Module I: Basics
9. Live betting and cash out
Before kick-off or live: what changes in the price?
The live market (betting that stays open during the match, as opposed to the pre-kick-off offering, which is called prematch) offers the same markets as prematch, only repriced every second. Two things change to your disadvantage. The first is the margin, the bookmaker’s built-in profit mark-up: it is the cut baked into the odds, and it is why the odds are always slightly worse than the true chance would warrant. Live, this mark-up is typically higher than before kick-off. The second is the bookmaker’s built-in defence, the few-second bet delay: it ensures that you cannot get ahead of the repricing with fresh information. On a goal chance or a VAR review the market is even suspended, that is, for a while you cannot bet on it at all.
The most important illusion: "I’m watching the match, I can see better what to do". In reality the bookmaker has data recorders sitting at the ground, the people known as scouts: within seconds they report what happened on the pitch, and the machine reprices the market immediately, without any human intervention. Compared with that, the TV or stream picture is 10-30 seconds behind the pitch. Live, you react to the bookmaker’s price, not the other way round.
Live, the bookmaker has a structural advantage: faster data, higher margin, controlled latency. If you play it, you pay this price at every quick decision.
Cash out: why is it almost always a bad deal?
Cash out is not a favour but a transaction: the bookmaker buys back your slip at its own live prices, with its own margin. Let us work it through. You staked €100 at 3.00, which means that if it comes in you get back €300 in total, your stake included. Your team is now ahead, so its chance of winning has gone up: suppose that its true chance, that is, the chance calculated without the bookmaker’s mark-up, is 60% at this moment. That is only an example figure; it comes out when you work backwards from the live odds (chapter 8). The slip either pays €300 or nothing, but if you had a hundred such situations, roughly sixty would come in and forty would not, so on average each one would be worth 0.60 × €300 = €180. This is what we call the fair value of the slip, meaning its value without the mark-up. The bookmaker’s offer will typically be noticeably below this, say €165. The missing €15 is its exit margin, roughly 8 per cent of the value of the slip: that is what you pay to have the money for certain, right now.
That is, with cash out you pay a margin twice. When you took 3.00, the bookmaker was already giving you slightly worse odds than the true chance warranted: that was the first deduction, sitting inside the price. Now, on exit, it gives you €165 instead of €180: that is the second (the margin of the live price). Used regularly, this is one of the most expensive habits. When might it still make sense? Essentially in two cases. One is if you work not on gut feeling but with written-down estimates, and after many matches the review shows that you demonstrably price the live market more accurately than the bookmaker. This is very rare: until many reviewed bets stand behind it, it is not you. The other is if you have to close because of a genuine external constraint. Closing "for peace of mind" is not a strategy but a purchased feeling.
The cash-out button is one of the bookmaker’s most profitable products: it prices your fear that the profit you already have might still slip away. That back-and-forth swing is what we call variance, and you pay a surcharge, a premium, to be rid of it. If the outcome of a match is that stressful, the stake was too big: what needs adjusting is not the exit button but your stake size, going in with half the amount, say. Exactly what stake suits you is the subject of chapter 24.
Traps of live markets
The fastest-spinning live products are the micro-markets: next corner, next throw-in, next goal within 10 minutes. They are at the same time the most expensive, meaning that for the same chance you get the worst odds here, because this is where the bookmaker builds in the largest mark-up. Psychologically they are also the most dangerous: they are decided in seconds, they give immediate feedback, and they offer unlimited repetition. This is slot-machine logic, in a sporting guise.
The other cost of the live tempo is quantity: whoever plays live places more bets, and every bet pays the (higher) live margin again. In chapter 8 we saw that on an accumulator, that is, a slip with several picks on it, the mark-up of the picks piles up, which is why a slip with several picks is much more expensive. The same margin compounding happens live in time: it does not multiply on one slip but adds up over your evening. If you place twelve bets during one match, you pay the mark-up twelve times, and the higher live version of it at that. And chasing losses (tilt), that is, wanting to win back the money you have lost as fast as possible, is fastest of all live; chapter 36 deals with this in detail.
If you play live: a pre-set plan, a pre-set budget, and no micro-markets. The fast market lives on your fast decisions, and your fast decisions are more expensive than you think.