# What is 1X2 betting?

Are you looking to make sense of sports betting? 1X2 betting, also known as three-way betting, offers a more straight-forward approach. It lets you back or lay a home win, draw or away win. We explain what a 1X2 betting market is, and how to calculate your potential payout.

1X2 bets are hugely popular on sports where there is the possibility of a draw. The '1' refers to a home win, the 'X' the draw and the '2' the away win.

Unlike Asian handicaps or totals, 1X2 betting doesn’t seek to even out any difference in perceived quality between the teams or players. They aim to reflect the true odds of every possible outcome minus the bookmaker margin or exchange commission.

## How to calculate your payout for a back bet on a 1X2 market

There are two stages to calculating your payout for a back bet on a 1X2 market. As an example let’s say you backed Liverpool to beat Manchester City with a stake of £100 at odds of 2.88.

Step 1: Calculate return excluding commission

It’s calculated as:

Odds * Stake = £ return

So in our example: 2.88 * 100 = £288

Therefore if Liverpool won your bet would return £288 - including stake, with a £188 profit.

However, because betting exchanges don’t add a margin into the odds - unlike bookmakers - you need to subtract the commission from the profit.

Step 2: Calculate return with commission

It’s calculated as:

((Stake * (Odds -1)) * Commission rate

In our example that would be: ((100 * (2.88 -1)) * 2% = £3.76 commission

So in our example you would be charged £3.76 commission, meaning your return would be £284.24 - a profit of £184.24

If the match ends in either a draw or a Man City victory, you would lose the bet and your £100 stake.

Even when commission is factored in to the odds, you will generally find that Smarkets has the best price - a result of our industry-low 2% commission on winning bets only.

Once you have learnt how to calculate betting margins, you can compare margins across bookmakers and exchanges to find who offers you the best value odds.

## How to calculate your payout for a lay bet on a 1X2 market

Unlike a bookmaker when betting on a 1X2 market, you can also lay the result. As an example let’s say you lay Man City against Liverpool with a stake of £100 at odds of 2.68.

Similarly to calculating your payout for a back bet, there are two stages for a lay bet.

Step 1: Calculate return excluding commission

It’s calculated as:

Odds * Stake = £ return

So in our example: £100 = £100

Therefore if the game ended in a Liverpool win, or a draw your bet would win, giving you a £100 profit (before commission).

Step 2: Calculate return with commission

The next stage is to calculate your lay bet profit, with the exchange commission factored in. At Smarkets - 2% commission on net profits - you can use the following calculation:

Stake * 0.98 = profit

In our example that would be: 100 * 0.98 = £98

Therefore you would be charged £2 commission, meaning your profit would be £98.

When laying outcomes on a betting exchange, you should be aware of your liability on a lay bet - the amount you would need to payout if the game had finished in a Manchester City win. This article explains how to calculate liability on an exchange.

For this example if the game had ended in a Manchester City win, your liability would have been deducted, resulting in a loss of £130.

## Apply this to betting

The popularity of 1X2 betting derives from its simple format. You now understand what a 1X2 betting market is and how to calculate your potential payout.

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