Betting exchanges let you back (bet that a horse wins) and lay (bet that it doesn't) at prices set by other users. Because you can do both, you can open a position and close it later at a different price. That is exchange trading.
1. How an exchange market works
Each runner has a ladder of prices. Blue prices are what you can back at; pink are what you can lay at. When someone takes a price, a bet is matched and the liquidity at that level shrinks. The last price at which money changed hands is the last traded price.
2. Why prices move before the off
Money arrives unevenly. Big races trade from the morning; small races may do most of their business in the last ten minutes. News, non-runners and gambles all move prices. Our race pages record every GB and Irish race from 15 minutes before the off, so you can see how markets really behave.
3. Opening and closing a trade
If you back at 5.0 and the price shortens to 4.0, laying £12.50 against a £10 back locks in about £2.50 on every outcome. Use the green-up calculator for the exact stake. If the price drifts, the same maths fixes a loss instead.
4. Ticks and the price ladder
Prices move in ticks, and tick size depends on the price band. Three ticks at 1.5 is tiny; three ticks at 15.0 is large. The tick calculator shows the full ladder.
5. The costs
Commission is charged on your net winnings per market. Small, frequent wins pay it every time, so a strategy that looks positive before commission can be negative after it. The commission calculator shows the effect.
6. Risk
Know your maximum stake or liability before you enter, decide where you will close a losing trade, and understand what happens to unmatched orders at the off. Many people lose money trading. If it stops being fun, stop.
Next steps
- Read the strategy guides below.
- Look at a few recorded races to see how far prices typically move.
- Check the steamers and drifters research before assuming a moving price means anything.