A betting exchange is just like any of the popular exchanges that we know of, namely the Foreign Currency Exchange (Forex Market), Commodity Exchange, and Stock Exchange (we all know this one). A Betting Exchange is like any of the Exchanges mentioned above. This is a platform that brings together people who buy and sell Bets. This has been made possible thanks to the advent of the Internet and Betfair.com who pioneered this with Flutter.com in 2000.
Same way, a Bet Exchange brings together Buyers and Sellers of sport bets which is a form of speculative instruments. The bet exchange has even grown beyond sports as people are now even trading on such events as Elections, Talents and Reality shows. Even the last Brexit vote was traded. The upcoming US election is being traded heavily even as I write this.
There are about Four main Betting Exchanges around the world right now (like you have the London, New York, Lagos Stock Exchanges) namely:
Just like the search engines which have Google as the giant, Betfair is the giant of all the Betting Exchanges and controls about 80% of the market. So I will be concentrating and using Betfair for all the examples in this ebook henceforth. Hope you understand.
At Betfair people are trading on different speculative activities by either Buying (Laying) or Selling (Backing) them. Like every market in this life, to make a profit, you have to buy low and sell high. The principle is the same everywhere including Betfair. The good thing about the Betting Exchange is that you can sell first before buying or vice versa.