Tick Size Maths explained for betting

In one sentence

Tick size maths converts Betfair's uneven price steps into what they mean in implied probability and in green-up profit, so you know what a one-tick move is worth wherever you trade.

How it works

Betfair prices cannot take any value. They move in fixed steps called ticks, and the step size grows as odds get bigger:

1.01 to 2: steps of 0.01
2 to 3: 0.02
3 to 4: 0.05
4 to 6: 0.1
6 to 10: 0.2
10 to 20: 0.5
20 to 30: 1
30 to 50: 2
50 to 100: 5
100 to 1000: 10

That gives 350 possible prices from 1.01 to 1000. A move from 2.00 to 3.00 is 50 ticks, while 4.0 to 5.0 is only 10. At the very ends, 1.01 is lay-only territory and 1000 back-only, because there is no price beyond them to trade out to.

Because the steps are uneven, a single tick is a very different event at different prices. Near evens it is a small change in probability; at 1.01 it is almost a whole percentage point. Traders who think in ticks need to translate them into probability and pounds, or they compare apples with oranges.

The maths

\Delta p = \frac{1}{o_{1}} - \frac{1}{o_{2}}

\text{Green profit} = S_{b} \left( \frac{o_{b}}{o_{l}} - 1 \right)

Δp: the change in implied probability between two prices.
o1, o2: the lower and higher of the two odds.
Sb: your back stake.
ob: the odds you backed at.
ol: the odds you lay at to close the trade.

In plain English: the green-up profit on a closed trade is your stake times the percentage gap between your back and lay prices, before commission.

Worked betting example

What one tick is worth in probability:

1.01 to 1.02: 0.97 percentage points.
1.50 to 1.51: 0.44 points.
5.0 to 5.1: 0.39 points.
20 to 21: 0.24 points.
100 to 110: 0.09 points.

What a one-tick scalp is worth in pounds, backing £100 then laying one tick shorter:

Trade A: back £100 at 2.02, lay at 2.00.

Lay stake = 100 × 2.02 ÷ 2.00 = £101.
If it wins: +£102 on the back, −£101 on the lay = +£1.00.
If it loses: −£100 on the back, +£101 on the lay = +£1.00.
After 2% commission on net market winnings: £0.98.

Trade B: back £100 at 5.0, lay at 4.9.

Lay stake = 100 × 5.0 ÷ 4.9 ≈ £102.04.
Profit either way ≈ £2.04, or about £2.00 after 2% commission.

So one tick at 5.0 pays roughly twice one tick at 2.02 for the same back stake. But the price at 5.0 also moves more ticks in a given time, so the risk is larger too.

Where it's good

Choosing which price range suits your scalping or swing-trading style.
Setting stop-losses and profit targets that mean the same thing across the ladder.
Comparing moves in two runners at very different prices.
Correcting backtests that assume you can trade at any price.

Limitations and pitfalls

A tick is not a unit of value; the market does not care how many ticks something moved, only what the probabilities are.
At short prices (below about 1.20) each tick is a big probability jump, so a queue can sit there for ages then jump suddenly.
The band boundaries (2, 3, 4, 6, 10 and so on) create odd behaviour: the price can move quickly through a band with small steps and stall at a boundary.
Commission is charged on net winnings per market, so the net value of a scalp depends on your whole position there, not the single trade.
Profit per tick grows with odds, but so do volatility and impact, so bigger-tick trading is not automatically better.

How to build it

Write a small Python function listing all 350 valid prices; it lets you count ticks and round model prices to valid ladder prices.
betfairlightweight includes price-ladder helpers you can check your function against.
Tip: store and analyse prices as implied probabilities, and convert to ticks only for execution.

Implied probability turns each tick into a probability change.
Back-lay hedging is how the green-up profit above is locked in.
Market impact depends on how many ticks your order walks through.
Commission-adjusted EV shows how commission eats into small tick profits.