Hedge Potential

Introduction

A back-to-lay (B2L) trade means backing a horse at its Betfair starting price (BSP), then laying it in-running at a shorter price to lock in a profit whatever the result.

Hedge Potential (HP) shows the biggest profit that trade could have locked in, as a percentage of the stake. For a single run it is the profit available at the horse’s in-play low. For a horse, jockey or trainer it is the average across their runs in the period. Higher is better.

HPMeaning
0The price never went below BSP, so no profit could be locked in.
100The price halved: a profit equal to the stake could be locked in.
400The price traded at a fifth of its BSP: a profit of four times the stake.

How a back-to-lay locks in a profit

Back 1 unit at a price of B. Later, lay B / L units at a shorter price L.

  • If the horse wins: the back bet wins B – 1 and the lay loses (B / L) x (L – 1). Net profit is B / L – 1.
  • If the horse loses: the back bet loses 1 and the lay wins B / L. Net profit is again B / L – 1.

So the profit is the same either way, and the shorter the lay price, the bigger the profit.

Profit locked inThe price must trade at or belowExample with BSP 6.0
50%BSP / 1.54.0
100%BSP / 2 (half the BSP)3.0
200%BSP / 32.0
400%BSP / 51.2

How it is calculated

Per run

HP uses the horse’s in-play low, the shortest price matched on Betfair during the race:

HP for a run = (BSP / in-play low – 1) x 100

BSPIn-play lowHP
6.06.0 or higher0
6.04.050
6.03.0100
6.02.0200
2.01.533

On race results this is shown as HP for that run.

Rolling figure

rolling HP = total HP / number of runs, kept between 0 and 400

Long-priced winners can produce very large single-run figures: a 20.0 winner that trades at 1.01 scores nearly 1,900. Keeping the rolling figure within 0-400 stops one run like that from dominating.

Best, worst, trend, normalised scores and race rankings work as described in the statistics overview.

Reading it

  • HP measures the opportunity: the best profit a back-to-lay trader could have locked in at the in-play low.
  • A rolling HP of 100 means that, on average, a back at BSP could have been turned into a locked-in profit equal to the stake.
  • Winners usually trade at or near 1.01, so they score highly. A high HP reflects both winning often and strong in-play support.
  • To see how HP compares with PD, BR and Impact Value, see In-play price moves.