Its all a about decisions versus selections

THE TRUTH ABOUT MONEY (Part 2)

There's no point in devising detailed betting strategies unless you're a winning
player. And the only way to discover the truth about your play is to keep recor
ds. You can't run a business without a set of books, yet I'm constantly amazed b
y the number of bettors who have no real idea how they do at the track.
Perhaps it's that most players lose, and nobody likes to have defeat rubbed in h
is face. Still, haphazard records lead to haphazard conclusions.
Short samples are useless and misleading. Example: In their book Racetrack Betti
ng, authors Peter Asch and Richard E. Quandt examined the performance of a certa
in computer handicapping program.
In 103 plays, the program showed a 41 per cent profit. But the sample included a
$134 winner; take that horse away and the program compiled a 25 per cent loss.
So what was the truth? Was the program a solid winner, a horrible loser that cou
ldn't even match the takeout, or what? Darned if I know, the sample was too tiny
.
The greater the variation in payoffs. the larger the sample size you need to dra
w fair conclusions.
If you're checking a place betting system whose payoffs average $1.30 (for $I),
for instance, a sample of 100 bets would probably be adequate. But if you are st
udying a trifecta method where the payoffs vary from $16 to $16,000, even a stud
y of 4,000 bets may not give 20 you enough information from which to draw a legi
timate conclusion.
Nonetheless, you must start somewhere, and by recording every bet you make, you'
ll discover the truth about your racetrack betting. The most efficient way to do
this is via computer, but even a handwritten ledger is far more than most playe
rs even attempt.
Let's look at what a computer can do for you. Do your repeaters repeat? Do you w
in your $10 bets while losing your $50 plunges? How much success have you had pl
aying the track's leading trainer in certain races?
Most bettors don't know, which is one reason why so many do not improve their pe
rformance from one year to the next. But a computer can show you exactly how, an
d what, you're doing. While many of the facts you'll learn are merely interestin
g, some nuggets may cause you to fundamentally alter your approach, and possibly
increase your profits dramatically.
While many bettors use computers for handicapping and record keeping in areas su
ch as trainer statistics, few use them to analyse their bets. That's too bad, be
cause HOW you bet, not merely how many winners you pick, will determine your suc
cess.
Until the advent of computers, keeping detailed bet records was difficult. Few p
layers bothered with anything more complex than profit and loss totals.
But now it's easy to track down a dozen variables or more, and the sharp bettor
will gain insights into his own betting that he never could with simple handwrit
ten notebooks.
The key is database management software. They all work in the same way. You ente
r bits of data, then ask the software to do certain tasks with the information.
Summing up, about betting in general, to make money at the racetrack you must le
arn about horses, races and MONEY.
Learn about horses and races to become proficient enough to make ; price line, w
hich is your assessment of the relative chances of each hors in a race. Learn ab
out money to be,, exploit flaws in the public line.
Picking winners is over-rated. You can make money at the races even if you pick
very few winners. You can lose money even if you pick plenty.
Shopping for bargains, not just picking winners, is the key to making money at r
acetrack betting. Seek overlays - those horses being sent away at MORE than thei
r true odds.
How to find the true odds is the greatest challenge of handicapping. But whether
you use a computer program, a system, or your own analysis of the past performa
nces, this skill will determine whether you will be able to earn long-term profi
ts at the track.
The one rule you must understand is this: ANALYSE CHANCES, RATHER THAN ATTEMPT
TO PICK WINNERS.
Every race may have a hundred different scripts. In one scenario, a horse who us
ually gets away slowly suddenly jets from the gates; in another, a speed duel fa
ils to materialise; in a third, the favourite is checked at the start.
Though you get only one chance to play a race, think long term: If this race wer
e run 100 times how many times would each horse win? (Editor's note: For a diffe
rent angle, check out Joe Takach's articles on the Upside and Downside of racing
in PPM.)
Actual odds are set by crowds. And the public is not only often wrong, but its l
ine may careen wildly depending on a thousand different factors.
Every crowd is different. Every day is different. Every race is different. And y
ou never know when the public is going to hand you a bargain.
Some bettors want to bet their pick, no matter what. Instead, think value, which
means that your decisions may not be the same as your selections.
At times, your top choice will win without you. But if he does not offer value,
don't bet him. And it doesn't matter how much you like the horse.
Don't look for winners. Instead, seek the best bet for the odds. Sometimes it's
a win bet on one horse. Other times it's a place bet, or seven exacta combinatio
ns.
Value is price versus worth. Every price must be compared with every worth, and
vice versa. Demand that the crowd (the public) offer you a price at least 50 per
cent above what you consider a fair price for a horse or a combination.
If you do not receive at least a 50 per cent bonus, do not bet.
Why 50 per cent? Why not 10 per cent or 100 per cent? From thousands of bets ove
r many years, I've found that a 50 per cent bonus on every bet will yield somewh
ere between 8 per cent and 10 per cent profit on total money invested.
Any bonus lower than 50 per cent will result in a loss. A higher bonus requireme
nt will not yield enough bets.
Why doesn't a 50 per cent bonus yield a 50 per cent edge? Several factors combin
e to reduce profit. Firstly, a 50 per cent bonus is not the same as a 50 per cen
t edge.
Your edge is the probability of win multiplied by odds minus the probability of
loss.
A 3 / 1 shot that goes off at 9 / 2 offers an edge of 37.5 per cent; an even mon
ey shot that goes off at 3/2 offers an edge of just 25 per cent.
A 50 per cent bonus always offers an edge of at least 22 per cent, though the ed
ge never reaches 50 per cent unless the horse goes off at far above a 50 per cen
t bonus.
The odds will often drop after we bet, even if we bet close to post time. Let's
say we make a certain horse 2 / 1. For a 50 per cent bonus, he'd have to go off
at 3 / 1 or better. With one minute to the start, he's 3 / 1. We bet.
But just as the race begins he drops to 5/2, only a slight edge. By demanding at
least 50 per cent, we ensure that the vast majority of our bets will still be o
verlays of at least some amount at post time.
Thirdly, every bet we make has a certain impact on the odds. Fourthly, our own l
ine, no matter how good we get, will never be quite as accurate as the public's.
Underlays, alas, always do better than overlays. For example, the horse we make
even money may well win 50 per cent of the time, but those that wind up going of
f at 3 / 5 might win 56 per cent while those who wind up at 3 / 2 might win only
42 per cent. By allowing for errors, we give ourselves a safety margin.
This is an edited extract from Barry Meadow's book Money Secrets At The Racetrac
k, available from www.trpublishing.com.
Click here to read Part 1.
By Barry Meadow