Smarkets Pro Tier

You may have seen my post a few days ago about why Smarkets is the logical choice for those just starting out. Well, a few days later, Smarkets introduced something called a pro tier.

What exactly is a Pro Tier?

This is a good question. First its worth looking at how Smarkets commission is structured:
Smarkets positions[ed] its self as a great alternative to Betfair thanks to a number of reasons. Primarily the P2P technology they use keeps costs low which is passed on to the consumer in the form of low commission rates. However as Smarkets has built up interest from customers it is now trying to position itself as more for punters then traders. 

This new Pro tier commission solidifies this, because not only did Smarkets introduce a Pro Tier commission rate, they also introduced a much more appealing market maker rate that is designed to attract more market makers.

How does the Pro Tier Work?

The Pro Tier is a set 1% commission on all bets placed whether they win or lose this is the crucial thing for traders as you know, certain strategies require a trader to enter and exit the market at opportune times to take profits from the price difference (scalping). For such a strategy, 1% commission on wins and losses is huge. 

When Do you get put on the Pro Tier?

This is another point of contention, you will be placed on the pro tier if you have placed 1500 or staked over £1m in a calender month. That doesn't sound to bad right? Wrong.

If you're a trader, you'll know that the number of bets placed is set very low. Couple this with the fact that all bets count (including matched, unmatched, partially matched, back and lay) and you can hit that limit in no time atall. Infact, I can see from my KPI that I've entered over 1000 bets and we are only half way through the month!

Conclusion

It seems the new commission structure is designed to appeal to new market makers, but it's a delicate balance. Because without traders, arbers and matched bettors who could all reasonably hit the Pro Tier Markers, Smarkets exchange eco system would fall apart.

It is also worth noting that Smarkets have had a bit of a shady relationship with their market makers for quite a long time. I believe this is a sign of the direction Smarkets wants to go and believe that -if you're starting out- then they are a great option, but you should use alternatives the moment you come up against the pro tier commission.

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