Trading sports online can be a very profitable pastime and as a growing number of people get involved that means just one thing… liquidity. With the invention of the betting exchange as well as the rise and rise of the main one, Betfair, there is increasingly more income being traded on sports.

From horse racing to tennis and football to greyhound racing there are plenty of markets to select from and specialize in. There are actually even markets for financials and politics.

In-play betting and the capability to place “lay” bets have revolutionized our capability to cash in on these markets (for all those not in the know a lay bet is betting that an event will not occur ie a horse will not win a race). Just watch any in-play tennis match and see how the odds move. Making sense of these patterns and developing successful strategies to make regular profit will be the holy grail for lots of individuals.

The basic theory behind all this is that you’ll need to back at a better price than you lay. It’s the same as business all around the world, you buy a product at one price and you sell it at another, the real difference between the 2 being your net profit.

An example is I back a horse at 2/1 for Ł100. That is 3.00 in decimal odds. If it wins I win Ł200 and get my stake back. Prior to the start of the race the odds come down to 6/4 or 2.50. I then lay it for Ł100 and if the horse wins I have to pay out Ł150. The difference between my back winnings and my lay liability is Ł50. That is what I would win if this horse wins and if it does not, I lose nothing! A zero cost bet. The really neat trick is to “hedge” your winnings out so you win the same amount regardless which horse wins. Within the above example I could lay the horse for Ł120 guaranteeing me a Ł20 profit.

The most obvious problem is what happens should the odds rise? You’re left with a bet you can not sell or get rid of without losing at least several of your stake. read this blog article from iadsr.edu.pk is where the difference between traders and gamblers comes in. A gambler takes risks as a way to possibly achieve a profit. A trader is happy to take a series of small losses safe in the knowledge that the wins will outweigh the losses.

There are plenty of and varied approaches to trading however the most important thing is discipline. As soon while you fail to close a trade which has gone against you you are no longer trading but gambling. Sure, you might get away with it but when it goes wrong you will definitely lose a lot more than you bargained for. The most effective way to focus your mind and prevent the gambling tendency arising is to work to strict strategies with defined entry and exit points.