Category Archives: Handicapping and Betting

Articles on handicapping and betting

If You’re Losing Maybe You’re Blaming the Wrong Person

A week ago I wrote an article titled, Why Do You Lose? I offered a few reasons relating mainly to betting skill. What I didn’t do is blame bad jockeys, cheating trainers, short fields and a high take. After monitoring the public media for a while, my perception is too many people use these reasons as excuses for losing rather than focusing on the number one reason people lose – poor handicapping and betting. As a result they spend far more time complaining than enjoying the best betting game on earth.

I’ve been playing the races over 40 years. Have I gotten bad rides? Absolutely. I don’t have an empirically derived number, but for me the number of horses I bet that were obviously best in a race and were stymied by a bad ride is minimal, most certainly no more than a fraction of 1%. That wouldn’t expain long term loss.

I’m also not buying the cheating trainer theory for losing. Good handicappers will tell you that trainers with “suspicious” patterns are fairly easy to identify and they can adjust their handicapping accordingly. If those trainers are doing anything, they are producing a lot of low priced winners. Even so, the Association of Racing Commissioners International produces statistics that suggest less than one-half of one percent of all horses tested are violating a medication or drug standard, and the vast majority of the violations are for legal therapeutic drugs.

There are those who believe ultra-high percentage trainers are using substances that are undetectable, but I’d make the same argument I made above. Trainers like Kirk Ziadie win at high percentages, but the percentages are there for everyone to see and incorporate into their handicapping decisions. His horses may go off at low odds, but it seems like having a free square may offset some of that. Cheating trainers or not, the percentage of winning favorites has gone up since I started playing, a clear indication that handicappers have gotten better at identifying the favorite.

Even if you are a believer in the widespread cheating conspiracy, you’d still have to concede it’s a small number of trainers and a small number of races. The vast majority of races are solvable without having to worry about incompetent jockeys or drug-happy trainers.

The short field issue is an interesting one. Five and six horse fields can make some races unbettable, but conversely they can make some races more bettable. If you have two horses heads and shoulders above the other three runners, and the high probability exacta is paying $10, it may not be a bad race to bet. In general, though, uncompetitive races are not a good thing for bettors, and 5-6 horse fields are far more likely to be uncompetitive.

Many of the full-field proponents rightly point out the increased probability of higher prices. The more combinations there are, the fewer combinations an average bettor can cover, and thus the potential for high prices shoots up. A good example are the Breeder’s Cup races with a lot of 14 horse fields and some mega prices. Of course at the same time that comes with the potential for more bad rides and orders of magnitude greater difficulty for bettors. It’s a bit of a two edged sword. Five and six horse fields are not good, but eight to ten horse fields would provide plenty of value while keeping chaos to a minimum. Frankly, in most 12 horse fields, 3-4 horses are quick pitches anyway. Field size needs improvement, but it is not a primary explanation of why players lose.

The fact is that most people who lose at the races have some flaws in their handicapping or betting. Believe me, I know because in 44 years of betting horses I’ve made all of them. I can tell you I’ve missed solid plays and made horrible bets, and it was 100% my fault. And that is the first step to winning. Focus on the things that are within your power to excel at, and excel at them. You are never going to keep jockeys from messing up a ride, so don’t spend much time brooding about it. Remember the old saying, fool me once shame on you, fool me twice, shame on me. If a certain jockey seems to throw in more than his share of bad rides, adjust your handicapping.

But I also know that it is possible to beat the races even with the current levels of take. It wasn’t like Andrew Beyer had his $50,000 year at the races when the take was miniscule. In my article, The Magic Number, I pointed out that by doing nothing more than betting favorites to win you could reduce the 17% take to 8-9%, so by eliminating 9 out of 100 false favorites, the bettor is at break-even. And this doesn’t require outrageous amounts of handicapping skill and time. After all, 65 of 100  favorites lose, and you only have to find nine to not lose any money. If you can eliminate15 favorites, you’re a pretty profitable winner. It may be more boring than rooting home some higher priced horses, but because horseracing has an inherent skill component, good handicapping makes it totally possible to identify enough false favorites to create the profit outcome. Don’t miss the point of the example – you can overcome the take with superior handicapping and betting.

The rest of The Magic Number discusses how to become a value win bettor. Again, if you become skilled at assessing the probability of a respective horse winning and limiting your bets to those that are overlays, in the long run you have to win. Clearly, developing the necessary skill takes a great amount of time and effort, and perhaps harder than that is developing the discipline to follow the winning formula.

If you believe that the races cannot be beaten because of the takeout level  you need to first convince me you are not making the mistakes I listed in Why Do You Lose? No question the take makes the hill you are trying to climb steeper, but it’s not Everest. If you are handicapping skillfully and betting optimally and still losing, I’d be shocked. I know a winning season/year can be done from personal experience.

Don’t get me wrong. The takeout rate is a huge problem in horseracing, and unfortunately there is no effective solution available as long as tracks have to pay what amounts to tribute to the state and local jurisdictions. As long as tracks cannot function like other businesses, accounting for the operating and capital expenses and paying taxes only on the profit they make, it is nearly impossible to reduce the take below 15%. Still, that does not mean tracks could not reduce the take to 15% on every bet. Anyone who plays trifectas at tracks like Parx or Penn National is either self-destructive or not paying any attention at all. Tracks have been gouging bettors on every combination or exotic bet and they feel not the slightest bit of guilt about it. Our response is too often to complain and keep betting.

Pretty much every study shows that reducing the take increases betting volume, and ultimately may increase revenues. What is stunning is how few of the major tracks have tried to outcompete other tracks by lowering the take. Sort of like what Wal Mart does – lower prices and either force everyone else to lower theirs or drive them out of business.

I’m working on a new book that will go into much greater detail on both the issues racing faces and what players need to do to beat the game given the hills they have to climb. But in the meantime I’ll remain steadfast that while it is hard, you can beat the game with the right plan.

Why Do You Lose?

It’s hard to win at the races consistently. The game is stacked against bettors at the start. Takeout on bets of between 15 and 30 percent already puts players in a hole, and overcoming that amount takes enormous skill and discipline. Interestingly, the least likely reason people lose is that they are bad handicappers. In today’s information age, handicappers have more opportunity than ever to find winners.

I’ll offer some of the more likely reasons players have negative balance sheets.

You don’t have a plan. How you bet should be dependent on your bankroll, and I’ll elaborate a little more on that below. I’ve advocated that less capitalized bettors should focus on the win and exacta pools while reserving a small portion of your bankroll for more exotic wagers. Having a plan allows you to approach each card with some confidence. You have an idea of how you will attack each respective betting race, and being prepared creates confidence.

You handicap too many races at too many circuits. I think handicapping one card at one circuit can easily consume a couple of hours. There is a lot involved in handicapping a race. Figuring out how the race will be run, watching replays from previous races, getting an idea of the ability of each horse, looking into trainers and jockeys – all that takes time. Is it possible to do this for multiple race tracks and circuits? Sure, but it will take a lot of time both during the races and after the races. Not many people have that kind of time, yet they will be playing from the first race on the east coast to the last race at Los Al, and then maybe turn their attention to Australia. It is one thing to target specific race types at the different circuits, but trying to play 30 to 50 races in a day would be tough for even the best handicappers. Most people playing the races have jobs, families and other obligations. Even if you are just playing on the weekend, it makes little sense to try to cram a large number of races into the day and expect to regularly come out ahead. Being a master at one circuit may be a better alternative than being mediocre at five.

You bet when there is no value. I’ve written about this extensively and cannot emphasize it enough. You have to get away from being selection oriented (I like the 3 horse in this race) and become value oriented (I believe the 3 is an overlay in this race). You have to discipline yourself to not bet when you don’t have an edge.

You bet too many races. I bet every New York race day. In nine or ten races I’m happy to find five to seven races where I can find a value bet. It would be a rare day where I found bets in all ten races.  I recognize that the action can be addictive, but you have to learn to substitute the thrill of winning consistently for the thrill of rooting something in every single race. I’ll admit sometimes I wind up sitting when I should be betting, but I suspect that may be an easier problem to fix than betting too many races. Ask yourself that simple question before betting. Do I really have an edge here?

You hit a race and immediately increase your betting. We’ve all done it. You hit a race and the win bets go from $20 to $50 and you’re throwing money at all the lottery bets. Why? Because psychologically you think, I’m hot! Riding the crest. One question – how long did it take before you were starting over with your bankroll? There is only one way to handle a big win. Discipline yourself to stick with what works.

You’re not properly capitalized for the pools you are in. If you are investing $100 a day in the pick six chances are you’re not going to hit one unless it happens to be a particularly formful day. If there were six races with seven horses each that would be over 117,000 combinations. Keep records. What’s your ROI on your bets? If you are a small bankroll player, the first pools you should look at are win and exacta. I’m not suggesting you should never look at the Pick 5/6, but understand that you can kill your bankroll playing them.

You press when you’re down.They call the last race the “get out race” because lots of people are trying to recover all their loses in that race. Remind yourself, it’s just another betting race that you’ll get into if there is value and there is always tomorrow. It rarely seems like pressing in the last works out unless that was the race you were waiting for all day.

You don’t understand the math when it comes to exotics and you spread too thin. I want to pull my hair out every time I see TVG tweet out a pick 4 ticket with a 5/2 single and 60 combinations, the first question I ask is, is the pick 4 likely to pay more than the same amount on the single to win? Even with 50 cent pick 4’s, a $30 win ticket on the 5-2 shot pays $105, meaning the pick 4 has to pay more than $420 to be a better play. Same with the trifecta or superfecta. Anytime you single a horse you are making a win (or place) bet and you have to be astute enough to make a calculation. You ever hear someone “wheel” a horse in the exacta or the daily double? Yep, they are making a win bet. If you play Horse A to Horse B to some horses in a trifecta, you essentially made an exacta bet. You have to understand the bet you are really making.

You bet when you are on tilt. We’ve all suffered tough losses. Plain and simple, if you have a race to bet after you’ve had a bad beat, make sure you are thinking clearly.

Anatomy of a Winning Day

Saturday April 11 was a day that turned out much better than I thought it might when I first glanced over the card at Aqueduct. I’ve started noting on my selections that my style is to post three horses that I think can win the race and look for the value between the three. I’ve also mentioned that not all top picks are equivalent, and that is an assessment each bettor has to make. Finally, I’ve mentioned that I favor the 50-25-25 distribution of bankroll, or win-exacta-any other bet. I thought this was a good day to see how it all falls together.

Race 1 was a $16K NW3 claiming race with only five going postward. I only selected two horses in this race, 2 John Silver and 4 Blue Chips only. 2 went off at 5-2 while the 4 was 3-2.  On my personal line the 2 was around 8-5 and the 4 around 2-1. Obviously the 4 was not an overlay, and the 2 was hovering on the line for me. In my definition of overlay, the horse has to be at least one and a half times over my line, since this gives a reasonable margin of error. Eventually I decided the race was a no-bet and passed. 2 won the race returning $7.20, 4 finished third.

Race 2 was a $25K NW3 claimer with seven starting. . I selected 2-3-5, Van Frassen, Everydoghashisday, and Can’t Catch Me Now. Van Frassen, as expected went off at 7-5 and was no overlay. On the other hand, Everydoghashisday went off at 10.40-1 and for me was a major overlay. The 5 at 4-1 was close to my odds and therefore not a bet. The play was to bet the 3 to win and an exacta with 2 on top of 3. You might ask why I wouldn’t have reversed the exacta. Simply, any bet with the 3 on top was a win bet, and while the 3-2 certainly would have payed more than the win mutuel, this was really a play in lieu of making a place bet. Remember, I thought the 2 was more likely to win, but the 3 was the value play. You have to overcome your selection oriented mentality to realize the big overlay was the only value win bet. For the sake of calculation, lets use $10 as the win bet play and $5 as the exacta play today (my personal plays are quite a bit larger). In this race then the net profit was $99 ($15 bet, $114 collected).

Race 3 was a $20K open claimer and my selections were 1-2-4, Luckysdream, Shot to Win, and Southbeachsanday. I had the 1 as a strong favorite on my line, but the 1-2 tote board odds were still too low to consider a win bet. Shot to Win went off 3.75-1, and based on my line was a small but bettable overlay. The 4 at 6.80-1 was not an overlay for me. So the bet was a win wager on the 2 and an exacta 1-2. The 1 won the race by the slimmest of margins, with the 2 second and the exacta paying $9.30. This race was very close to a no bet for me, but even with the less desirable outcome, net profit was $8.25.

Race 4 was a MSW and the choices were 4-5-2, Performance Bonus, Good Pick Nick and Summit Moon. 4 went off at 4.30-1, and on my line was not a bettable overlay. 5 went off at 6.30-1 and crept into value range. 2 went off at 10.60-1 and was also in value range. While you’ll read a lot of things that advise against betting two horses in the same race, I think the value proposition will often make you obligated to make that bet. So in this race it was $10 to win on 5, $5 win on 2 (since they weren’t equal no problem reducing the bet), a $2 exacta box 4-5. Only the win bet came in so the net profit was $54.

Race 5 was a statebred allowance and the choices were 5-1-3, Huge Asset, Repent Twice and Groupthink at respective odds of 3.55-1, 3.80-1, 2.10-1. None of the horses was a value play so the race was no bet. The race was won by Native Hero, another 3-1 horse.

Race 6 was a $25K Starter Allowance and the choices were 9-1-2, Bug Juice, Ground Force, and Royal Posse at respective odds of 3.90-1, 1.90-1, 8.50-1. The only win bet was Royal Posse and made a small play with 9 and 1 on top of 2 and a 1-9 exacta box. Ground Force won the race and Bug Juice was edged out of second by Jeter. The net loss was minus $30.

Race 7 was a state-bred allowance and the choices were 5-9-3, Pete’s Fleet, Gypsum Johnny, and Swell at respective odds of 7.80-1, 4.60-1 and 2.85-1. This was a juicy race for me. Gypsum Johnny was a slight overlay, Pete’s Fleet was a much bigger overlay. Swell was not even close to value. On my line the 5 and 9 were fairly close, so I bet both 5 and 9 to win, and played an exacta box. 9 won the race at $11.20, 5 ran second, and the exacta paid $94.50. Net profit was $202 with a $10 win mutuel and a $5 exacta.

Race 8 was the Top Flight Handicap and the choices were 8-2-3, Before You Know It, House Rules, and Joint Return at respective odds of 4.90-1, 0.40-1, and 8.90-1. The 8 was enough of an overlay for a win bet, the 2 was not a win bet and the 3 was on the line for me. I wound up betting both 8 and 3, and betting a 2-8 exacta. 2 won the race, 8 came second and the exacta paid $10.80. Net profit was $7.

Race 9 was a statebred maiden and the choices were 8-1-5, Tricky Zippy, Marc the Sky, and Livi On Love at respective odds of 1.65-1, 11.80-1, and 20.90-1. The 8 was clearly not an overlay for me, but both the 1 and 5 were. I bet both to win and an 8-1 exacta. 8 won the race but neither of the other horses was close. Net loss was $20.

So total for the day was bet$145, collect $459, net profit $314. And that was betting no more than $10 to win and $5 exactas.

If you had wanted to bet a Pick-4 or two, based on my picks you may have missed the first but hit the second. There were also a few possible trifecta bets.

 

The point of this piece was to show how you can make money betting overlays and using the 50-25-25 bankroll distribution. Your picks may have been different than mine, but ask yourself if you had made a value line and determined which horses were overlays, and you employed my strategy of focusing your betting on win and exacta, how much would you have made?

Betting the Races

“In the Criminal Justice System the people are represented by two separate, yet equally important groups. The police who investigate crime and the District Attorneys who prosecute the offenders. These are their stories.”  Opening to the TV series Law and Order

I’m going to paraphrase that a bit. In horseracing there are two separate but equally important skills. Discovering winners through handicapping, and betting them correctly.

Handicapping is mostly science, but there are elements of psychology and art thrown in. You want to find the horse likely to run the fastest, but sometimes it is not as simple as a calculation. Sometimes you are looking for patterns, especially those associated with specific trainers. Good handicappers often “see” things that lesser handicappers miss. It is about taking masses of data, filtering out the irrelevant pieces, and weighting what’s left correctly. It’s about understanding the “style” of a horse, and whether that style fits in a respective race.

ABILITY + STYLE + INTENTION = WINS

There are a great number of better than average handicappers playing the races, but the percentage making money is much smaller.

Betting is pretty much all science. Calculations of risk and reward. I would suggest the first thing you have to do is categorize yourself as a bettor. Do you like to grind out profit? Do you live for the big hit? Are you playing for fun or are you serious? Are you willing to make the right bet at the right time, whatever it is?

I’d point people at Andy Beyer’s My $50,000 Year at the Races. He made all his money betting win and exacta. When he was sure and he had an edge, he fired and won enough to make big profit.

I remember talking to a non-horseplayer about spending my vacation at the track. He figured if he was going to spend a thousand dollars on a vacation he rather go scuba diving. i pointed out that once he spent the thousand it was gone, but I actually had a chance to come home with more money than I left with. And even if it cost me a thousand dollars to spend a week at the track, I’ll bet I had as good a time as he did scuba diving.

Lots of people see spending money at the track as entertainment. If at the end of the year they are down a few bucks, it was just the price of entertainment. They win some, they lose some; have a few big thrills, a few big disappointments. If that’s the case, bet in whatever way makes you happy, as long as you are, as the ads say, betting with your head not over it. But if you are playing to make a profit, you have to show some discipline and get into the pools that fit your bankroll.

Most betting handbooks tell you that a critical element is to keep records. See which bets are profitable, which are not. That’s a fine idea, as long as you are willing to change your betting pattern once you decide certain bets are losers for you.

I think you can become good at any type of bet, depending on your bankroll, but I would maintain that for the average player some bets are better than others. I’ve often advised smaller players to divide their bankroll into three parts: 50% win, 25% exacta, and 25% other bets. If you are a better than average handicapper, this is a good way to either make profit or keep your bankroll alive longer, and still allow you to get into some of the exotic combination pools.

Here is my opinion of the various betting pools.

Must pools

Win – read my article The Magic Number http://halveyonhorseracing.com/?p=147 to  learn how to bet win. If you think about it, vertical and horizontal bets all have a win component to them. If your choice wins the race, the worst thing is to be caught not cashing tickets.

Exacta – read my article Risk Intelligence http://halveyonhorseracing.com/?p=149 to learn how to bet exactas. With the exacta you can turn 8-5 shots into 5-1 shots. Again, it’s very disappointing to have a winner and not bet it because the odds are too low.

Occasional Pools

Place – read my article Betting Two Horses http://halveyonhorseracing.com/?p=827 to learn why you should rarely bet place. I understand why people bet to place – it is a psychological salve against watching your horse just miss. But arithmetically, you are almost always better off taking the money you would have bet to place and playing it to win, either on the horse you prefer or your second choice. Even if you make fewer collections, in the long run you’re likely to make better profit. The one exception to the no place rule would be horses going off at odds, since often the place price will be as good as the win price on other horses. If your horse is 37-1 and finishes second, you better have an exacta or place tickets, preferably both. Let me make one emphatic point – I’m not telling people to bet two horses to win every race. I’m telling people that if they were GOING TO BET TO PLACE, put the money in the win pool instead.

Trifecta – my favorite way to bet the trifecta  is to play a solid choice on top, the two most likely place horses in second, and longer priced  contenders in third. If you reference the Magic Number, you’ll see a series of graphs that show the percentage of longshots finishing third is actually higher than you’d expect. A horse with a 10% chance of winning may actually have as high as a 25% chance of finishing third. I’m sure you’ve figured out that betting this way is essentially making a win bet, so what you are really banking on is getting a price in third. If you’re going to bet the first three choices, save your money. Bet a trifecta to make a nice hit if your top choice wins and a longer priced horse finishes third. But don’t forget – you still need to make the win bet if your top choice is value. And some exactas.

Daily Double – This is simply a win parlay, and is a good bet if you have a shorter price horse that you can play with a longer price horse. A couple of tips. NEVER wheel a horse in the double. A smarter way to play would be to bet doubles just with some of the longer priced horses with a reasonable chance to win, and make a bigger win bet on the horse you thought about wheeling. The smartest way to play is to just take all the money you were going to invest in the double and place it to win on your single. Finally you should rarely play more than a 2 X 2 double. If you are that unsure, wait for a better betting opportunity.

Pick 3 and Pick 4 – It’s hard to resist lottery bets, and frankly most people don’t have the bankroll to play them properly. There was a time when all I played was the Pick-4, investing $100 to $200 a race (with $1 tickets). I hit some big ones, but when I looked at my records overall, I was barely making a positive ROI. I also realized that whenever I had a single, I was essentially making a win bet on that horse. If I invested $120 in a Pick-4, and my single hit but I didn’t cash on the Pick-4, the irritation I experienced stuck with me a while. I’ll give you one alternative way to bet the Pick-3/4. List all your potential contenders for each race and pick the likeliest winner for each event. Play the Pick 3/4 as a series of a single in one race with the contenders in the others. I still don’t think it’s superior to a series of win bets, but if you’re determined to play the Pick-3/4 it gives you a chance to cash multiples without a cost much higher than betting one ticket with all the combinations. You can also reference my article, The New Way to Bet Pick-4s http://halveyonhorseracing.com/?p=1097

Never Bet

Show – I’ll just say this. You’re a better horseplayer than that.

Pick 6 – Unless you are highly capitalized, it’s a sucker bet.  I guarantee that for every story of a bettor hitting a big Pick 6 with a $15 ticket, there are a thousand stories of a syndicate snagging the pool by betting $10,000. I’ll concede that if there is a big carryover the temptation to bet might be overwhelming. In that case, go ahead. Better yet, form your own syndicate and compete with the bigger boys.

Pick 5 – See Pick-6 above. Most bettors are not capitalized to bet it properly. There may be a time when you can get into it cheaply, but this is definitely case of caveat emptor.

Quinella – bet the exacta instead. It’s usually a bigger pool and a better payoff, especially if the longer price of the two horses is on top.

Superfecta – It’s tempting to get into it for a dime, but it is most often a waste of money. You have to cover a lot of combinations, and unless you have a a few longshots in the four positions, it’s hardly going to pay enough to do more than grind out profit. The one exception might be on Breeder’s Cup Day. More than a few of those superfectas   pay boxcars.

The New Way to Bet Pick 4’s

There was a time I thought the Pick-4 was the best bet in racing. Even if the take is 25%, it is only taken on the original bet, whereas if you play a parlay, the take is assessed for each event. This should ensure the Pick-4 pays better than the parlay.

It is not that the Pick-4 has become a consistently poor bet, but it is more and more often not returning at a value level. Let’s start with an assumption:

For the Pick-4 to be value, the payoff has to be at least 1.5 times the parlay.

Admittedly the 1.5 number is arbitrary, but the Pick-4 must at least pay more than the parlay for it to be a worthwhile bet. After all, the straight mathematical probability of even four 2-1 horses winning consecutive races is a little over 1%, meaning in theory we should expect at least a $200 payoff (which also happens to be a bit less than 1.5 times the parlay).

I calculated Pick-4 payoffs against the parlay for the first two months of the Aqueduct meet and found the following:

  1. There were 74 Pick-4’s in that time period (I didn’t count the Pick-4 payoffs where there were dead heats for win).
  2. 15 (20%) of the Pick-4’s paid less than the parlay.
  3. 27 (36%) of the Pick-4’s paid less than 1.5 times the parlay.

If it was easy to determine when the Pick-4 would underpay, this wouldn’t be a problem. We would just bet those Pick-4’s with a high probability of returning our value number.

Unfortunately, no pattern seemed to emerge. While you might expect Pick-4’s with low priced horses to underpay and those with longshots to overpay, there was no predictability. A $19,000 Pick-4 severely underpayed , and a $159 Pick-4 severely underpayed based on the parlay. The average payoff for the underpaying Pick-4’s (excluding the two that paid over $19,000) was around $1,400, about the payoff the parlay for three 4-1 shots and a 9-2 shot would return. As best as I could see:

  1. Sequences with mid-price horses and no short-priced favorites were usually solid overpays;
  2. Sequences with a race where the crowd is confused are often solid overpays. For example, if there are five horses between 3-1 and 9-2, the crowd will have to spread thin to cover

I looked at the early and late Pick-4 to see if one or the other was more likely to underpay. Of the 27 underpaying Pick-4’s 17 of them were the late Pick-4 and 10 were the early Pick-4, so while it wasn’t a powerful pattern, it was a clear trend toward the later Pick-4 underpaying. I believe this is likely for a couple of reasons, First, the late Pick-4 has a much larger pool and more of the lower probability combinations can be covered. Second, the later Pick-4 has the better races of the day (7th and 8th) and these may have stronger, more confident favorites.

I looked at the highest paying (over $5,000) overall Pick-4’s. There were 13 in that time period, 9 in the early Pick-4 and 4 in the late Pick-4. Again, not a definitive pattern but a clear trend that the early Pick-4 is more likely to produce boxcar payoffs.

So what is a bettor to do? As a broad generalization, I’d suggest that the Pick-4 is not a good bet given the high percentage of underpays. But if you can’t give up the bet I’d offer the following advice:

  1. If you have a single in your sequence, make some mental calculations because in the end whatever you bet into the P4 is essentially a win bet on your single. For example, if you have a single at 5/2 and you invest $20 in P4 ($0.50) tickets, that means you should expect the P4 to pay at least $280 to break even against the win bet. If your single is 5/1, that amount goes up to $480. Plus, you don’t have to worry about hitting three of four and getting knocked out by a horse you would never use.
  2. Consider leaving out the low paying combinations (the four favorites for example). Yes, you’ll hit fewer but you’ll invest less and have a greater possibility for an overpay.
  3. Swinging for the fences runs through everyone’s mind, and while the boxcar tickets come in about 17% of the time, they are hard to hit with small investments. In some cases anything less than an “all” in one of the legs would have produced disappointment for most players.

Which brings me to the title of the article: The New Way to Bet Pick-4’s:

Pick four to six races where you feel confident and where your choices are not ultra short-priced favorites and construct 1 to 3 Pick-4 sequences. Bet $10 to win on the first horse in the sequence, it it wins, pocket half the collection and parlay the rest to the next horse, and so on. 

In this way the races do not have to occur in a row, which means you don’t have to use the 12-horse maiden state-bred race that is mandatory in the normal Pick-4 sequence.

Let’s go through some hypothetical calculations.

Example 1

  • Leg 1       7/2
  • Leg 2       4-1
  • Leg 3       5/2
  • Leg 4       5/1

If you hit all four legs, and bet according to the suggested pattern, this is what it looks like:

  • Leg 1      bet $10, collect $45
  • Leg 2      bet $22, collect $110
  • Leg 3     bet $55, collect $192
  • Leg 4     bet $96, collect $577

The $2 parlay would have paid $945, the Pick-4 anywhere between $700 and $1,500. With the new way, you collect $173  on the win tickets you didn’t invest into the parlay in addition to the parlay collection of $577 for a return of $750 on your initial $10 investment, not that far from the parlay amount and almost certainly ahead of a $0.50 Pick-4 payoff.

Let’s say you lost the second leg. You are still $13 ahead (minus your initial $10) and can use that to start a new sequence. Say you lose the third leg. You still come out $68 ahead and can use all or part of that to bet the fourth leg. And if you win the first three legs but lose the last, you come out $164 ahead. On a $10 investment that is over 1,600% ROI. In the normal Pick-4 bet, if you lose any one of the legs you lose everything you invested.

Example 2

  • Leg 1     1/1
  • Leg 2     4/1
  • Leg 3     2/1
  • Leg 4     3/1

In this sequence with some really low priced horses, you would collect $150 on the $10 four race parlay plus $72 on reserved win bets. The $2 parlay would be $240 and the likely Pick-4 payoff would be between $200 to $400. Even with a really low paying sequence you are still likely to do 2-3 times better with the new parlay bet over a $0.50 Pick-4 ticket.

You’ll probably miss the boxcar Pick-4 payoffs with this method, but how many of those are you hitting? The bottom line is that you’ll lose less and have much steadier profits. And if you don’t have four horses you are willing to bet to win, make it a Pick-3 using the same strategy.

You can also bet two separate tracks, meaning you bet $10 on each of two horses in the first leg, if one of them wins bet two horses to win in the second leg and so on, but the point is that you are looking for four races in a card where you are confident you have the winner. The great thing about betting this way is that you never lose more than your base bet (in my example $10 but you can make it whatever you want) in the sequence, and if you lose a race, you just start over again.

There is an old racetrack maxim that says bet a little to win a lot, but don’t bet a lot to win a little. With this new Pick-4 approach, bettors are in a great position to bet a little and win a lot.

Public Handicapping

I had an interesting discussion this morning with some other handicappers about selection sites and making claims. It mainly came down to whether you can claim you “picked” the winner if it wasn’t the horse you put on top. There really isn’t a definitive answer (well, that’s not totally true – individually everyone was sure of their position), at least if that is the question.

There seem to be two general classes of public handicappers: those who make a selection in all races and those who zero in on a few races. There are plusses and minuses for both.

Being realistic, if you are picking nine races at a respective track, and you hit any better than the crowd percentage for winning favorites with your horses on top (around 35%) you’re doing pretty well, and if you have a positive ROI you are doing really well. If you are picking a limited number of races at a track and you have any sort of positive ROI you are also doing really well.

I focus exclusively on Aqueduct (for now anyway) and provide selections for all nine races a day. I’m going to make a confession. I don’t bet a horse to win in every race. There are some races where I have a higher level of confidence and races where I’m only a step or two above taking an educated guess. I guarantee there isn’t a public handicapper out there that would tell you any different. I’ll make another confession. If I have given my top choice a 25% chance of winning and it is 2-1, I’m not going to bet the horse. If I have given my second choice a 20% chance of winning and it is 7-1, I may bet that horse to win because of the value proposition.

Part of this morning’s discussion was whether people following a handicapper are ever betting any horse to win other than the top selection. I suppose if you are a bettor doing no work at all, you might see the top pick as coming from an oracle, but I am more optimistic and I think most people look at my picks and make an evaluation. If a handicapper wins with 35% of his top choices, people should understand that means on a normal day they had three or four winners in nine or ten races, and to make money the winners have to average a little better than 2-1. I expect them to understand that from a pari-mutuel standpoint, the second or third choice may be a better bet. I’ve often said, I’ll identify the most likely winner and any legitimate contenders for the win, but how that information is used is up to the individual handicapper.

I suppose assigning odds to each horse like some handicappers do would be helpful, and I may consider doing that in the future. But the important point is that not all top choices (or second or third choices) are the same and not all of them should be bet. If you’ve handicapped for any length of time, you know exactly what I mean.

I’m most interested in three bets: win, exacta, and the horizontals (pick 3/4/5/6). I rarely bet the Pick-6. I’ll bet the Pick-5 a little more often, but am very interested in Pick-3 and 4. If you are betting horizontals it is fairly common to use multiple horses in some of the events, so having three horses to choose from makes sense.  In a later blog I’ll comment on strategies for betting Pick-3/4.

I’ll share one other thing about the way I pick. I’m looking for horses I think can win the race, which means I’ll often eliminate horses that are 1 for 30 in the win slot, but 50% place and show. These horses often will make up the exacta or trifecta, but I simply find them difficult to back as winners, so rarely will they show up in my top three. If they do show up, it is because I am not seeing any other win prospect, and generally I’ll mention my concern in the write-up.

For me, the point of public selection is to tell people who look, I think Horse A has the highest percentage chance of winning, Horse B has the second highest percentage, and Horse C has the third highest percentage. It doesn’t imply that Horse B has the higher chance of finishing second, and if you want to understand that go back and read my blog piece, Risk intelligence.

I will continue to most often offer three selections per race but I will consider the best way to differentiate races so it will be clearer which of the horses on top I think are most likely.

Inside Some Numbers

The other day one of the “Boom” guys got excited when his $28 Pick-3 play paid $165, which sounds pretty good until I pointed out the parlay was $215. Ok, it was a little snippy to say something, but I was always from the Paul Brown school that said, act like you’ve been there, and save the sonic booms for a really major score.

I took a look at the rolling P3 payoffs from Aqueduct last Saturday and Sunday and here’s what I found

RACE    WIN PAY     PARLAY PAY   ACTUAL PAY

  • 1                9.90
  • 2             20.60
  • 3             20.60                  1,050                    551
  • 4                4.40                      466                    413
  • 5                3.60                         81                       80
  • 6                8.50                         33                       44
  • 7                6.50                         49                       57
  • 8             14.40                      198                    252
  • 9                6.80                      159                    389
  • 1                8.50
  • 2             37.00
  • 3                4.20                      330                    596
  • 4             18.80                      730                    998
  • 5                3.50                         69                       99
  • 6                6.60                      108                    174
  • 7                9.10                         52                       47
  • 8             11.20                      168                    127
  • 9                3.30                         84                      77

This is a pretty small and unscientific sample, but there are a few interesting things.

First, only 57% of the P3’s paid better than the parlay and that was a surprisingly low number. Now the superiority of the Pick 3/4/5/6 bets is supposed to be that in a multiple race sequence the “take” is only grabbed once. In the parlay, the take would be applied to three different bets. So, we would expect a premium (say at least 25%) for our P3 wager. Of the eight P3’s that paid more than the parlay, seven paid over a 25% premium. and only 5 paid a 33% premium. And, only one on Saturday and one on Sunday paid more than a 50% premium. Shouldn’t we expect most of the P3’s to pay more than the parlay? All in all, ithe P3 was a marginal bet on those two days from an investment standpoint.

Interestingly, the P3’s that paid more than the parlay on Saturday were in the last four races. On Sunday it was the first four races, so nothing consistent there. On Saturday a sequence with two 9-1 shots and a 7-2 shot paid half of the parlay. On Sunday a sequence with a 3-1, 6-5 and 17-1 paid practically double the parlay. On Saturday a sequence with two 2-1 shots and a 6-1 shot paid more than double the parlay. The one thing both of those sequences had in common was that the biggest price was in the middle of the sequence. On Saturday the lowest pay sequence paid more than the 25% premium we would be seeking. On Sunday, the low pay sequence was actually less than the parlay.

I think this may be something worth studying with a much larger sample because the evidence from two days was ambiguous. But it tended to lean toward what it felt like to me all season – the P3 is not consistently a good bet, at least at AQU.

Let me say one last thing about horizontal wagers. If you have a single in your sequence, you are essentially making a win bet on that horse. Even though the ML isn’t always representative (assuming you don’t make your own line) you can use it to make a rough calculation of your horizontal bets. If you have a single in your sequence, decide how much you want to invest and do your best to determine the return if you placed it all to win on the single versus the P3. It’s a lot easier to sweat one race instead of three, and if your single wins, you are a winner no matter what happens in the other two legs.

If you follow me on twitter, you know I am a big fan of win bets and even two horses to win in the same race. It can be a grind, and you won’t have too many BOOM’s, but at the end of the day the idea is to find the best way to maximize return on investment.

Betting Two Horses

Slow week last week with Thanksgiving and all. Horseracing took a back seat to family and the holiday, as it should.

After a prompt from Jason Beem, I thought about doing this week’s blog on the uncomfortable chemistry between Peyton Manning and Papa John on those pizza commercials, but I really didn’t have much more than what I just said. Although it did strike me that unless you are an accomplished jazz musician or a voodoo high priest you have no business referrring to yourself as “Papa.”

Here’s a note to advertising agencies. You are not obligated to use Phil Phillip’s song, Home, in every commercial. I’m not sure when I hear the song in the background if it is for insurance, car sales or something else. It also reminds me of a David Spade joke about Lynyrd Skynyrd. They only did two songs. Free Bird and Not Free Bird. Sorry Phil. Nobody but your most ardent fans can name your other songs. And that’s as much as I needed to say about that.

California Chrome won the Grade 1 Hollywood Derby, causing the folks at Del Mar to spew forth superlatives, including that he was the only horse to win four Grade 1’s this year, which is totally true if you ignore Main Sequence.  No real story here. He beat Lexie Lou, a filly with Canadian credentials and Talco , a three year old with a career as an allowance horse staring him in the face. Needless to say, based on the level of competition, Chrome didn’t cement his case for horse of the year.

I was going to talk about addicted gamblers, mostly based on one guy on Twitter who seems to bet a ton of races, gets ridiculously angry (almost ever time at the jockey) when he loses, and can’t wait to shout when he hits one. Pretty much every race. I wrote in detail about this in my article, Risk Intelligence, which you can find in the July archives, so I’m not going to go into detail again. But this is one of the warning signs of gambling addiction, getting really furious if you lose and over the top if you win.  I’ll just say, if this sounds like you, you might see if you have some of the other warning signs for addicted gambler.

Aqueduct ended it’s main dirt meet with a whimper when they took all the races off the turf on Cigar Mile Saturday and the inside part of the course was like playing like horses were running on a concrete moving walkway. Not much of a story there either.

However, on Cigar Mile Saturday if you had played my top two selections to win, you would have hit 5 of 10 races and your ROI would have been 63%. That means if you were betting $10 to win  on the top two horses in each race, you would have bet $200, collected $326.

The idea of playing multiple horses to win has been mentioned in a lot of books, including my book, The Condition Sign, and was developed as a strategy by Howard Sartin, a psychologist who treated addicted gamblers with the devilishly simple idea that the cure to chronic losing was winning.

Let me start with my maxim: In most cases it is more profitable to bet two horses to win than to bet one horse win and place. Whenever you hear people pumped up about their “ladder” bet, either they don’t understand the arithmetic of win and place betting, they need the psychological salve from a place bet, or they lose all the win photos their horses are involved in. Let’s look at the arithmetic.

We’ll start with the assumption that your top two choices both average 4-1 and that one of your top two selections wins 50% of the time, and your top choice wins 25% of the time and finishes second 15% of the time when it doesn’t win. The place price will be assumed as $5. There are three possibilities.

  • one of the two horses wins
  • your top choice does not win but finishes second
  • both finish out of the top two spots

For the sake of calculation, let’s say you either bet $10 to win on your top two choices or $10 win and place on your top choice.

In the case of betting two horses to win, in 100 races the total bet would be $2,000, the total collected would be $2,500. In the case of betting one horse to win and place, total bet would be $2,000, total collected wouild be $2,250. Of course, if you took the same $20 and put it on your top pick to win, you’d collect….$2,500. In other words, betting to win only is superior (using these assumptions) to ever betting win and place. I’d challenge you to do your own experiment picking two horses in a race and figuring out whether it would be more profitable to bet them both to win or pick one and divide the same amount win and place. Eventually you can get sophisticated enough to make win bets unequal based on your calculated win line, but that’s a different lesson.

Most people who bet place just can’t deal psychologically with the lower collection percentage, and I fully understand that. But you have to keep telling yourself, I’m better off in the long run not to bet place (most of the time).

Now I’ve read pieces that talk about betting against yourself if you bet two horses to win. For the most part, they are wrong, but I’ll concede it depends as much on your successful selection rate as anything.

The one time I think you are justified in making a place bet is when your horse is at big odds, and again it is for psychological reasons. Not long ago I had a horse just get nipped at 37-1 and I believe it would have been devastating to not make some collection. Besides, the place mutuel was better than the vast majority of win mutuels.

I realize this is a bit of a grinding way to win, and for that reason I would concede that it is fine to budget half your bankroll for win bets and half for exotics. That is maxim number two: half of the money you bet should be to win.  If you play well, there is plenty of opportunity for profit.

 

The Four Most Important Questions When Handicapping

This is a repost of an article from earlier this summer but

Only four, you say? Well of course there is a lot more to handicapping than what I’m going to say below, but if you don’t know these four things, you’ll be starting in a hole.

At today’s distance and surface, what style is winning? Most of us have a way of assigning running style to a horse. I use early, presser, sustained in the following way.

E – normally runs on the lead
EP – will run on or very near the lead
PE – usually won’t take the lead but will be within a length or two of the frontrunner
P – prefers running just off the pace
PS – will be midpack but prefers running on from off the pace
SP – prefers running from the back with a closing style
S – a plodder early, will make up ground in the stretch
Let’s look at the last week of the Belmont spring meeting.

Dirt Sprints – E=2, P=7, S=3
Dirt Routes – E=4, P=5, S=2
Turf Sprints – E=7, P=4, S=0
Turf Routes – E=4, P=5, S=3

This gives us a recent track profile (for all the good it will do considering the meet ended Sunday). In dirt sprint races, horses just off the pace do best. In dirt routes, generally the same, although speed holds up a bit better. In turf sprints the sustained runners could not crack the win column, with the early speed and pressing types dominating. In turf routes the pattern seems to be more even, so any style has a chance to win.

Next we want to look at the placement of the horse in relation to the rail. On Sunday July 13 the track seemed to play fair for dirt runners, neither favoring the rail or mid-track runners. Usually when biases develop they are short-lived, often related to weather incidents. When I look at biases, I generally will look at two things: how does the track play in off-weather conditions and how does the track play immediately after a weather incident? So if we were playing Belmont today, we’d be most interested in early speed/presser types in sprints, pressers in dirt routes and presser/sustained in turf routes and generally we aren’t going to be concerned about post position as long as our choice can get an attacking position.

Which race do I use to evaluate my horse? Most people look at a horse’s last race, and it is important to look at the last race. But if it is not at today’s distance or surface, we may want to use another race for our evaluation. When we get to questions three and four, this will become clearer.

Generally I want to look for a recent race that is at (or within a half furlong of) today’s distance, on today’s surface, where the horse won or finished within a couple of lengths of the winner. It is usually the case that the shorter the race, the higher the number, so I want to know how well a horse runs at today’s distance. Does that mean I use a race from a year ago, or even two months ago? Only if I think it is really representative. At the end of the day, the condition a horse is currently in trumps all else.

Now if you are evaluating a horse who has been off for a while, you should look at any similar comeback races on the past performance in addition to other competitive races. The Racing Form and Timeform U.S.can give you lifetime past performances. The Racing Form and Timeform U.S. also give you statistical information on trainer success with layoff horses.

Races where the horse gets a good number but where the horse was far back are generally not going to be as useful as races where the horse was competitive. It is often the case that the better horses “pull” a runner along with them, and you often see this in horse coming from higher classes into lower class races. I just don’t trust a figure earned from a race where a horse ran eighth by 10 lengths.

Finally, you have to make an overall evaluation of the horse’s interest in winning. When you see a maiden with the lifetime record of 17-0-6-6, no matter what the horse’s figure, you have to steeply discount the winning probability, even if the horse has a top figure.

How fast can my horse run? I want to know what my horse is capable of running when he is at his best. If my horse ran his best race today, would he be competitive? Which begs the last question

Can my horse run a winning race today? At this point you have most of the basic information you need to answer the important questions. Does my horse have the right running style? Do I think he is fast enough to win? Is he in good enough condition to win?

There are other factors, of course. Trainer or jockey may influence your handicapping. Moving up or down the class ladder (negative or positive class drops, e.g.) can be worth evaluating. Track condition could be critical. Changes in equipment or medication or a move to a new barn have to be considered. But the essential task of handicapping is to find the horse you believe will run fastest today.

Betting Menus Approaching Cheesecake Factory Size

Since I’ve gotten a lot of new followers lately I’m going to post some of my older articles. Enjoy.

Are you thinking about betting the second at Belmont today? If so, you have the choice of win, place, show, exacta, quinella, trifecta, superfecta, pick-3, pick-4, AND a double. That’s 10 separate pools into which you can spread your money. If that isn’t enough, you can get into the pick-5 in race 1, the pick-6 in race 5 or perhaps the coolest bet in racing, the Grand Slam in race 6. I guess the theory is that all those choices cover every type of bettor who might show up, and for large tracks with large handles it may work, but at smaller tracks it’s a bad idea all the way around.

And remember. Most people don’t have a computer program identifying pool inefficiencies. The vast majority of the race day crowd relies on habit or experience to get into a pool.

When Arapahoe Park reopened in 1992 after an eight year hiatus they made a great decision when they decided to drop the quinella and instead offer a $1 exacta box. Same two dollar bet and a collection as long as your horses finished first and second in either order, and it accomplished something important. It made the exacta pool larger than it would have been otherwise, and at smaller tracks pool size is critical. At that time dog racing in Colorado was king, and the king of dog racing bets was the quinella. People were literally flummoxed by the absence of the quinella, complaining to the point where Arapahoe was forced to eventually bring it back. It’s been downhill from there.

As someone once said, you can’t save people from themselves.

Even if you couldn’t make a $1 exacta bet, quinellas shouldn’t be offered. How many times have you seen the longer shot win the race and have the quinella pay $20 and the exacta $60? The point is that when the longer shot wins, you want a premium for your combination bet. With a single first/second pool, you have a much better chance at getting a fair pay. Plus you don’t have to go through the mind numbing exercise of checking the payoffs in two pools to figure out where the inefficiencies are (assuming you don’t have some software doing that for you). The last point is that at the smaller tracks, too much of the action happens in the last five minutes and the pools can be highly volatile as bettors search for the overlays. At least if there is only one pool there is a chance the pool might stabilize a little sooner and you’ll come closer to getting the payoff you expected when you bet.

Frankly, the quinella should go the way of the horse and buggy. Tracks should weather the storm and eventually people will forget the quinella.

The next bet they should get rid of is the show bet. The show bet caters to two segments of the betting public: people who go to the track with $20 and want to come home with $20 and the big dollar bettors who are happy to take 5% on their money. It’s a 19th century bet, which makes little sense considering we are well into the 21st century. You want to make the stingy bettors happy? Have a win pool and a combined place/show pool like you see in venues outside the United States. Again, at the smaller tracks, this can only help stabilize pools.

Other bets can be offered based on track handle. Saratoga, Belmont, and Santa Anita can pretty much offer as many bets as they please, even though they still dilute pools unnecessarily. Still, remember that most of the super-exotic pools are dominated by the latge bettors and syndicates, and most of the betting public is simply donating to their cause. I would argue all day long that one gigantic exacta pool benefits big and small bettor alike.

The larger tracks have a built in dilemma when it comes to which bettor to cater to. The small player has a much better chance at hitting the easier combinations – doubles, exactas, maybe even trifectas. But as you get to the more exotic bets such as the superfecta or picks-4,5,6, small bettors are most often just donating money to the pool. For every “small guy hits pick-6 with $32 ticket” story, there are a hundred where some whale investing $15,000 hits it. There are 5,040 combinations in a 10-horse race superfecta. Even if half of them are improbable, who has the bankroll to cover 2,520 combinations, even at 10 cents a ticket? This problem is exacerbated at the small tracks.

At Arapahoe Park yesterday, the total handle was around $68,000 for 11 races. That’s not $68,000 a race. That’s $68,000 total. The superfecta in race 11 paid $627.60 for a 7-3-ALL-ALL ticket of which there was exactly one $2 (or two $1) ticket holder. Arapahoe doesn’t have 10 cent superfectas because, as they discovered, the total pool would be about $200. This also means if you had the 7-3-5-ALL or the 7-3-5-4 you would have collected…that’s right, $627.60. How much money should you put into a pool where you will collect $627.60 if you snag the whole thing? Arapahoe offers superfectas because everybody else does, but frankly they would have been better off just building the trifecta or exacta pools.

I know this is unkind, but I have pretty much never run into an ardent racegoer who doesn’t complain that management may understand the actual operation of a track, but precious few actually understand the pari-mutuel aspect. The standard answer to any question is, because that is what the fans/owners/trainers ask for. They are helpless against the onslaught of those who demand 10 betting pools a race.

Offering a ridiculous number of pools is not in the interest of the average bettor. The only time they prosper is when the favorites come in. Otherwise most bettors are just feeding the anti-Robin Hoods – stealing from the poor to give to the rich.

Ray Paulick quoted Charles Cella, Oaklawn Park track owner in 1988 opining that exotic wagering was the worst thing in the world. That’s a silly opinion, but the larger point is well taken. Too many bets pull money away from the pools where the average bettor may have success. I’d challenge the larger tracks to undertake an experiment. Take a Wednesday and have win and place/show betting, exactas, and trifectas on every race, three pick-3’s, one pick-4, two daily doubles, two superfectas and a pick-6.

Check out this great blog on exotic betting by Ray Paulick

http://www.paulickreport.com/news/ray-s-paddock/exotic-bets-are-racetracks-headed-down-the-wrong-path/