Trade Ninja “EXPLAINED” series aim to help explain some popular Betting / Trading terms/areas.
Betting exchanges are online platforms that allow users to bet against each other on the outcome of sporting events, political events, and other events. Unlike traditional bookmakers, where users bet against the bookmaker’s odds, at a betting exchange, users set their own odds and bet against other users.
One of the ways that betting exchanges generate revenue is through commissions. A commission is a percentage of the user’s winnings that the exchange charges as a fee for using the platform.
The commission rate varies between betting exchanges and is typically between 2% and 5% of the user’s winnings. For example, if a user wins £100 on a betting exchange with a 5% commission rate, they will be charged £5 in commission.
It’s important to note that the commission is only charged on the net winnings of a bet. So, if a user bets £100 on a selection and the return is £200, the commission would only be charged on the £100 net winnings, not on the entire £200 payout.
Some betting exchanges offer a tiered commission structure, where users who bet larger amounts or more frequently can qualify for lower commission rates. Additionally, some exchanges may offer promotions or bonuses that waive or reduce the commission for a certain period or for certain users.
Overall, commissions are an essential part of a betting exchange’s revenue model, and users should factor them into their betting strategy when deciding which exchange to use and how much to bet.
If you are into Matched Betting then you are currently able to receive 0% commissions from multiple exchanges. One of the leading Matched Betting service providers OddsMonkey are currently offering their members 0% commission on 4 exchanges – Smarkets, Matchbook, BetDaq & Bet Connect.
OddsMonkey are also the only current Matched Betting service provider to include odds from all of the above exchanges in their tools!!