Each way bets can provide good returns for matched bettors, though they are more complex than standard bets and involve some unique risks. Please ensure you have fully read the Basics and Risks tutorial before continuing.
There are two primary ways of making profits with each way bets.
Each way bets can often be employed to set up arbs (or arbitrage bets). These are bets that result in a profit regardless of outcome. This is a popular way of generating profits from gubbed bookie accounts.
The reason that each way bets are useful in setting up arbs relates to the different ways that bookies and exchanges treat each way bets. Bookies derive the to place odds of an each way bet from the horse’s to win odds, so the two values are always linked. Exchanges, on the other hand, simply have two separate and unlinked markets for the two bets. As a result of this, the to place part of an each way bet can sometimes be laid at significantly lower odds on the exchange than it is backed at with the bookie.
Because the odds for to place bets are generated in different ways by bookies and exchanges, it is also possible that arbs set up in this way are less likely to be flagged by bookies, though this cannot be confirmed.
Bookies sometimes offer to pay out additional places on each way bets on specific races. Because exchange markets will still pay out only the standard places for these races, it is possible to have a situation where both the back and lay bets win.
For example, consider the following situation:
- A bookie offers to pay four places rather than the usual three on a 9 horse race.
- The bookie will now pay out on the to place part of each way bets if the horse places in the top four.
- The exchange will still only pay out on the to place market if the horse places in the top three.
- We place a matched each way bet on a horse.
- If the horse finishes in the first three, in fifth, or lower than that, we make a qualifying loss or arb as usual.
- However, if the horse finishes fourth, then the to place back bet with the bookie wins and so does the to place lay bet on the exchange.
Although large profits can be made when extra place bets come in, it is important to always be aware and cautious of the effect that non-runners can have on each way matched bets. This can result in both back and lay bets losing, as described in the Basics and Risks tutorial.