Cashout - Explanation & Examples

Today, any reputable company will provide you with a cash-out option for your pending bets. Until the bets are settled and within the offer, you will be able to cash out your bet. In most cases, cash-outs are utilized to secure partial winnings from the maximum possible payouts if the odds have changed in your favor. On the other hand you can cut your potential losses if you feel the odds are leaning away from your prediction. It is basically an in-play trade of the bet between the bettor and the bookmaker. At any given time, the bookmaker evaluates your bet at a specific amount, which is then offered to you as a bettor. You have the option to accept the offer and trade/sell the bet accordingly.

Why Cashout?

Does cashout benefit the bettor? You might think so if your team is leading by a couple of goals, and you claim a 'good' cashout offer. In this scenario, you effectively use the tool to secure your winnings before the final whistle. But the bookmakers didn't invent the cashout option for the bettors' benefit; instead, it's designed for their own advantage. In every cashout, a bookmaker's share will be added, and you will not be offered the fair price initially. For the bettor, it will be more of a mental play and give the bettor a false feeling of control over his own bets. But don't get me wrong; there are times when you can definitely use it to your advantage, especially if you're watching the game and notice that even though your team is leading, they are not performing well on the field.

Example prematch

Let's take a real-life example: if you place a pre-match event where the odds haven't changed after placing your bet, you will notice in the example below that the cashout amount is 2% lower than your wager, or 0.04€ on a 2€ stake.

And you have to be aware that this example is from Betfair, which has the lowest bookmakers' margins on the market. All other bookies will add way more margin to their calculations.

Possibility of winning

While there is no accurate data ever published by any bookmaker about how much they gained offering a cashout, we can make some predictions. We know that approximately 74% of 1:0 leads end up in winning the match. Around 94% of matches where one team leads 2:0 result in winning the match, and 99% of matches are won by teams with a 3:0 lead. In this case, we will focus on soccer matches as they have the most accurate data and constitute the largest betting market. Some may argue that a 2:0 lead is the most dangerous in football, but the data shows the opposite. It is quite unlikely that you will lose your bet after a 2:0 lead.

In Play scenario

Now, consider a high-tier match in the final phase of a Champions League knockout stage or World Cup, where a team leads by 2 or 3 goals. There are millions of bettors who have placed a bet, and their team is leading by a significant margin. The cashout will be offered at a reduced price, as a bookmaker's share is always added, which will not give you the 'fair' price. Instead of waiting for the final whistle, millions of customers would rather take the cashout and watch the last 10 minutes in peace. The payout savings the bookmakers can achieve this way are huge. So, in this case, it is a mental strategy that the bookmaker is using for its own advantage and still provides the customer with a tool that makes betting more entertaining. Don't get me wrong; it can all go wrong for the bookie as well in those 6% of cases after a 2:0 lead or 1% of cases or less after a 3:0.