Day one of racing’s Ebor Festival saw an expected win for red-hot, odds-on favourite Australia in the Juddmonte International at York.

For many punters, betting on short-priced favourites may not always seem the best way to gain value – so this is where spread betting on horse racing can provide an alternative via either Race Index bets or Matchbets.

To explain how these markets work, let’s first look at the fixed odds prices before the day’s racing began so we can compare the difference between fixed odds betting on horse racing and spread betting on horse racing.

Ahead of the off, Australia was the 4/6 favourite on Spreadex’s fixed odds for the 3.40pm with nearest challengers Telescope and Mukhadram at 5/1 and 11/2 respectively. The Grey Gatsby, which eventually finished second, was 14/1.

A £100 fixed odds bet on Australia to win would have meant a profit of £66.66, plus the return of the £100 stake, while £50 each way on the Grey Gatsby would have meant a profit of £175 plus £50 of the total £100 staked being returned. So how would the spread betting markets have differed?

Well, the main spread betting alternative to the fixed odds is to play the Race Index. In this instance the index was a 50-25-10 as there were less than 11 runners.

This market is based on the winning horse being awarded 50 points, the second placed horse 25 and the third placed horse 10 (for races of 12 runners or more, the index is 50-30-20-10).

Australia was priced 32-35, Telescope 17-20, Mukhadram 16-19 and the Grey Gatsby 8-11.

Here a £10 buy of Australia at 35 would have resulted in a £150 profit when the dual derby winner came home in front (making up at 50) while a £10 buy of the Grey Gatsby at 11 would have returned a profit of £140 for a second place finish (making up at 25).

The important difference to note here is that when spread betting on a Race Index, you can lose more than your stake should your bet go against you. So, for example, if Australia had finished a surprise second (making up at 25), the £10 buy at 35 would have lost £100. And if the Grey Gatsby had finished fourth or lower (making up at 0), the £10 buy at 11 would have lost £110.

When betting on a Race Index, you can also get against a horse if you don’t fancy it. E.g. a £10 sell of Mukhadram at 16 in this race would have returned a profit of £160 when the five-year-old came in fourth.

The other alternative to a fixed odds bet is to play a spread betting Matchbet. This is when the spread betting companies put their prediction of how many lengths they think one horse will beat another by. Or in the case of odds-on favourites, the Matchbet pits the rest of the field against the favourite.

So in Australia’s case, the Matchbet was Australia/The Field -0.5 – 0.5. This meant that the Spreadex traders were offering a ‘choice’ price and pitching the middle of the spread directly at 0 lengths. This meant spread betters could have bought the Matchbet at 0.5 and made 1.5 times their stake when Australia eventually came home two lengths in front.

If you wanted to take Australia out of the equation completely, you could have bet on a Matchbet between Telescope and Mukhadram. The Spreadex price before the race was Telescope/Mukhadram 0-1 meaning the Spreadex traders felt Telescope was going to beat Mukhadram by about half a length.

In the end, Telescope finished 3.25 lengths ahead of Mukhadram meaning buyers at 1 would have made 2.25 times their stake, while sellers at 0 would have lost 3.25 times their stake.

Spread betting on horse racing offers many more markets either over a single race, a full day’s racing or an entire meeting including selections such as Winning Distances, Starting Price of the Winner, Double Number of Winner, Favourite Performance, Race Squared Number or Multi-Mules. See more information on our horse racing Card Markets here.

So next time you look at the fixed odds prices for a horse race and see a short price favourite – such as odds-on Taghrooda in the Darley Yorkshire Oaks on Day Two of the Ebor Festival – maybe the horse racing spread betting markets could offer an interesting alternative.