Difference in reduction factors turned expected profit to loss

I backed a horse for £20 at 10.00 odds at Unibet and laid it on the Betfair Exchange at 9.20. I was due £1.33 profit. A horse was subsequently withdrawn (not the one I was betting on) and reduction factors were applied. However, the reduction factor at Unibet was 0.135 (it was listed as 0.15, but I calculated it to be actually 0.135), and the reduction factor at BE was smaller at 0.12. The horse went on to win the race and because of the difference in reduction factors I ended up making a net *loss* of £2.37 (my back bet paid out at £20 x 8.65 odds = £173, less my £20 stake = £153, whilst my lay loss was £21.79 x 8.13 odds = £155.37).

My question is: why weren’t the reduction factors the same? If it is the case that they are not regularly the same then this opens us up to an element of risk-taking that I wasn’t aware of. Thanks in advance for any clarity you can offer on this.

+0

Aeneas
2

July 12, 2022 at 3:57 am

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Matt
Keymaster
1490 July 12, 2022 at 10:17 am

In the event of non-runners, bookmakers will apply ‘Rule 4’ deductions to the odds of remaining horses. The deductions are a set amount, depending on the odds of the withdrawn horse.

Most bookmakers apply the same reductions; however, a few vary. Your odds of 9/1 (10.00) have been reduced by 15%. Looking at Unibet’s table of deductions, the withdrawn horse must have been priced somewhere between 5.01 and 6.50.

Betfair apply non-runner deductions to Exchange bets a little differently. Instead of applying set deductions to odds ranges like traditional bookmakers, they use the following formula…

(Decimal odds / 100) x reduction factor of non-runner = amount to reduce the original price by

As you’ve discovered with your bets, the difference in deductions can sometimes lead to a small loss. It can sometimes work the other way, though, so it’s just part and parcel of betting on the horses.

I hope that helps.

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Neil S 76 October 31, 2022 at 2:32 pm

I’ve just had another experience like this, only this time it worked in my favour. I backed Princess T in the 1400 Hereford for £15 at 5.5 with BetUK (in order to qualify for a £3 free bet). My lay bet was at 5.4 with Smarkets (0% commission, courtesy MBB deal), so an expected QL of 35p.

Two non-runners ensued, and Princess T went on to win the race in style. Rule 4 applied to my BetUK bet, with odds reduced from 5.5 to 5.05, meaning I won £60.75 instead of £65.00. At this point I was concerned I’d be £4.60 down on the deal, with only a £3 free bet to compensate. But then I saw that the odds applied by Smarkets had been reduced from 5.4 to 4.32, so my liability was massively reduced – from £67.85 to £51.19.

Result – profit of £9.56 and a free bet to boot!

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Stuart123 8 October 31, 2022 at 5:00 pm

It’s great when that happens!

I had a similar experience today too. I placed at £10 bet on Atakan in the 13.45 at Plumpton with Sky Bet to make a 48p profit with a price boost as there was only around £13 in the exchange. Rule 4 was applied and I ended up with a £2.60 profit! The bet contributed to the Sky bet club to get a £5 free bet for staking £30 in bets in a week too.

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