Golf Editorial

20130116 Back-To-Lay Strategy Explained

For beginners only

I emphasise this first thesis is for neophytes. If you’re an experienced and knowledgeable exchange gambler there will be nothing in the information that follows that’s going to be a newsflash for you.


Firstly, let’s get our terminology straight, so we’re all on the same page:


The amount of money you outlay when you make a bet (aka a wager).


To Back is to place a bet. Backing is outlaying funds on an outcome where somebody else is risking that you might win.


To Lay is to accept a bet. Laying is the opposite of backing. When you lay you are accepting somebody else’s bet; taking on the risk that he might win.

Price vs Odds

Let’s assume the odds are 100/1 (one hundred to one). This means that the bookmaker believes this golfer has one chance in 100 of winning.

If you bet at these odds, this means you will win 100 for each unit you stake because a successful stake of one unit will give you a payout of 101 units – your stake back plus your winnings – a profit of 100.

Modern bookmakers convert odds to a decimal price, for reasons of user simplicity. The reason for this decimal simplicity becomes more compelling when the odds are slightly more complex. For example, take 9/2 (a price of 5.50) and imagine you’re staking an odd amount, say 6.70.

Under a decimal pricing system the payout is an easily calculable 5.50 x 6.70 = 36.85. And 36.85 – 6.70 = a profit of 30.15

So, and with apologies to traditionalist bookmakers who can easily argue the exact opposite of what I’ve just written, I’ll only refer to prices and not odds henceforth.

Now, if you do not have the above wagering terminology crystal clear in your mind, then read no further. Go away and do the necessary study and come back once you’re up to speed on the jargon and the basics. Go to Betfair and play around with backs and lays & its tutorials; it helps.

What is back-to-lay?

Back-to-lay is a betting strategy that can only be used with betting organisations where you can both back & lay; a betting exchange. The biggest exchange, and therefore the one with the most participants and liquidity, is Betfair and that the next biggest is Betdaq.

Employing back-to-lay, your objective is to back a golfer, usually but not necessarily before the event tees off, with the intention of laying him (aka laying back or laying off or even getting out completely) at a shorter (smaller) price during the tournament.

Simplistically, if you can back him at 30.00 prior to tee-off and then lay him at 15.00 sometime during the tournament you will double your original stake.

There are commissions, typically up to 5%, attached to the profitability of each transaction, but let’s ignore them for now to keep the discussion simple. Remember this is ‘Back-to-Lay 101’ and there is a more advanced discourse to come.

Let’s flesh out this specific back (30.00) and lay (15.00) with some details

Let’s imagine you wager 100.00 on a guy paying 30.00 so the payout if he wins will be 3,000.00; a profit of 2970.00

If you subsequently lay him at 15.00, say after round 2, you can lay (accept stakes totalling) up to 200.00 for a payout of 3,000.00 without exposing yourself to any risk. This is nice!

Once the lay transaction is completed you have zero profit or loss on both your original bet and your lay because:

  •         If he wins, you collect 3,000 from your bet but you pay out 3,000 on your lay and;
  •         If he doesn’t win, you collect zero from your bet and pay out zero on your lay.

However, and this is the guts of the strategy, remember your original outlay was 100.00 and you’ve received income of 200.00 so you no longer care how your golfer performs in rounds three or four; your profit is locked in.

But what if he wins? I hear you ask

This is typical gambler thinking. Why would I do any laying and lock in a measly 100.00 profit when he’s going along nicely and I can sit back and if he wins it I’ll collect a cool $3,000?

There is nothing wrong with this; it’s called having a bet and nobody’s got a problem with that except maybe the wife, the bank manager, the religious freaks and the social engineers. AND the person committed to a back-to-lay strategy! Back-to-Lay experts are far closer to being venture capitalists or investors than they are to being gamblers!

However, if you’re a typical golf gambler, and therefore a person who loses money most years, and you have a passing interest in back-to-lay I urge you to think about this from two perspectives:

i) Who do you think typically makes more money each year, the gamblers or the betting organisations? If you agree with me that it’s the latter in 95% of instances then you’ll also agree that laying should be at least considered as a part of your golf betting tactics and;

ii) In the above instance, we are not really talking about a 100.00 profit. We are talking about a 100% profit, doubling your money. In a few days! Or hours!

And I should add that the profit is not limited to 100%; For example I backed a guy at 1001.00 recently and laid him off at an average price of 50.00 Though I invested only 25.00 I got back nearly 500.00 – twenty times my investment. A 2000% profit!

But what if he plays like a dog and misses the cut? I hear you ask

Well, that’s easy. You lose your money. This is going to happen quite often, so you know you have to either accept its inevitability or not bet at all.

The Emotional Aspect

Laying is not easy for beginners betting on golf, or indeed investing in equities; the emotions are similar. Especially the remorse if the decision to quit an investment turns out, with the benefit of 20:20 hindsight, to have been premature or too late.

Have you ever bought shares for 1.50, happily sold at 2.00 and then got depressed watching the price rise to 3.00? Have you ever, as I did in 1986, bought shares at 1.60, watched them rise to 12.50 and then watched them dive to zero never to resurface? Thanks, Chase Corporation!

One key is thus to remove emotion from the equation and specifically to always think less about what might happen and more dispassionately about how you stand right now; because that’s the only thing that’s real.

Casinos try to keep you gambling by: not having clocks or windows, serving free drinks and even pumping ozone through the air conditioning system and it’s all designed to make you forget about time; to suspend reality and keep you gambling. Just as you need to overcome these ploys and control yourself in a casino environment, so you need to focus in on the here and now with your golf bets and lays. I’m not saying you ignore what might happen as that’s a factor in your considerations but it’s always less important than how you stand right now!

The foundation for the removal of emotion is that you must have a plan going in, specifically a price at which you’ll consider laying and which is intimately related to your target return on investment over the long haul. Just as when you enter a casino you have a bankroll in your pocket, and for the tragics an ATM card, there is a stop-loss for the venture.

Your plan helps to take subsequent in-play emotions out of play too – in the heat of battle, so to speak. It’s easy to watch a guy shoot 64 and convince yourself he’ll do it again tomorrow, but if you backed him at 30.00 and you can double your money by laying him now at 15.00 that’s a 100% profit while what might happen tomorrow is not real!

Is there a middle ground between not laying at all and trading out completely?

Of course, and it’s massive and exciting territory.

At some point there may be the opportunity to lay and get your original investment back, or an extra 10%, or a whole lot more. So, depending on your plan, in the above-described circumstances you might elect to take the opportunity to lay, say, 110.00 @ 15.00 so you have locked in a small profit but still own a nice win payout of $1,300 or so against which you can lay later.Or you might do nothing, sit tight and hope he improves further or even wins!

Maybe you do a partial lay and he then has a good 3rd round and shortens to 8.00 so you can lay some more while still keeping a healthy win payout on your radar.

Again, it depends on your plan. He may be as likely to have a bad 3rd round as a good one, so his price could lengthen to 75.00 in round three and by then you’re out of the trading game! So, at that point, when he’s blown it in round three, you can be in a position whereby you’ve locked in a big profit all the way down to facing a certain total loss – or anything in between!

Is there a Message emerging here?

Well, I hope so, and if you haven’t picked up on it yet then you probably shouldn’t bet! Or vote, reproduce or drive a vehicle! Just in case you’re wondering, the message is “HAVE A STRATEGY!”  And stick to it!


To help you towards the formulation of a strategy for when to lay or hold and how much, here are a few scenarios, among the thousands that could emerge. Your contemplation of them hopefully will be a helpful first step in formulating your strategy.


Let’s assume you wager 100.00 on a golfer at 51.00 He is the 16th favourite for the tournament and you rate him 41.00 to win it (more on pricing later). So, the 51.00 price is good; you purchased wholesale!

i) Let’s say he opens with 6 birdies in his first 9 holes to lead by 2 shots and his price is now 20.00 Do you do nothing or fully lay him and trade-out, more than doubling your investment or partially lay him and keep your options open for further improvement?

ii) If your decision is to lay, can you deal emotionally with trading out completely at 20.00 if he then keeps playing well over the next two days, shortens to a price of 6.00 during round 3 and goes on to win the tournament? After all, by laying you missed out on the 5,100 payout opportunity.

iii) Thirdly, can you deal emotionally with doing nothing after those 9 holes, expecting him to keep shooting birdies, and then watch him triple bogey the 10th, finish day one at a price of 75.00 then gradually drop down the leaderboard to finish T58?

iv) Let’s now examine an alternative performance pattern by our golfer.

In round 1 he shoots 2-under and is still priced at 51.00. Same in Rd2. At the end of Rd3 he’s 10th and four shots off the lead on a crowded leaderboard and paying 40.00.

Now it’s Sunday, you’re on the couch watching the golf with your laptop handy and as the last 9 holes loom he’s 4th, 3 shots off the leader and now paying 20.00.

As he walks to the 10th tee, and some would say the tournament is only now about to begin in earnest, do you wait and see if his improving trend continues and do nothing, or do you lay him for some $$ and keep your options open for further lays or trade out completely and more than double your investment?

Think about it!

What player(s) should I back-to-lay?

To move away from laying, and to wind up this first thesis let’s take a look at the part of the strategy that precedes the backing and laying. Choosing who to back-to-lay. Firstly, here are the impacting factors:

i) Price

The player’s price should be ‘overs’. In other words, you need to have access to your own realistic price set and you should only ever back a player when you can get a better price than yours. This is simple consumerism; every person wants quality service at a discounted price instead of paying full retail. So, if your reference price is 29.00 and the bookmaker is offering 29.00 that’s full retail. If you can get 34.00 or even 41.00 then you have your discount and you’re buying wholesale.

ii) Time

Following a tournament live is time-consuming, tiring and can be exceptionally irritating and even stressful. Do you have the time to spare? You can trade only after each round if you wish and that only takes a minute each day but in doing so you are shutting yourself out of all the price variances and associated profit opportunities that arise in-play.

Also, you want the maximum number of rounds to be available to maximise your lay opportunities. This suggests avoiding tournaments that are at risk of weather curtailment. Some would add, and I tend to agree, that three-round (or shorter) events should be avoided.

Time also impacts in the sense that it passes and thus brings ever closer an end to your guy’s chances. You need to always keep in mind whether there is sufficient time left for your strategy to succeed. In the above example, if your man bogeys the 10th on Sunday to drop 11 places and now 4 shots off the lead, you might judge that there is now insufficient time for him to win so you might trade out at his new price of 50.00 to preserve your capital and live to fight another day.

iii) Player profile for Back-to-Lay

You need to back players that have a chance of getting on the leaderboard during a tournament and who’ll get noticed for being there. I think of this as a golfer who can ‘make some noise’.

Incidentally, I’m not referring here to the SHIT DUMB CRAP 6-person leaderboards that dominate televised tournament coverage, but to that group of players in contention for the win that the backers and layers are monitoring – which extends right down to guys who may be as many as six shots off the lead with a round to play.

A guy who places high (Top3 or Top5) on occasion, in between mediocre performances, is ideal from our ‘making some noise’ perspective, especially as your research and knowledge are going to help you pick those tournaments where he is more likely play well. Also, his inconsistency means he might be 126.00 pre-tournament yet still be taken seriously should he get on a leaderboard – resulting in a useful shortening of his price if he gets into contention.

The type of player that makes regular cheques with barely aTop5 is not nearly as much use to you if you’re employing back-to-lay; everybody knows they won’t win! Their steadiness keeps their opening prices artificially low too, so their price trading range will be tighter. I’m thinking of players of the ilk of: Brian Gay, David Lynn, Charles Howell & John Senden. They’re good but they just don’t win, so when they appear in 8th place on a leaderboard on Sunday, nobody except their wife cares.

Further, it’s little use backing a guy who regularly posts money-making but mediocre scores. A guy who shoots even par for a tournament with 72-66-74-64 is a far more attractive back-to-lay proposition to you than the guy who typically shoots 71-72-73-72. There are plenty of these guys who rarely ‘go low’ and you need to identify and avoid them.

iv) Opposing the Champion Players

In a tournament with Rory & Tiger competing, the prices of the rest of the field pretty much double. Your guy who was 101.00 last week may now be 251.00 with the big guns present. This is interesting to back-to-lay bettors though it creates an intriguing double-edged sword to consider pre-tournament:

Sword Edge 1: If Rory goes out on day one and shoots 62 and leads by 3 from Tiger, with your guy 50th, your man will now be paying 1000.00 and will likely never shorten throughout the remainder of the tournament and thus you lose your stake as no lay opportunity arises. This is depression time for back-to-lay strategists and it happens to the best. Regularly! Round one, our guy posts a few bogeys while the champs are flying and we know that 99 times out of a hundred we’re already dead in the water.

Sword Edge 2: If Tiger and Rory both start poorly and are well down the standings after round two with your 126.00 man not far from the lead, given his record and the absence of threat from the big guns, he may already be paying 50.00 and thus be juicily layable.

If you’re going to take on the top players in this manner, the key is clearly to select events where the guns have a lesser chance of winning, eg Tiger Woods playing a Pete Dye course or The Masters. Yeah, I know Tiger once owned Augusta, but that was young, healthy Tiger and he hasn’t won there, despite being in contention on Sunday at least four times, since 2005! And one could argue that Rory will forever carry mental scars and extra media pressure into Augusta every year until he exorcises the ghosts by winning it.

Congratulations on reading this far; arriving here means you’re part of a very special minority of humans – people who read something longer than a tweet!

Back-to-Lay 201, if I ever get around to penning it, will build on the themes touched on here. We’ll:

  • Differentiate between strategy and tactics and work top-down to formulate a back-to-lay strategy first and then work on what tactics will be employed to support that strategy;
  • Examine earnings yields and targets in more depth, taking commissions and opportunity cost into account;
  • Take a look at both backing and laying players before an event has even started;
  • Examine how many players are truly in a market and the % margins associated with just them;
  • Check out the size of bank you need and how much of it should be intelligently risked on each event;
  • Understand the powerful market dynamics in play on the bet exchanges: the big layers, the bookmakers and the professional gamblers and;
  • Most important of all, we’ll develop tactics on who to back, when and when and how much to lay off!

Cheers, and good luck with your betting in 2013, Mike.


Copyright  MJ Miller (Mike)  16 January 2013