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Placing a Betfair SP bet
Exchange bets which are unmatched at the 'off'
Bet persistence (the ‘keep’ option)
Adjustments to SP bets for non-runners

  Introduction

Betfair’s Starting Price (‘SP’ or ‘Betfair SP’) is calculated by balancing all SP bets and Exchange bets when the market is suspended at the ‘off’ of the relevant event. An SP bet cannot be cancelled once it has been placed.

A bet at Betfair SP is a fixed odds bet, with the odds on each selection being calculated and bets matched when the event starts. The odds are calculated by matching SP backers and Exchange backers against SP layers and Exchange layers. The inclusion of Exchange bets in the SP reconciliation is necessary to ensure that: SP backers get the benefit of unmatched Exchange offers to lay if those offers could increase the SP; and SP layers get the benefit of unmatched Exchange offers to back if those offers could reduce the SP. Including unmatched Exchange offers in the SP reconciliation also ensures that the bets of Exchange backers and layers, which would otherwise lapse, are matched where possible.

Example 1: on selection A there are £1,000 of backers’ stakes and £6,000 of layers’ liabilities at Betfair SP and there are £500 of unmatched Exchange back bets available to lay at an average of 5.0.  If we ignored the Exchange market in this case the SP would be 7.0. However this would leave Exchange back bets, that could also have been matched at their requested price against SP layers, unmatched. Therefore the Betfair SP will be 5.0 and all SP backers and SP layers will be matched at that price. The £500 of Exchange backers’ stakes will also be matched at their requested price of 5.0 against the SP layers.

Example 2: on selection B there are £831 of backers’ stakes and £4,428 of layers’ liabilities at Betfair SP and the following unmatched Exchange lay bets, available to back: £20 at 6.8, £31.13 at 6.6 and £100 at 6.4. In this case the Betfair SP will be 6.68. This is calculated by including the £20 available to back at 6.8 and the £31.13 available to back at 6.6 and balancing those amounts against the SP backers’ stakes and SP layers’ liabilities. The £100 available to back on the Exchange at 6.4 remains unmatched as to include any of this amount would lead to an imbalance between SP backers and SP layers.

The party against whom you are betting when you take the SP option is consistent with the main Terms and Conditions that govern your use of the site. For example if you are a UK based customer then any SP bet you place will be matched against another customer(s), but if you are an Australian based customer betting on a non-Australian event, then your counterparty is Betfair.

If for whatever reason the site is unavailable when an event starts, Betfair will determine the SP using all available information. For the avoidance of doubt this information will not be limited to betting activity on the relevant Betfair market(s). The Betfair personnel involved in determining the SP in such circumstances will have no undeclared personal or other interest in the SP in question.

If the SP reconciliation process is undertaken prematurely (for example if a horserace is turned in-play in error), then Betfair will endeavour to reverse the reconciliation so that the SP is determined when the event actually starts. There may however be circumstances in which this is not possible, in which case the SP will be based on the initial reconciliation.

If the SP reconciliation process is undertaken later than scheduled (i.e. after the event has started) and Betfair determines that a material event has occurred, the SP will be determined based on SP bets only, placed before the ‘off’. SP bets placed after the ‘off’ will be voided. However, if the SP reconciliation process is undertaken later than scheduled but Betfair determines that no material event has occurred, all bets will stand.

Placing a Betfair SP bet

Selecting the ‘SP’ button in the market view gives customers two different ways to request an SP bet. These are as follows:

  • The first way to request a bet at SP is by leaving the ‘Set SP odds limit’ box unticked at the top right of the bet manager. For a back bet you are required to enter the stake you wish to bet on the selection. For a lay bet you are required to enter the liability you are prepared to risk against the selection – in other words the amount that you are prepared to lose, should the selection win (or be placed as applicable).
  • The second way to request a bet at SP is to select the ‘Set SP odds limit’ option. Using this you can request a bet at SP conditional upon minimum SP odds in the case of a back bet, or maximum SP odds in the case of a lay bet. If Betfair’s SP is shorter than the minimum price requested by a backer or is longer than the maximum price requested by a layer, then the relevant bet will lapse when the event starts. If Betfair’s SP is longer than the minimum price requested by a backer or is shorter than the maximum price requested by a layer, the bet will be matched at the SP. Where an SP is equal to the minimum or maximum SP price limit specified by customers and as part of the SP reconciliation only part of the those requested stakes (or liabilities in the case of SP lay bets) can be included, bets will be included based on the time they were submitted, on a first come, first served basis as is the existing convention for Exchange bets.
If an SP bet with an odds limit is requested, the minimum/maximum odds requested can be shortened in the case of a back bet or a lengthened in the case of a lay bet at any time before the event starts. However, as mentioned above, an SP bet request cannot actually be cancelled by a customer once it has been placed. Details of the impact of non-runners on the Betfair SP are provided below.

Exchange bets which are unmatched at the ‘off’

An Exchange bet is a normal bet placed by choosing the odds of your selection from the market view (as opposed to clicking on the ‘SP’ of your selection). When an Exchange bet is fully or partially unmatched it can be adjusted and cancelled in the normal course. Before now, unmatched bets were automatically cancelled when a market was suspended at the ‘off’ of the relevant event. You can now choose to either have your unmatched Exchange bet convert to an SP bet when the market suspends at the start of the event, or to have the bet ‘persist’ when the event goes in-play (see the ‘keep’ option below).

In order to convert your unmatched Exchange bet to an SP bet when the market suspends you should select the ‘At In-Play: Take SP’ option in the bet manager. If there is a non-runner in a win market with a reduction factor of at least 2.5%, or a non-runner in a place market with a reduction factor of at least 4%, it is Betfair’s policy to cancel unmatched lay bets on all other runners in the market. In the case of any such non-runner, a lay bet for which the ‘At In-Play: Take SP’ option has been selected, will automatically convert to an SP bet. After this conversion the bet cannot be cancelled. Otherwise, unlike an SP bet, you can choose to cancel an Exchange bet once it has been placed, even if you have chosen for the bet to persist or to convert to an SP bet at the start of the event. 

If you choose to convert an unmatched Exchange lay bet to an SP bet, the liability of your Exchange lay bet will be converted into a liability for the SP bet. Your liability for that SP bet will never be more than the liability for the Exchange bet you had specified. However, the amount you can win on the SP lay bet will differ from the amount you would have won had the Exchange bet been matched, depending on the final SP.

Bet persistence (the ‘keep’ option)

For markets that are scheduled to be turned in-play at the ‘off’, a customer can request that an unmatched Exchange bet should not be cancelled when the market is turned in-play. This is done by selecting the ‘At In-Play: Keep’ option in the bet manager and means that the unmatched bet persists when other unmatched bets are cancelled at the start of the event.

As described above, when a non-runner is removed from a horseracing market it is Betfair’s policy to cancel unmatched offers to lay all other horses in the market if the non-runner has a reduction factor of 2.5% or greater for win markets, or 4.0% or greater for place markets. In these circumstances offers to lay a horse with the ‘At In-Play: Keep’ option selected will not be cancelled. Instead the lay odds offered or requested in place markets will be reduced in proportion with the reduction factors of any non-runner(s) and the same will apply in win markets providing the relevant non-runner has a reduction factor of at least 2.5%.

For the avoidance of doubt this means that (for example) when a material event occurs in a soccer match and other unmatched bets are cancelled before the market is reopened, a ‘keep’ bet will not be cancelled.Please also note that for horseracing markets reduction factors are not applied to ‘keep’ bets which are matched in-play.  In the event of a late withdrawal, Betfair reserves the right to remove the runner after completion of the race.  In this case any ‘keep’ bet placed before the off and matched in-play will remain at the original selected price and will not be adjusted or cancelled as would be the case if the non-runner were removed pre-race.

Adjustments to SP bets for non-runners

For SP back bets, Betfair will at no point amend either the stake or the odds requested by a customer, despite any non-runners or withdrawals. However in all cases customers can reduce the minimum SP odds they are prepared to accept on a selection.

For SP lay bets on win markets, Betfair will reduce a customer’s liability based on the reduction factor(s) of any non-runner(s) and the reduction factor of the runner on which the customer’s bet has been placed. This is to ensure that the balance between the backers’ stakes and the layers’ liability reflects the revised market after the runner has been removed. For example if a horse with a 50% reduction factor becomes a non-runner, then another horse in the same market priced at about 5 (i.e. a reduction factor of 20%) will change to a price of about 2.5. Therefore the liability on a £200 lay bet on that runner will need to change to a liability of about £75 to ensure that a balancing back bet will have the same £50 stake. This is done by multiplying the liability by 100%-(50%/(100%-20%)) = 37.5%.

Where the lay bet has a maximum odds limit specified, this limit will be reduced by the reduction factor of the non-runner, if the non-runner has a reduction factor of at least 2.5%.

For SP lay bets on place markets, Betfair will still reduce a customer’s liability based on the reduction factor(s) of any non-runner(s) but the calculation will be slightly different, in line with the application of place reduction factors. The liability will be reduced by the reduction factor of the removed runner. Where the lay bet on a place market has a maximum odds limit specified, the potential winnings on the bet (i.e. the odds – 1) will be reduced by the reduction factor of the removed runner.

Note that SP lay bets will not be cancelled when there is a non-runner.

 


 
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