It occurs when a bookmaker lowers the odds on a particular bet or event due to an increase in bets placed on one outcome, often to balance the liability on both sides of the wager. This adjustment helps the bookmaker ensure they minimize potential losses and maintain a profit regardless of the result.
Cut in the Ground Example
For example, if a large number of people place bets on one team to win a football match, the bookmaker may cut the odds on that team to reduce their payout in case that team wins.