When you place a bet, you are entering an agreement with your bookmaker of choice. The agreement is akin to a contract and it is ‘signed’ between the specific bookie and the person that placed the bet. As a result of this, you are not allowed to sell your bet as this would be seen as you effectively breaking your contract.
On top of that, the bookmaker does not have an agreement with the person that you have sold the bet to, which will put you in breach of the contract that you agreed to. That is the simplistic way of looking at it.
There is, of course, a much more complicated way of thinking about the bet that you’ve placed and whether or not you’re entitled to sell it, or buy a bet that someone else has placed. When you choose to Cash Out a bet, you are effectively selling it back to the company that you placed it with.
Equally, those that use exchanges can ‘Lay’ a bet to someone else (in the same way a conventional bookie does when you back a bet), which is akin to buying it from them. You can also inherit a betting account, which might well have ante-post bets that haven’t settled yet. This isn’t the same as buying them, but it’s not far off.
What The Rules Say
In the vast majority of cases, bookmakers have terms and conditions that you agree to when you open an account that specifically forbid the account being used by anyone else. Betting companies have know who it is that they’re dealing with because of the Know Your Customer rules that they agree to when they receive a licence to operate from the United Kingdom Gambling Commission. One of the conditions of the small print in a bookie’s terms and conditions is the idea that they know who you are and where your money comes from.
This doesn’t mean that they need to see your tax returns or anything. Instead, it’s important for them to have a sense of where your money comes from so that you can’t use your account in order to launder money. If you were to sell your bet to someone else then the betting company would have no idea where the winnings were going, should there be any. This means that they would be in violation of the licence that they were given by the UKGC, which is obviously hugely problematic for them moving forward.
Obviously we’re specifically looking at people that want to sell their bets here, but the same terms and conditions make it impossible for someone to legally buy a bet from someone else. If you approached someone and asked them if you could buy a bet that they had placed and they agreed to sell it to you, you would be the person that the betting company knew nothing about and would therefore be violating their Ts & Cs. It’s the same principle, just approached from a different angle that leaves you exposed.
It might seem strange not to be able to buy someone else’s bet, on account of the fact that the world of finance allows this sort of thing to happen all the time. You can buy someone’s risk in the world of finance, such as taking on their mortgage. This is, of course, part of what led to the financial crash of 2008 and is therefore not exactly a brilliant example of how things work in a different field. Even so, it is an interesting comparison that is worth mentioning, given the monetary links and the risk involved in both gambling and finance.
Other Options
In 2004, Mark Cuban wrote a blog in which he suggested that sports betting hedge funds could operate in a similar manner to other hedge funds. Having spent a decade and a half betting on long and short stocks, Cuban knew what it took to make money from different areas of the finance world.
A few years later a company called Centaur Galileo got involved with the idea, believing that they could see a return of between 15% and 25%. Sadly, the company failed in its endeavour and collapsed in 2012, having lost in excess of $2.5 million.
Even so, sports hedge funds are technically a way of buying someone else’s bet, albeit wrapped up in the world of funds in order to make it seem more complicated than it actually is.
In Las Vegas, the idea of buying someone else’s bet has been going on for years. As a result of this, a company called PropSwap launched and allowed people to buy and sell bets, taking a 10% commission for the pleasure of doing so. Whether this idea would work in Europe is a different matter, given that Americans tend to be remarkably risk-averse.
Betting Shops & Racecourses
One thing that is worth acknowledging at this stage is the fact that we’re specifically talking about bets placed online as far as this conversation is concerned. The reality is that things are entirely different when it comes to wagers that are placed in betting shops or on racecourses.
Whilst the terms and conditions might technically be the same, the truth is that bets placed in a betting shop or with an on-course bookie don’t require any proof of identity. The same person that placed the bet doesn’t need to be the same person that collects a payout.
If you were so inclined, you could look to find someone on a racecourse that had placed a bet that you want to buy and offer them a chunk of money for the bet. As long as you don’t do it right in front of the bookmaker that the wager was placed with, the likelihood is that there will be nothing stopping you from collecting any winnings if the bet proves to be a successful one.
The seller might well be grateful to have made a guaranteed profit on their bet without having to take on the risk of watching to see it develop and find out if it actually would have been a winner or not.
Why You Would Want To Sell Or Buy
The obvious question when it comes to this topic is why, exactly, someone would want to sell their bet or why someone else would want to buy a wager. The former question can be answered on account of the risk involved with betting.
The second that you place a wager, even if it is on something that is as good as guaranteed to take place, you face a level of risk. The initial money that you put down might be lost if something goes wrong on your bet, so the chance to sell your risk for a guaranteed profit can be too much for some to resist.
The people buying the bet can have all sorts of reasons for wanting to do so, but the most obviously is that they are unable to place bets of their own for some reason.
In most cases, the bettors will have been successful with the wagers that they’ve placed in the past, which will have led to the company that they chose to place bets with banning them from doing so in the future. As a result, the only way that they can get a wager of their own is by buying one from someone else, thereby taking on the risk of the bet.
Cashing Out
Whilst it is impossible to buy someone else’s bet by using the Cash Out function offered by most bookmakers, it is possible for punters to effectively sell their own bets back to the bookie that they placed it with by Cashing Out.
The Cash Out option provided by most bookmakers is essentially them buying your bet from you, given that you give up the risk in exchange for either a guaranteed profit or else a minor loss. It is a win-win in many ways, given that you know you’ll get some money back and the bookies know how much they’ll lose.
Of course, taking a bookmaker up on their Cash Out option isn’t the best thing to do. By Cashing Out a bet, you are essentially allowing a bookie to take twice the Edge that they normally would. A bookmaker doesn’t offer you fair odds when the initially offer them to you, building in their own Edge into the odds.
When they offer you a Cash Out price, they build another Edge into the price, thereby ensuring they make double the profit. You might be selling your risk, but what price are you paying in order to be able to do so?
Betting On The Exchange
Exchange betting works by effectively allowing you to play the part of the bookmaker. You can offer odds on the outcome of an event and see if anyone is willing to take you up on those odds.
When you Lay on an exchange, you are giving someone else odds and taking their money in exchange for that, effectively buying their bet. It is clear that this is not the same as actually paying someone for the precise bet that they’ve placed with a bookmaker, but it isn’t too far off that and so is worth mentioning as part of this article.
Exchange betting is more complicated than traditional fixed-odds betting, so it’s worth bearing that in mind before you leap onto an exchange site in order to go through the process of buying someone’s bet from them.
Always ensure that you understand what it is that you’re doing and that you have it clear in your head before you actually do it. You’re not buying someone’s bet in the straightforward sense and the amount that you could lose is more than it would be if you simply offered someone a set amount of money to buy their wager from them.
Inheriting A Betting Account
When it comes to the contract agreed between a bookmaker and a bettor, the contract works both ways. When you place a bet, you are effectively saying that you expect to be paid out if your wager is a losing one.
The contract in place ensure that someone that has died can pass on their bets in their will, meaning that someone else can claim the winnings in the event that their ante-post wagers turn out to be winning ones. It goes without saying that this is not the same as selling your bet to someone else or buying a bet, of course.
That being said, it is still effectively the same thing. You are taking a bet that belonged to someone else or you are giving your bet to another person, albeit after you have shuffled off this mortal coil.
It is clearly an extreme way of obtaining a bet or of giving your bet to someone else so it is not one that would be recommended. It is just interesting to note that it is a way that it can happen in the case of some bookies. Some companies, of course, might have something in their terms and conditions that rules this out as a possibility.
Trading Out A Bet
Another example that isn’t technically selling a bet in the way that we clearly meant at the start of this piece comes in the form of trading out on a bet. This is the process of placing a bet on the opposite outcome of the one that you placed originally, effectively betting against yourself.
If you do this successfully then you can not only reduce your exposure but, in certain circumstances, lock-in a return before the event that you’ve been betting on has even reached its conclusion. There are sites out that that offer you hedging calculators.
These calculators ask you how much you bet and what odds you bet at, as well as giving you the option to input what the Lay odds are and how much commission you need to pay.
They will then tell you how much you need to bet on the other outcome in order to either cover your potential losses or else guarantee a profit. This isn’t a long-term strategy, but it is a way of removing or reducing your risk in a manner that is akin to selling your bet to someone else for only a small profit.