Lay-to-Back Trading on Betfair: How to Profit From Drifting Prices

The lay-to-back strategy is a classic Betfair trading approach. You lay a selection at a shorter price and aim to back it later at a bigger price, locking in a profit from the drift. This guide explains how the method works, how to size stakes, and how to control risk using the Smarter Trades calculators.

What Is Lay-to-Back Trading?

Lay-to-back trading reverses the more common back-to-lay pattern. Instead of backing at a high price and laying at a lower one, you start by laying when you think the price is too short and then look to back at higher odds once the market moves.

The goal is to:

Lay at lower odds
Back at higher odds
Use the price difference to lock in profit or reduce risk

As with all trading on Betfair, nothing is guaranteed. Prices can move against you just as easily, so managing liability is critical.

When Does Lay-to-Back Make Sense?

Lay-to-back strategies are most commonly used when:

You believe a favourite is overbet and likely to drift in price
Market sentiment is extreme compared with your own ratings or models
There are known events that may cause drift (e.g. team news, going changes, early overreaction)

In other words, you are taking the view that the current odds are too low and will move up to a fairer level as more information or money enters the market.

Basic Lay-to-Back Example

Imagine a horse in the pre-race market:

Current price: 2.80
You think fair value is closer to 3.40

You decide to:

Lay £30 at 2.80
Target a back bet at 3.40 later

If the price drifts as expected, you can then use a back/lay hedging calculator to work out the correct back stake to balance your position. Once both bets are matched, your profit will come from the price difference, not from predicting the race result.

You can find the hedge tool here: Smarter Trades Back/Lay Hedge Calculator.

Managing Liability on the Initial Lay

The first leg of a lay-to-back trade is always the most dangerous, because you are exposed to full liability until you get your back bet matched. That liability can be large if you are not careful.

Use a lay liability calculator to check:

Your lay stake
The odds at which you are laying
The total liability if the selection wins

You can use the free lay calculator here: Smarter Trades Lay Liability Calculator.

Using the Hedge Calculator to Green Up

Once the price has moved in your favour and your back bet is matched, you can “green up” – that is, level your profit across both outcomes.

The Smarter Trades hedge calculator lets you:

Enter your original lay odds and stake
Enter the new back odds
Set your commission rate
See the back stake needed to balance your position
View profit if the selection wins and loses

This removes guesswork and arithmetic mistakes when you are trying to trade quickly.

Key Risks of Lay-to-Back Trading

1. The Price Moves Against You

Instead of drifting, the price may shorten further. In that case, you face a choice:

Take a controlled loss by backing at a worse price than your lay
Hold the unhedged lay and accept the risk of a full liability loss

Neither is pleasant, which is why position sizing is so important.

2. The Price Never Reaches Your Target

It is possible for a favourite to hover around your entry price and never reach your desired drift level. If you are too rigid about your target odds, you may miss chances to hedge at a smaller but still acceptable gain or reduced loss.

3. In-Play Volatility

If you hold the trade into in-play, prices can move very quickly and liquidity may thin out. There is no guarantee that your hedge bets will be matched, especially at the exact price you want.

Best Practices for Lay-to-Back Traders

1. Cap Liability as a Percentage of Bank

Decide in advance the maximum percentage of your bankroll you are willing to risk on a single lay-to-back trade. Use the lay calculator to ensure your stake fits inside that limit.

2. Plan Exit Points

Before you place the initial lay, define:

Your ideal hedge price (for profit)
Your worst-acceptable hedge price (to cut loss)
Conditions that would cause you to exit completely

3. Use Tools, Not Mental Maths

Trying to calculate liabilities and hedge stakes in your head during a fast-moving market is a recipe for errors. The Smarter Trades calculators exist to keep the numbers straight so you can focus on decision-making.

Frequently Asked Questions

Is lay-to-back less risky than backing?

Not automatically. Lay-to-back can control risk if liability is sensible and hedging is disciplined. But a badly sized lay can be far more dangerous than a simple back bet. The difference is in execution, not the label.

Can I use lay-to-back in-play?

Yes, but in-play trading adds execution risk. Prices move fast, markets can suspend, and you may not get your back bet matched. In-play lay-to-back should use smaller stakes and extra caution.

Does every lay need to be traded out?

No. Some traders place lays they are happy to leave to expiry if the price does not move. Others always aim to trade out. Decide your rules in advance so you are not making emotional decisions mid-race or mid-match.

How do I start practising lay-to-back?

Begin with small stakes, use the lay liability and hedge calculators on: Smarter Trades, and track every trade. Look for patterns in how prices move in your chosen sports and refine your entry and exit rules over time.