For a little side note away from betting markets today, we wanted to take a brief look at Each Way betting. This is a popular method of trying to give yourself coverage on a selection, in particular horse racing, because you are willing to sacrifice greater odds for the higher possibility of receiving some kind of payout. Each Way bets are split up in to two bets; one Win and one Place bet. For example, if you back wonder horse Frankel in an Each Way bet at 4/1 Odds and ¼ Odds for a Place (1st, 2nd & 3rd) for example, what does this mean in terms of payout and return? Well, because you are placing two bets when you make an Each Way selection, you need to double your initial unit stake. So if you were having a £10 each way on Frankel winning the 3:10 then you would actually be staking £20 (two bets of £10). As far as returns go, if Frankel romped home first as expected, then you would win both of your bets. You would naturally get your full return on a win at 4/1 of £40, but you can add on top of that, another £10 profit for the Place bet won at Evens (which is a quarter odds of 4/1) as well. However, what makes Each Way betting appealing, is the coverage that you will get if your horse simply Places. In this example you would not get any profit from your Each Way bet, because while you would be winning the £10 from your horse placing at quarter of the original odds, and that will simply serve to cover the lost £10 stake of the losing Win part of the bet. It doesn’t matter if you bet £1 or £100 on a 4/1 selection at ¼ Place odds, a Place finish is not going to offer any profit. So while you are not going to come out with anything, you at least don’t lose your stake, which you would have done if you had taken a £10 bet on the nose for Frankel.
Naturally, the greater the odds over 4/1 that your selection is for an Each Way bet (which pays out at quarter odds) the greater the profit you will pick up for a Place finish. Anything under that threshold 4/1 odds in an Each Way bet will mean that you actually lose money if your horse only Place at ¼ odds. You will need to adjust your odds range slightly if for example the Place Market paid out at 1/5 odds, because then the minimum odds you need to take where you would at least get your stake back would be 5/1. For 1/3 Place odds, you need the threshold of 3/1 odds and so on. So, if the odds in the Frankel example above were at 8/1, then you would make yourself a £10 profit for him Placing. This is because a £10 stake at 2/1 (a quarter odds of 8/1) would give you a £20 profit, but half of that would still go and cover the losing Win part of your initial Each Way bet. But at least you would walk away with something. So that is the appeal of an Each Way bet, and it is really, strategically reserved for punters wanting a crack on a longer shot in a market. There is really little value in backing one of the front runners in a race in an Each Way bet. But if you spot someone in the field who has at worst an outside shot and landing a Place finish, but could also spring a huge surprise and win, then that is the kind of selection that you want to back. This is because it will be at higher odds and therefore a better pay out on a Place finish.
But what about an alternative? An alternative to Each Way bets. Well, not really an alternative, but an expanded way to increase the potential return of your profit in an Each Way bet, but without losing any stake again if your selection Places. We shall explain, after all, successful betting is about maximum potential for lowest amount of risk.
Let’s look at example of backing a 8/1 horse at £10 each way in a race (with Places paying out at ¼ odds). With a win you know that you will make a £100 profit. However, you also know that you will get £10 profit on your Each Way bet if the horse only Places. So here is where you can capitalise without losing any stake. You can take that £10 insurance that you’ll have if your Each Way bet Places and simply stake the equivalent of that £10 on your horse to win in a separate single bet. At this stage you are paying out £30 in total stake, but the pay off here is if your horse does win, because you will get the £100 profit from your Each Way bet, plus a further £80 from your single. If you horse just managed to place in this scenario, then you have still not technically lost anything. Why? Because with a Place finish, you would get your £10 back from your Each Way bet, which covers your stake on the single, so that was almost like a free bet. You just didn’t get that £10 profit from the each way bet, but you haven’t lost any original stake. You still get your initial £20 stake back which you laid out for your Each Way bet, but that losing separate single will have been covered by the profit from the Place in the Each Way. So essentially with this free bet you can almost double your winnings by taking this approach.
So in summary. If you can open up a profit margin by a selection Placing, then you can use that profit margin essentially as a free bet as a separate single, to try and boost your winnings.
Just to recap this expanded Each Way Bet system
£10 Each Way at 8/1 (with ¼ Place Odds)
= a) £100 profit for a win
= b) £10 Profit for a Place
Now take b) and place that same value on separate single bet on the same selection, which leads us to:
Separate £10 Single Win at 8/1
= £80 profit for a win
= If the selection only places the £10 stake which would be lost here, would be compensated for by the £10 profit of the Each Way profit of £10 (b). So it is essentially a free bet as you don’t lose any stake.
