Buying a racehorse?

[fmhealth]

Here's a link to a finance site I enjoy. Apparently there are some owners & 'cappers there as well.

http://www.bogleheads.org/forum/viewtopic.php?f=11&t=118445

[VeryOldMan]

Here's a link to a finance site I enjoy. Apparently there are some owners & 'cappers there as well.

http://www.bogleheads.org/forum/viewtopic.php?f=11&t=118445

Not trying to derail the thread - just found it a bit surreal to see the underlying link about the economics of horse racing being discussed on a message board devoted to the philosophy of Jack Bogle, the patron saint of low-cost index investing.

What's the ROI on ownership, net/net, and what percentage of owners make money at this sport? From what I know about the economics of breeding and ownership, it is tough as hell to make money at this sport. There are some spectacular outliers that are like hitting Powerball, of course, but this is a tough game for the average owner I suspect. Others on this board who know the ownership economics can offers more informed opinions.

[chadk66]

there are alot of owners that make money in the sport. But alot that don't. The biggest problem I see with owners is they micromanage their trainers to the point of their own detriment. And too many make decisions based on what appears to be best for their wallet than what is best for their horse.

[lamboguy]

people spend a total of around $2 billion a year buying race horses chasing purses that might total $1 billion a year.

[DJofSD]

Owning a horse is just like a land-boat: a hole into which you pour money.

Now, before you jump down my throat, I've owned horses for both business and pleasure. If you go into the venture of owning horses, let alone racing them, with the idea of making money, you will regret it.

However, if love all of the other aspects of the ownership experience then whatever money does come out of it will just be gravy.

[onefast99]

Owning a horse is just like a land-boat: a hole into which you pour money.

Now, before you jump down my throat, I've owned horses for both business and pleasure. If you go into the venture of owning horses, let alone racing them, with the idea of making money, you will regret it.

However, if love all of the other aspects of the ownership experience then whatever money does come out of it will just be gravy.
There is no better feeling in the world than seeing your horse cross the wire first. No matter if it is a 5k claimer or a graded stakes winner!

[PICSIX]

Owning a horse is just like a land-boat: a hole into which you pour money.

Now, before you jump down my throat, I've owned horses for both business and pleasure. If you go into the venture of owning horses, let alone racing them, with the idea of making money, you will regret it.

However, if love all of the other aspects of the ownership experience then whatever money does come out of it will just be gravy.

I believe Cot Campbell wrote that if you must construct a projected P&L, use zero in the profit column. It was something like that in his book "Lightning in a Jar"

[chadk66]

There is no better feeling in the world than seeing your horse cross the wire first. No matter if it is a 5k claimer or a graded stakes winner!this is very true. and why the majority of the owners own horses. It's even more gratifying when it's one you bred and raised. It's like your own kid winning ;)

[onefast99]

this is very true. and why the majority of the owners own horses. It's even more gratifying when it's one you bred and raised. It's like your own kid winning ;)
That is the way I went in the past 3 years, I was tired of paying top dollar for claimers so breeding was perfect since we had 2 black type mares. In the past I bred several nice ones but sold them early on, Chief Counsel and Soveriegn Default were the two top ones.

[Fager Fan]

there are alot of owners that make money in the sport. But alot that don't. The biggest problem I see with owners is they micromanage their trainers to the point of their own detriment. And too many make decisions based on what appears to be best for their wallet than what is best for their horse.

Where did you come up with this? Seems a lot of theory stated as fact with probably zilch to back any of that up.

[elhelmete]

There is no better feeling in the world than seeing your horse cross the wire first. No matter if it is a 5k claimer or a graded stakes winner!

Correct. Very, very, very correct. :ThmbUp: :ThmbUp:

[Fager Fan]

One way to look at racehorse ownership is this:

Would you rather pay for a racehorse or broodmare, or would you rather pay federal income taxes?

Your small business losses could wipe out your federal income tax liability.

[chadk66]

Where did you come up with this? Seems a lot of theory stated as fact with probably zilch to back any of that up.
I know this because I trained for a number of years and now I own. I know the business from both directions lol. All owners want professional trainers but very few are professional owners. My brother, whom is an owner and barely knows which end of the horse craps, is always micromanaging the trainer. We go round and round all the time. I basically tell him if you can't trust your trainer to do what you think needs to be done then you have to train the horse yourself.

[Mineshaft]

I know this because I trained for a number of years and now I own. I know the business from both directions lol. All owners want professional trainers but very few are professional owners. My brother, whom is an owner and barely knows which end of the horse craps, is always micromanaging the trainer. We go round and round all the time. I basically tell him if you can't trust your trainer to do what you think needs to be done then you have to train the horse yourself.





Bingo we have a winner

[garyscpa]

One way to look at racehorse ownership is this:

Would you rather pay for a racehorse or broodmare, or would you rather pay federal income taxes?

Your small business losses could wipe out your federal income tax liability.

Yeah, if you spend 3 times your tax liability. :bang: