Frank N
3rd December 2001, 11:06.23 PM
Gramps phoned me early this afternoon and told me to look at the show pool at Suffolk Downs race 6. In this field of six in a minor stakes race with a purse of $25,000, a horse called Jini's Jet, a multiple winner of Massachusetts stakes races, was facing very weak company. But the show money was almost mind-boggling. At one point in time, she had almost $325,000 bet on her to show, while the rest of the field had less than $1,000 bet on it. Of course others across the country saw this, especially since it was a slow day, and the rest of the field ended up with from $2,200 to $4,800 bet on them, while Jini's Jet ended up with around $375,000. Jini's Jet won easilly. Still, had something happened to Jini's Jet, the show mutuels would have been very rewarding for backers of the other horses, ranging from about $85 on the second favorite to over $200 on the longest one. I pointed out to Gramps that one of the reasons that the horse was bet so heavilly was because Massachusetts requires the minimum payout to be 10 cents on a dollar, or $2.20. This basically turned the bet into breakeven at 90.91% instead of 95.24% needed with a five cent ($2.10) minimum payoff. The 10 cent minimum is decent, especially since Suffolk has a prohibitive 19% takeout on straight bets (and an even worse 26% on all exotics).
Which brings us to the topic. It's possible in races with heavilly bet show pools for EVERYBODY to have an overlay. Let's give an example.
Assume that 100 such races, each with five horses, come up during a span of time. Now assume a $2.10 payout, which requires that 20 out of 21 such races be successful, or 95.24%. For the sake of argument, we'll assume that the standout horse shows in 97 of these 100 races. Assume that $300,000 is bet into each pool to show on the key horse, and that $2,500 is bet to show on each of the other four horses.
For simplicity's sake, we'll assume mere $2 bets.
The man who bets $2 (or any amount of the $300,000) to show on the key horse in each of those 100 races wins 10 cents 97 times, or a total of $9.70. He loses $2 3 times for $6 in losses. He makes $3.70 for the $200 he bets, or a 1.85% profit, or an ROI of 1.0185.
The guy who bets $2 (or any amount of the $2,500) to show on each of the other four horses every time does better. Since he has to cash two tickets in when the key horse wins (unless three all four of the other four horses were to not finish the race), he gets $4.20 back ($2.10 twice), so he loses $1.90 97 times, or $184.30. The three times the key horse runs out take a little more math. Tracks have different takeout rates, but we'll assume a takeout of 17% in each case. 17% of the $310,000 is $52,700, which leaves a net pool of $257,300. From that, $7,500 (the total bet on the three horses who showed) is subtracted, leaving $249,800. That's divided by 3, which is $83,266.67, which is divided by $2,500 (for each horse), or 33.3067, rounded down by breakage to 33.30. Multiplying that by 2, we get $66.60, then adding back in the $2 bet to show, brings us to mutuels of $68.60. Our two dollar player has three winning tickets, so he collects $68.60 times 3, or 205.80, which, deducting the $6 he bet to show, leaves him $199.80 profit on the race. The $199.80 times 3, is a total win of $599.40, which we deduct the $184.30 in losses from to get to a net win of $415.10 for the $800 total that he bet, or a 51.89% profit, or an ROI of 1.5189. And this 51% profit is on a mere 3% success rate.
Of course the discrepancies aren't always this great, but the bridge jumpers don't hit 97% either. Suffice it to say that there is money to be made betting against such horses. The exact mathematics and tables for when to play are dependant on the number of horses in the race and the key horse's actual chances of showing. As a general rule of thumb in a you can bet against a key horse when the percentage of the show pool on it reaches about 92%. It doesn't seem to matter how many horses are in the race, since added horses, while they require an additional investment, also offer an additional chance to beat the key horse. You might want to require 95% , to take into account the betbacks that will occur from other people who notice the discrepancy and bet on the other horses.
Which brings us to the topic. It's possible in races with heavilly bet show pools for EVERYBODY to have an overlay. Let's give an example.
Assume that 100 such races, each with five horses, come up during a span of time. Now assume a $2.10 payout, which requires that 20 out of 21 such races be successful, or 95.24%. For the sake of argument, we'll assume that the standout horse shows in 97 of these 100 races. Assume that $300,000 is bet into each pool to show on the key horse, and that $2,500 is bet to show on each of the other four horses.
For simplicity's sake, we'll assume mere $2 bets.
The man who bets $2 (or any amount of the $300,000) to show on the key horse in each of those 100 races wins 10 cents 97 times, or a total of $9.70. He loses $2 3 times for $6 in losses. He makes $3.70 for the $200 he bets, or a 1.85% profit, or an ROI of 1.0185.
The guy who bets $2 (or any amount of the $2,500) to show on each of the other four horses every time does better. Since he has to cash two tickets in when the key horse wins (unless three all four of the other four horses were to not finish the race), he gets $4.20 back ($2.10 twice), so he loses $1.90 97 times, or $184.30. The three times the key horse runs out take a little more math. Tracks have different takeout rates, but we'll assume a takeout of 17% in each case. 17% of the $310,000 is $52,700, which leaves a net pool of $257,300. From that, $7,500 (the total bet on the three horses who showed) is subtracted, leaving $249,800. That's divided by 3, which is $83,266.67, which is divided by $2,500 (for each horse), or 33.3067, rounded down by breakage to 33.30. Multiplying that by 2, we get $66.60, then adding back in the $2 bet to show, brings us to mutuels of $68.60. Our two dollar player has three winning tickets, so he collects $68.60 times 3, or 205.80, which, deducting the $6 he bet to show, leaves him $199.80 profit on the race. The $199.80 times 3, is a total win of $599.40, which we deduct the $184.30 in losses from to get to a net win of $415.10 for the $800 total that he bet, or a 51.89% profit, or an ROI of 1.5189. And this 51% profit is on a mere 3% success rate.
Of course the discrepancies aren't always this great, but the bridge jumpers don't hit 97% either. Suffice it to say that there is money to be made betting against such horses. The exact mathematics and tables for when to play are dependant on the number of horses in the race and the key horse's actual chances of showing. As a general rule of thumb in a you can bet against a key horse when the percentage of the show pool on it reaches about 92%. It doesn't seem to matter how many horses are in the race, since added horses, while they require an additional investment, also offer an additional chance to beat the key horse. You might want to require 95% , to take into account the betbacks that will occur from other people who notice the discrepancy and bet on the other horses.