Closing out
One of the main differences with spread
betting as compared to other forms of betting is the
possibility to “close out” your bet at any
point while the market is open. This can work with both
buying and selling bets.
Another unique feature of spread betting is that it
allows the bettor to trade ‘in running’,
meaning that anyone who wishes to place a spread bet
may do so while the event is in progress. This effectively
allows a bettor to delay the completion of a bet until
play has actually started, giving them a chance to reflect
on the variables and question whether it is wise to
bet at all on this particular occasion.
Let’s look again at the instance of a test innings
by Australia, where the spread is quoted as Australia,
first innings runs 300-320.
For instance, say you start by buying a bet £1
that Australia will achieve more than 320 runs. The
opening partnership is still in place and tearing their
way up towards 200. The spread would be likely to rise,
as the original target begins to look very achievable.
If the spread rose to 340 – 370, you would be
able to sell a £1 bet at 340. This would then
leave you with a profit of £20 at settlement,
which is also know as the ‘make-up’ of a
market.
Conversely, at the start of the match, say you sold
a £1 bet that Australia will achieve less than
300 runs. Early on, the batting side lose a number of
quick runs and that total looks very ambitious. The
spread would be reduced, say to 250 – 270. You
could close out your position by making an opposite
bet to your first one, or in other words, buying a £1
bet at the market price, which would be 270. At the
time of make up, you would be left with a profit of
£30.
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