Ask the Wizard: Horse Racing - FAQ
I've had this argument with several friends and I hope you can help. They say horse racing is a bad bet because of the "takeout". It's true the track has a takeout that varies from about 16% to 30%, depending on the type of wager, but my contention is that there is no factually correct way to determine a horses "true odds". If you figure a horse has a 50% chance of winning, but the odds are 3-1, isn't that a good bet, no matter what the takeout is? I know some handicappers that set their own odds and only bet when they feel the odds are in their favor, and some do well.
— Kevin from Van Nuys, California
A good bet is a good bet, regardless of whom it is against. However, you can't ignore the high house cut at the track. You also can never be sure of what the true odds are at the track. If I thought a horse had a 50% chance of winning but paid 3 to 1, then I would doubt by own judgement that the horse really had a 50% chance of winning. Along the same lines, when choosing a mutual fund you should consider not only the historic rate of return but also how much is charged in commissions.
Hi wiz, great site. I recently made a wager on all others in the Kentucky Derby futures betting. My odds closed at5/2 I know that this is about $7.00for a $2.00 wager, but in watching the odds, I believe that it was closer to 3/1. Can you help me figure the actual payoff for $2.00? The total pool was $577,889 and $125,353 was wagered on my bet. Thank you for any help.
— Donald from Watervliet, USA
Thanks for the compliment. Let’s let c equal the track cut. If the odds closed at 5-2 then:
(577889*(1-c)-125353)/125353 = 2.5
So the track cut was 24%. For a futures bet this is not unusual. This illustrates why futures are a bad bet.
There is an online sport book that is offering a bet in which you are assigned a random horse (to win) and you receive a guaranteed payout of 15.3 for 1. There are 17 total horses listed. How would you calculate the house advantage on this bet? Does it matter what the odds are on the horses? If so, they are below. Thank you, and I apologize if this is a stupid question.
Assuming you had an equal chance at getting each horse then the probability of winning would be 1 in 17, regardless of how the odds on each horse were distributed. The player’s expected return can be expressed as (1/17)*15.3 + (16/17)*-1 = -0.0412. In other words the house edge is 4.12%. However there is another simple formula you can use. If a = actual odds paid and f = fair odds for bet then the house edge is (f-a)/(f+1). In this case the fair odds are 16 to 1. So the house edge is (16-15.3)/(16+1) = 0.7/17 = 4.12%.
Dear wiz: The horserace track that I attend is introducing video lottery machines. Can you tell me anything about them? Are they the same as slots? Any info you can give would be helpful and appreciated.
— Mike S.
Another Mike S., what are the odds? Lots of racetracks permit what is called "class 2" gaming, which must be lottery or bingo based. The way to offer slots under this rule is to have a lottery or bingo game going on behind the scenes and the outcome is displayed in the form of a slot machine win. For example if the lottery game determines that you win 20 times your bet it will display whatever slot machine symbols pay 20. So it is a clever illusion.
A small number of sports betters beat the games, in the long run, by arduous study, use of computers, etc. Are there bettors who use these methods to become long term winners at beating the horse races?
Betting on the horses is one of my weakest areas when it comes to gambling. I have heard that "bridge jumper" bets (a bet on a huge favorite to show) can sometimes be a good bet due to the guaranteed $2.20 minimum return on a $2 bet. However I know of no way to have a consistent edge or any person who is successful as a professional racetrack bettor. Yet I don’t deny the track can be beat. In the book Gambling Wizards
author Richard Munchkin tells the story about one professional gambler’s success at the racetracks in Hong Kong, where the track cut is less than in the United States.
How do the odds at the Greyhound tracks compare to the horse tracks?
— Ken from Antioch
I called the Naples/Fort Meyers
greyhound track in Florida. The person I was directed to said that the takeout, or track cut, ranged from 19% for the simple win, place, and show bets, to 21% for pick-2 bets like the quinella, to 25% for more exotic bets like trifectas. This is very similar to the takeout in Florida for horse racing
. From anecdotal information I have heard, the takeout is more or less the same everywhere between dog and horse racing.
Did you bet on your namesake, Shackleford, to win the Preakness ?
— Todo el Mundo
Unfortunately not. My reason is that I thought the world was going to end that day, May 21, 2011
, so I didn't think I would have enough time to spend any winnings.
Reason #2 why the Wizard likes Bovada:
No-hassle practice games
Most online casinos spend more effort trying to separate you from your money than they do trying to give you a good experience. They have all kinds of popup windows, they usually make you download their software, and if they do offer play-in-browser games then you have to register an account before you can play. And if you register they start sending you emails trying to get you to deposit real money.
But Bovada is different. They have no popup windows at all, and their practice games play right in your browser, with no download, and no registration required. You don’t even have to give up your email address. It couldn’t be simpler: just one click and you’re playing the game.
I wish all online casinos showed this much respect for their players. Other casinos practically ask for your first born child to play for free. Meanwhile Bovada is patient and does not twist anybody’s arm to play for real money. You can play as long as you like for free with no obligation. The real-money games are available if that’s your preference, but if not, you can play the free practice games for as long as you like without hassle.