Smarkets is a new betting exchange which aims to shake up the market. With only Betfair having any significant liquidity and volume they have managed to keep their high margins and super tax which are detrimental to large players.
You can watch their video below.
Basically, they charge a flat 2% fee on winnings. Betfair charges 2-5% but most punters will pay the 5% so getting it down to 2% is massive.
In popular markets, the liquidity and spread are adequate. Take for example, the England vs Estonia game on Friday 9th October (2 days away).
As you can see, the odds are identical on both exchanges. The only difference is the volume. There still is enough volume on Smarkets for most people though. Only if you wanted to lay England for more than £1426 then you would have problems with Smarkets.
If you look at all markets on the game though, the picture isn't as rosy. Half time/ Full time is about the same but markets like draw no bet have no bets in at all. Where there are other bets to be taken the spread is too high. For example the hlaf time result is booked to 115.41% on Smarkets vs 102.8% on Betfair. This means in terms of real bets, you can get England at 1.5 for £75 at Betfair where as you can only have £55 at 1.41 at Smarkets. In this case, exchanges aren't the best place to bet. Betfair bookmaker (not the exchange) gives 1.53 and thats with no commission and unless you are a big winner, they'll let you have more than £75 anyway.
Smarkets also do in running but looking at the range of markets, this is limited compared to Betfair and regular bookmakers. I will update the review later once I have checked out the in running properly. I can't see it having the liquidity that Betfair has but I'll have to see. They do allow API access (which allows bots to bet) so that could provide the liquidity needed for an in running exchange to work.
Smarkets do something called Instant Match. This is not available on all games. Basically, it gives you the price you see and it will get matched unless something happens in the next 8 seconds which materially changes the game. These are goal, red card and half time / final whistles. This is different to Betfair as you can place a bet, wait for the delay and the market moves so your bet doesn't get matched. With Instant Match, your bet will get matched.
Smarkets is a decent exchange which I will us more in the future. The spreads on the main market are excellent and whereas not great on other markets can only get better. The 2% margin is excellent for the serious player though. Over time, the difference between paying 5% and 2% is huge so if you are wanting to get in to betting for a living then get on Smarkets. If you are really brave, you could actually try setting the market.