If you work in financial markets such as stocks and shares, you’ll probably be well aware of the concept of point spreads.
Essentially it means you gamble on the movement of the market rather than the possibility of a particular price that you want to buy or sell at. In stocks and shares, this means anticipating whether a range of outcomes are going to happen and it means understanding the market closely.
This is something that is very popular in sport’s betting. Instead of betting on one team winning, you may want to be nuanced in your approach. In cricket, that could be a team scoring below or above a certain number of runs.
In financial markets it’s called long and short betting – if you think a particular stock is going to rise or fall, you can bet on those outcomes. When you get it right, you make money, and when you get it wrong, you lose. You can also make more money if you get it ‘very right’ or lose more if you get it ‘very wrong’.
The Point Spread: What is it?
Essentially, you considering a range of outcomes and your bet is whether the final result comes below or above that when the event is over. Let’s take the Rider Cup. America are fielding a particularly strong team and Europe is weak. The spread bet would be on how much the US team are likely to win by. The spread could be that they will have a 15-13 lead by the end of the final day. Your points spread bet will be whether that win margin will be greater or smaller.
If you’re looking at a game like American Football, a points spread would on be a particular team winning or losing by a certain amount. This could be shown as a plus or minus against each team in the betting information. For example, if you have The New England Patriots playing the Dallas Cowboys, the spread could be +6 for the Patriots and -6 for the Cowboys. The amount of the spread will usually indicate how much one team is favoured over the other. Your bet is that one of two things is going to happen – either the Cowboys are going to lose by six points or more or they’re going to lose by 5 points or less. That means your team can lose but you can still win the bet if you pick the right option.
Spread betting has been around for quite a while and has become a lot more popular since the advent of online services. In the UK, it began around 1980 when companies were looking for something more nuanced than fixed odds betting (where you bet on a win or lose, rather than betting on the margin).
Point spread betting allows betting companies to offer a range of options to the average punter. For example, in a tennis match it could be how many games a player is likely to win or the total number of games that are won by both players. If you bet under or over the bookies estimate, you can get paid according to ‘how right you are’ when the final result comes in.
Another example from a cricket match could follow this kind of scenario: Your team isn’t doing very well and the middle order has a few form problems. The spread for batsman number 3 is that they’ll score between 48 and 52 runs.
You think with the strength of the opposition’s bowling attack that the player will struggle and opt to go for the lower option, choosing to bet £2 per run below 48. The batsman is bowled out for just 10. That means you are 38 runs below the spread. Multiply that by your £2 and you get a win of £76.