Fixed Odds vs Spread Betting

As the name suggests, fixed odds betting is 'fixed' - you will always know before you place the bet the possible outcomes, and how much you stand to win or lose. Spread betting is very different - you may lose a lot, win a lot, or win or lose a little depending on how accurate the prediction is in addition to its correctness.

To the less astute, recreational punter, fixed odds betting is the most viable of the two methods. You can only lose the amount that you bet. The case is much different for spread betting, and sports betting money management systems are commonplace for even the most professional spread bettor.

Financial spread betting and sports spread betting carries the potential for much greater rewards, but also involves larger risk than fixed odds betting. This is precisely why it lends itself much more to the astute betting professional as money can be made by those with the patience to research and find the right spread.

Fixed odds betting is, in principle, quite simple, and widely available through online betting sites. In this respect, an Internet bookmaker has more flexibility, and can change a price to manage the projected liability. Fixed odds betting dates well back before the invention of the Internet to the late 19th century, in which newspapers began offering fixed prizes for the correct predictions of outcomes of games.

The term is somewhat less applicable to online sports betting today as the odds are not necessarily fixed. In the pre-Internet days, if a misprint was made in the newspaper the odds could not be changed; the reprinting process was too expensive and a bookmaker was consequently unable to alter a price in response to customer demand. A standard UK online betting site these days offering odds on the English Premiership can dynamically change their odds, although this rarely happens pre-match unless news impacting the game is released.

There are several ways in which fixed odds may be presented, two of which are most common at English sports betting sites. Odds such as 4/1, called fractional odds, imply that for every one unit laid, four units in addition to the one laid will be returned if the bet wins. Another form of presenting the odds is in decimal fashion - 4/1 becomes 4+1=5.00; 10/11 becomes 1.91 (10/11 + 1 = 1.9090...).

Opening a fixed odds financial betting account is very easy and very little money is needed to open an account. Also, you can make profits even if a stock is trading sideways by using a range bet. Some consider fixed odds betting as an inferior choice to spread betting but both have their uses; for instance with spread betting you can't trade when a stock is consolidating.

There are definite advantages that fixed odds betting possesses over spread betting and vice-versa involving risks and potential earnings. Betting casually is best done at fixed odds, whilst spread betting professionals take preference to the high-risk, but high-reward, alternative.

What is Fixed Odds Financial Betting?

'Fixed odds financial betting' is on one of the newest ways of playing the financial markets. In essence 'binary' or fixed odds financial betting involves making a bet in the belief that you think a financial instrument (a stock, index or currency) is going to go up or down from where it is now. You can also bet on the belief that an instrument will touch, reach or bounce off a certain point. There are a few more permutations but the basics are as simple as that.

Fixed odds financial betting strips away the need for understanding complicated financial instruments like options or derivatives. Fixed odds financial betting is basically a simple method of learning how to trade as well as a means of limiting the risk for more experienced traders.

Fixed odds financial betting and binary betting employ something called a digital option. Digital options pay-out if an event (such as the FTSE rising above a certain fixed value) happens.

When you make a fixed odds financial bet, you are entitled to receive a payout, which is a fixed from the time of purchase. This means from the moment you bet, you know exactly what your gains will be, and your potential losses (Exactly the same as traditional sports betting). So there will be no surprises, and no replicating Nick Leeson!.

In fact fixed odds financial betting offers further added piece of mind. Unlike traditional sports betting your bet will have a re-sell value. This means that in most cases (certain conditions apply) you can sell back your bet before its expiry date, allowing you to take some of your profits early. The re-sell value of a bet will be anything between 0 (your bet has expired and you have lost) and the full value of the win.

Fixed odds financial betting is also unique in that you are required to state how much you want to win first. The fixed odds company will the calculate how much you will have to bet to win that amount if the conditions of your prediction become true.

What is the difference between fixed odds financial betting and financial spread betting?

Take this simple analogy: Imagine you could bet on a horse race that's already underway, it has a field of over a thousand horses and has been going on for over a hundred years. Let's say that you have information that a particular horse will suddenly turn lame and drop back. Imagine that you then place a bet that the horse will go lower in the field. That bet will reward you with one point, or one multiple of your bet, for every position your horse drops. You bet £10 per point that the horse will drop back and the horse drops back 100 places. Imagine making £1000 tax free in a few hours through the click of a button. This is the reality of successful financial spread betting. The main difference between fixed odds financial betting and financial spread betting is the fact that you are not limited by simple odds. What you are doing is predicting the direction a certain financial item will go from its present point. The more it goes in the direction you predicted, the more money you make.

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