Lay, Back and Think of Winning

I’d like to give you a little background as to why I tried this system after being absent from the ‘betting scene’ for some time…. My interest in betting began at an early age as my Grandfather supplemented his income as a bookies runner in the days before bookmaking became legal. As a lad I used to help him with the paperwork and can still see him sitting at his table in the pub taking bets.

My first system was a Stop at Winner on 2nd favourites through the card which inevitably failed, but I confess that I rather naively bought it from a classified ad in “Exchange and Mart”. After that disappointing episode, I bought a book in the 70’s by a guy called Joe Karbo which took on a more analytical approach and concentrated on horses dropped in class which I combined with a graduated target + previous losses staking system. After the failure of that over a substantial period of time, I decided that I could do better on my own and in those pre-internet days spent a lot of time going through old issues of the Sporting Life up at the National Newspaper Archives, studying results and running paper trials. I eventually came up with my own system which was betting on selective favourites. Criteria included the number of runners, type of race etc. I tested and ran this system only using level stakes as I was convinced from past experience that if a system doesn’t work at level stakes, then it’s doomed to failure. The system did show a profit despite deductions for betting tax, so would surely be more profitable today.

Why then didn’t I persevere and pack in my day job? Firstly most betting systems rely on the law of averages, in that if you lose today and miss tomorrow’s racing then your losses will not be recouped. Secondly an enormous bank for quite modest returns was required, which made the system pretty much unworkable, in that for a decent return on short prices wagers had to be large and so getting them on at a bookmaker would be difficult and attract attention over a period of time. I finally decided I’d given it my best in hours of research and testing and that betting every day and wagering large sums just wasn’t going to work and called it a day.

Since then I’ve received hundreds of “get rich quick” betting systems through my letterbox all of which have gone straight off to the recycling plant. However, one day on Amazon I noticed a book entitled “Lay, Back and Think of Winning”, by Nigel Paul. I read the book’s synopsis which looked interesting and for the sake of £15 I thought “what’s to lose?”, so I bought it.

The book concentrates on betting exchange trading and as I’d been absent from gambling for some years I’d heard of betting exchanges, but never looked into this new way of betting. As laying is an option, memories of my grandfather came flooding back, which obviously whetted my appetite. I read Nigel’s book in just two sittings, but then had to re-read a couple of chapters several times to ensure that I had the system understood.

The meat of the system is backing and laying the same selection on a betting exchange, preferably a favourite, to lock in a guaranteed profit. The basis of this method is back when the price goes long and lay when the price goes short, so if the favourite wins you make a profit and if it loses you don’t make a profit, but you do cover your stake and therefore lose nothing.

The trick comes in gauging the ebbs and flows of this price movement, something which I struggled with at the beginning. My first mistake was starting to bet as soon as the odds became available. The author doesn’t state a time to place your bets, but testing showed that 15 minutes before “the off” was the maximum, as the time ticks away money becomes more fluid and available. You can back or lay first depending on which way the money is flowing.

Initially what I’d do was back or lay and then wait for a good price the other way. This was my second mistake as you must ride the ebbs and flows. Waiting too long means that the price can move against you significantly and because the returns are quite low this spells disaster for the bank. Although he does mention this in the book, it took me a while before I realised it.

Usually you back or lay and then go the other way in 1 or 2 minutes for a profit of just a few points. A little and often is the mantra. Success usually means a profit of only around 5 to 20 points depending on the price shift. If you get it wrong and don’t ‘bail’ quickly enough when the price moves against you then losses are difficult to recoup. I discovered that it’s worth taking a small loss of a couple of points and then restarting the bet when things settle down. Small losses shouldn’t be a problem but it’s tempting to wait and hope and in extreme circumstances this could see you incur a loss of 50-100 points at times as the price gets away from you. That magnitude of loss is impossible to recoup whereas 5 points is sustainable. My initial paper testing couldn’t sustain the losses until I changed parts of my strategy….

Firstly, I waited to watch the ebb and flow of the market to get “in the rhythm”. Secondly, I only bet in liquid races where there was money moving. Thirdly, as soon as the price moved against me I bailed, thus only incurring small losses. I then layed or backed, often several times on the same selection, and sometimes up to 6 times in the same race for accumulative profits. 

Results through the initial learning curve on 54 races was a bit disappointing with 49 points profit generated, although as time went on I could see an improvement in my success. On my refined method, working out the ebb and flow and it has to be said reading between the lines, the last 12 races I’ve traded on have shown a paper profit of 101 points, so I’m confident I’ve got the hang of it now. To be fair to the author he does stress that you need to go through this learning curve.

The attraction of this method is that you can use it whenever you like because if implemented properly your stake is always covered, so it doesn’t rely on betting all the time and the law of averages to recoup losses and bad days. Suggested staking is higher on shorter prices as they theoretically have a better chance of success and less on the longer priced runners, although I suspect it would probably work just as well using level stakes.

The downside of operating it with real money is two-fold…

1. Firstly, there isn’t always the matched money on offer to back or lay your bet, therefore you may not get on, or worse you may lay the bet but cannot back it (or visa versa) due to not being able to match it on the betting exchange.

2. Secondly, because you are working the ebbs and flows of the money, you must be extremely agile to get the price that you need for a profit as usually you are only dealing with a couple of points difference. By the time your bet is entered the price could have shifted the other way.

My analysis of this system is that it’s great on paper, but it may not work so well in practice for the reasons stated above. That said, if you’re new to betting exchange trading “Lay, Back and Think of Winning” will provide you with a useful insight into the methods professional traders use on the exchanges and at just £10 for a copy on Amazon it is a worthwhile buy.

If you’ve read this book yourself please feel free to leave your own comments below.

Until next time,

Online Betting Exposed

Published on August 1, 2008

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