bet at different odds and different volumes, because unlike raw profit it does not simply favour whoever has been running longest.

Strike rate#

Strike rate is the percentage of settled bets that win. It says nothing about profitability on its own: lay systems typically post high strike rates because most horses lose, while backing systems at long odds can be highly profitable on strike rates below 20%. Strike rate should always be read alongside the odds taken and the resulting ROI.

Sample size#

Sample size is the number of settled bets a record is built on, and it determines how much weight the record deserves. Forty bets is a run of luck; four thousand is evidence of a method. Any published ROI or strike rate without a sample size attached is close to meaningless, because a small enough sample can be made to show almost anything.

Drawdown#

Drawdown is the largest peak-to-trough fall in a bank over a period, and it measures the worst stretch a strategy has actually put its followers through. A system that finished a year up thirty points having been forty points down in the spring is a very different proposition from one that climbed steadily, even though the final figures match.

Losing run#

A losing run is the longest consecutive sequence of losing bets a strategy has produced. It matters more than average performance for deciding bank size, because a bank that cannot survive the longest historical losing run will not survive the next one. Every profitable strategy has losing runs, and a record showing none is a record that is too short.

Proofing#

Proofing is the practice of recording selections publicly before an event starts, so results cannot be edited afterwards. Proofing is what separates a verifiable record from a set of screenshots: the timing of the record is the evidence. Records that are compiled after results are known, or that are held privately, cannot be independently checked.

A/E ratio#

The A/E ratio compares actual winners to expected winners, where expectation is derived from the odds. A figure above 1.00 means a group of runners has won more often than its prices implied, and below 1.00 means less often. It is a way of judging whether a pattern is genuinely outperforming the market or simply reflecting short-priced favourites winning as expected.

Racing terms

The off#

The off is the moment a race starts. It matters for betting records because a selection published before the off can be independently verified, while one published afterwards cannot. It is also the point at which starting prices are set and at which exchange markets turn in-running.

Going#

The going describes the condition of the racing surface, from firm through good to heavy. It has a substantial effect on which horses run well, because many are markedly better suited to one end of the range than the other. Going is officially assessed before racing and can change during a day if the weather turns.

Handicap#

A handicap is a race in which horses carry different weights assigned by an official handicapper, with the better-rated horses carrying more, so that in theory every runner has an equal chance. Handicaps make up a large share of British racing and are generally harder to predict than non-handicap races, which is reflected in longer odds across the field.

Form#

Form is the record of a horse's recent performances, usually written as a string of finishing positions with the most recent last. Form figures are the starting point of most analysis, but they need context to be useful: a string of poor finishes against strong opposition can indicate more ability than wins in weak races.

Favourite#

The favourite is the runner with the shortest odds in a market, meaning the one the betting public collectively rates most likely to win. Favourites win roughly a third of British races, which is often enough to make laying them dangerous and rarely enough to make backing them automatically profitable.

Nap#

A nap is a tipster's strongest selection of the day, singled out from everything else they have advised. The term is a convention of newspaper tipping rather than a measure of anything, and a nap carries no more statistical weight than any other selection unless a tipster's naps are recorded and measured separately.

Course and distance (C&D)#

Course and distance, abbreviated C&D, notes that a horse has previously won over the same track and the same trip. It is recorded because some horses are markedly better suited to particular courses — undulations, turns and finishing straights vary widely — and a proven C&D winner has demonstrated that suitability rather than being assumed to have it.