What is Betting Exposure?

Exposure is the worst-case scenario liability for each market, i.e. the greatest loss of funds the customer may incur based on any possible market settlement, held by Betfair to ensure the customer has sufficient funds come settlement time.

So these funds are is still in your account, it’s just not available for you to bet again until it is no longer needed to cover your potential liability in that market.

Multiple bets on the same market adjust the exposure whenever a subsequent bet is placed and, exposure can be reduced/released as a result of an opposing bet.

Unlike a traditional Bookmaker, a Betting Exchange holds the customer’s exposure on a market rather than debiting each individual bet from their total account balance (Account Balance).

This is required to accommodate functions unique to a Betting Exchange such as the placing and editing of unmatched bets, and the trading on markets by placing Back and Lay bets on opposing selections. At all times, a customer’s exposure is subtracted from their Account Balance to form their balance that is available for bet placement (Cash Balance).

The Cash Balance is viewable at the top of all customer interfaces and is an accurate representation on how much money the customer has available to spend. It’s not until market settlement that the Account Balance itself, as viewable in the Account Statement, is credited or debited with the final settlement value.

Exposure Explained

This can be confusing, as traditional bookies will debit those funds as soon as you place the bet, and then credit the stake back along with the winnings of the bet.

When you place a bet with us, as we said we hold those funds in exposure but they’re never actually taken out of your account. Funds held in exposure don’t show in your available to bet balance at the top of the screen, however if you go to your account statement you will be able to see the that your exposure is included in that total figure.

If you wanted to prove this you could place a bet (say on a horse race). Before you place that bet note both your available to bet balance at the top of the screen and your account statement balance available here.

Once you place the bet notice that your available to bet balance goes down but your account statement balance doesn’t change. Once the bet is settled the exposure either gets released back into your account (if it’s a winning bet) and your winnings also get credited, or that exposure is now a loss and is deducted from your account, which will be reflected on the statement.

Example of Exposure

Here’s an example of the impact on an account’s exposure on a market by placing multiple bets and how this, in turn, alters the account’s Available to Bet Balance (Cash Balance) and Account Balance.

Market: English Premier League, West Ham v Liverpool 05/02/19 (the Market) with the three possible selections: West Ham, The Draw and Liverpool.

I start with an Account Balance of $125.26. As I have no current unsettled bets, my Cash Balance is also $125.26.

I place a Back bet of $5 @ 8.80 on West Ham (Bet 1):

My initial position on the Market after Bet 1 is as follows:

  • If West Ham win, I will receive a profit of $39.00.
  • If Liverpool or The Draw win, I will lose $5.00.

Therefore, the most I can lose upon Market settlement is $5. This is considered my ‘exposure’ and is taken off my available Cash Balance (at the top of screen). The exposure is held in trust by Betfair. However, as the bets are not settled, my Account Balance is still $125.26.

Note that my stake in the bets has NOT been removed from the Account Balance. Bet 1 can instead be viewed within Exchange Bets.

Now I will place another bet: a Lay Bet on Liverpool for $20 @ 1.42 (Bet 2).

Once Bet 2 is placed, you can see my overall position on the Market has changed:

  • If West Ham win I receive $59 profit
  •  If The Draw wins, I receive $15 profit
  •  If Liverpool win, I lose $13.40.

$13.40 is now the most I can lose on the market and, thus, is now my exposure. Note that the Cash Balance at the top-right of the screen is now $111.86 which is $13.40 subtracted from my original Account Balance of $125.26. Again, my Account Balance is still $125.26 as neither Bet 1 nor Bet 2 have been settled:

I now place a Back bet on Liverpool for $15 @ 1.41 (Bet 3):

My position in the Market is now as follows:

  • If West Ham wins, I receive $44
  • If Liverpool wins, I lose $7.25
  • If The Draw wins, I neither receive nor lose any money

Liverpool winning is still my worst-case scenario, but I now only stand to lose $7.25 if they win.

This is now considered my exposure on the Market. Thus, my Cash Balance is now only $125.26 – $7.25 = $118.01 (see at top of screen).

Given my previous Cash Balance after Bet 2 was $111.86 I have released exposure by placing Bet 3 and I now have more to spend on other markets and/or bets as I wish. The Market has not yet settled so my Account Balance is still $125.26:

The Market settled on 5 February 2019 at 08:51 AEDT with the winning result of The Draw. Each of the three bets I placed were settled and itemised in my Account Statement:

The Draw left me with a profit/loss of $0. As such, I did not pay any commission and my Account Balance finished on the amount it started with: $125.26 AUD.

Bet Balance

Your ‘Available to bet’ or ‘Total available’ balance is the amount available for you to wager at any given time.

Your ‘Available to bet’ balance is your account balance, minus the (current) exposure associated with any bets you have placed that have not yet been settled.

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