Where to use the break-even points calculator

Assume that you think that the dollar/euro rate will go up in a given period of time. If you are certain enough about it and want to make use of it, you have several options.

Over the counter

 You spend dollars to buy euros (normally through your bank),

and once the expected change has occurred you will sell your euros for dollars.

The bad thing about this is that banks apply different exchange rates for purchases and sales. The selling rate is usually 5% higher than the buying rate.

Even if you have speculated well and the dollar euro rate has gone up by 5%, you will have gained nothing.

Futures

In the futures market, you can buy and sell derivatives at any moment during the business hours of the stock exchange. You can make use of price changes and take your profit at any time. (provided that your margin

Example:

You buy euros with a future delivery date for 1,000 US dollars. The current rate is 1.36. You will have 735.29 euros. Prices keep changing and when the rate is 1.37, you close your position by selling your euros. You will have 1007.34 dollars, a profit of 0.73%. (exclusive of commissions, handling charges)

Betting on futures in online betting exchanges

In a sense, all betting events are futures. Each transaction is between parties holding opposite views on the outcome of the same event. Views on the probability of an event to occur or not to occur may change slowly or quickly. Speculators usually have got hot money and therefore seek liquid markets to make profit quickly on the changing odds. This is exactly where the break-even points calculator can be used to calculate quickly the stakes and odds to be offered.

Example:

Market (at betfair): What will be the Spot Exchange Rate of the Euro against the US Dollar at 18:00 UKT. Users are trading to the price quoted in the market. The market will be settled using the first 18:00 Bloomberg Composite Price.

You can tap the gap making offers in four ways:

1. Back the first outcome at 1.84 and lay it at 1.83.

2. Back the second outcome at 2.20 and lay it at 2.18.

3. Back the first outcome at 1.84 and back the second outcome at 2.2. Use the break-even points calculator to calculate the relevant stakes.

4. Lay the first outcome at 1,83 and lay the second outcome at 2.18 or even at 2.20. Use the break-even points calculator to calculate the relevant stakes.

There are many ways to play the market and the break-even points calculator is very useful in most cases. It can be used on events with three outcomes as well.

Note: assuming that you have bet 1000$ backing the first outcome at 1.82 (simply accepting the offer made by someone else) and you do not close your position, you will have a profit of 820$ (less 5% commission) or a loss of 1000$ (no commission is paid on losses).

To learn more about betting, sportsbooks and betting exchanges, visit betsbook.com