Betting Overlays

[pandy]

http://www.drf.com/news/pandolfo-can-you-win-without-picking-winner

[DeltaLover]

http://www.drf.com/news/pandolfo-can-you-win-without-picking-winner

Some valid points are made here, but absolutely nothing new, since this way of thinking has been around for very long...

Also I do not think the following statement is correct:


I believe that most handicappers overestimate the chances of the obvious horses.


Do you see why?

[pandy]

The reason why I say that, let's look at public handicappers. Many of them pick the favorite in almost every race, even though it's impossible to win that way. They are over estimating the favorite, and many bettors do the same thing. I've never met a single person that bets chalks and wins, but I've met many who only bet longshots and win.

[DeltaLover]

The reason why I say that, let's look at public handicappers. Many of them pick the favorite in almost every race, even though it's impossible to win that way. They are over estimating the favorite, and many bettors do the same thing. I've never met a single person that bets chalks and wins, but I've met many who only bet longshots and win.

Sure, I completely agree that the way to show consistent winning is to be able to select long-shots.

This does not mean that the favourite is over-bet though! Quite the contrary.. Calculating the ROI of all the starters of the race, we will surprisingly see that the highest return is consistently on the favourite of the race, something the proves beyond any doubt that this is the horse that is systematically under-bet by the crowd, who tends to over-bet the longer shots. Of course there are some races where the crowd tend to be confused and there is where the profit can be made by betting a longer shot..

[thaskalos]

The reason why I say that, let's look at public handicappers. Many of them pick the favorite in almost every race, even though it's impossible to win that way. They are over estimating the favorite, and many bettors do the same thing. I've never met a single person that bets chalks and wins, but I've met many who only bet longshots and win.
You've met "many" who bet longshots and win? Just as many overestimate the favorite...I think many overestimate the chances of some of the longshots. The occasional longshot wins...and this leaves many of the more "ambitious" players in search of the next winning longshot. Of course, when they bet the promising longshot in the next race...then the favorite wins. And so it goes.

I think the player must employ handicapping methods which put him on a nice mix of favorites AND longshots. The extreme points are not where the profit lies. It lies somewhere in the middle. The trick is to remain consistent...and not be swayed by short-term results.

[pandy]

Not necessarily. Yes, there are players who play horses at all odds, or mix favorites with longshots. But all the favorites do is increase your win percentage, not your ROI.

Every winning horse bettor I know has several big hits a year that produce their profit, and those hits are normally from longshots they keyed correctly in exotics. I've never met a single professional horseplayer that bets to win, by the way, and I've never met one that bets favorites, unless he is using the horse in part of an exotic wager structure.

Yes, there are bettors who overestimate the chances of certain longshots, but still, there is much more leverage betting longshots.

I've heard this before, the favorite has the highest return...

It doesn't matter. The bottom line is, very few favorites are actually worth a bet and you can't win betting favorites. The only thing a favorite is good for is including it in exotics. As a win bet, there are few favorites that are worth a bet. There are a lot of 10-1 shots that are worth a bet.

[mrroyboy]

Here is the point. The favorite loses less than any other category betting blind. But it still loses. Of course you need a mix. It's just that finding value is getting harder.

[pandy]

You don't necessarily need a mix. Maybe you do, maybe some do. But you can certainly show a profit betting nothing but non-favorites. Now I'm talking about thoroughbreds here, not harness. Harness is different.

The problem with favorites, okay, let's assume a good handicapper has found a horse that lays all over the field on paper and for some reason seems to be a decent bet, say it's going off at 8-5 in a 8 horse field. Even if the horse is the best horse in the race, it may lose because it just didn't have it that day, or it gets a tough trip. It's very difficult to find legitimate overlaid favorites, and even if you do, the margin for error is too small. People fool themselves into thinking that they can bet favorites, but at the end of the year, if eliminate all of the favorites you bet to win, you'll usually find that your win percentage dropped but your ROI went up.

[ReplayRandall]

You don't necessarily need a mix. Maybe you do, maybe some do. But you can certainly show a profit betting nothing but non-favorites. Now I'm talking about thoroughbreds here, not harness. Harness is different.

The problem with favorites, okay, let's assume a good handicapper has found a horse that lays all over the field on paper and for some reason seems to be a decent bet, say it's going off at 8-5 in a 8 horse field. Even if the horse is the best horse in the race, it may lose because it just didn't have it that day, or it gets a tough trip. It's very difficult to find legitimate overlaid favorites, and even if you do, the margin for error is too small. People fool themselves into thinking that they can bet favorites, but at the end of the year, if eliminate all of the favorites you bet to win, you'll usually find that your win percentage dropped but your ROI went up.


Of course your post is in reference to non-rebated players......

[thaskalos]

Not necessarily. Yes, there are players who play horses at all odds, or mix favorites with longshots. But all the favorites do is increase your win percentage, not your ROI.

Every winning horse bettor I know has several big hits a year that produce their profit, and those hits are normally from longshots they keyed correctly in exotics. I've never met a single professional horseplayer that bets to win, by the way, and I've never met one that bets favorites, unless he is using the horse in part of an exotic wager structure.

Yes, there are bettors who overestimate the chances of certain longshots, but still, there is much more leverage betting longshots.

I've heard this before, the favorite has the highest return...

It doesn't matter. The bottom line is, very few favorites are actually worth a bet and you can't win betting favorites. The only thing a favorite is good for is including it in exotics. As a win bet, there are few favorites that are worth a bet. There are a lot of 10-1 shots that are worth a bet.

I believe that your conclusions here are wrong, Pandy...and I'll tell you why.

Yes...the vast majority of the "professional" bettors out there are betting the exotics...but that does't mean that they avoid win-betting altogether...and some of those win-bets are indeed on favorites. Some of these favorites are OUTSTANDING bets. Those successful players whom you mention may indeed depend on a handful of big tickets to make their annual profit...but it's the SMALLER tickets which they cash that allow them to remain in the game long enough for their "monster" tickets to click. Think of the home-run hitter in baseball. He may THINK of the long ball every time he steps up to the plate...but the fat pitch down the middle doesn't come often enough. So, he fouls off the questionable pitches at the corners of the plate...and will gladly accept a single, if that's all he can get. It's called "survival"...and the horseplayer faces it too. The horseplayer too must make sure that he is still at the plate when the fat pitch comes...and he must accept the small rewards as they come in order to remain in the game.

Yes...my annual profit might indeed come from a few big tickets...but I stay in the game long enough for those big hits to come, by cashing those small tickets. And these small tickets are often win-bets...or exotic tickets where favorites are keyed.

This is a difficult game...and you take what you can get.

[pandy]

I don't disagree. I have had years where I hit quite a few small exactas, which included the favorite, and, yes, it does make it easier from a psychological standpoint because whenever you have a higher hit rate, it's less stressful. But from a strict mathematical viewpoint, even if you're patient, there aren't that many good opportunities betting favorites. There's just not enough leverage.

When GOLD hit $1900 an ounce, I used it as an analogy to value-betting in my column. I said something like, obviously gold is not a good bet anymore at that price, the value is gone. I know nothing about gold, but as it turned out, I correctly picked the top in the market, simply because of common sense. It's hard to find value in favorites, and even if you can, there aren't enough solid plays to make any sort of realistic profit.

I've run many live tests of my methods on my website. I've tried several different tests of favorites, non of which proved profitable. I've tried several different tests of longshots, most of which proved profitable.

If we ran a test on this board where we had some of the better handicappers post their top 2 picks a day for 50 days, say 100 plays. One group must use horses that are 6-1 or higher, the other group can use any odds range. The group using the higher odds horses would most likely have a higher ROI.

Look at the contests. They are based on highest ROI. The people who consistently place high in those contests only use longshots. If the best way to show a profit in a contest is to bet longshots, then the best way to show a profit in real betting, is longshots.

[thaskalos]

I don't disagree. I have had years where I hit quite a few small exactas, which included the favorite, and, yes, it does make it easier from a psychological standpoint because whenever you have a higher hit rate, it's less stressful. But from a strict mathematical viewpoint, even if you're patient, there aren't that many good opportunities betting favorites. There's just not enough leverage.

When GOLD hit $1900 an ounce, I used it as an analogy to value-betting in my column. I said something like, obviously gold is not a good bet anymore at that price, the value is gone. I know nothing about gold, but as it turned out, I correctly picked the top in the market, simply because of common sense. It's hard to find value in favorites, and even if you can, there aren't enough solid plays to make any sort of realistic profit.

I've run many live tests of my methods on my website. I've tried several different tests of favorites, non of which proved profitable. I've tried several different tests of longshots, most of which proved profitable.

If we ran a test on this board where we had some of the better handicappers post their top 2 picks a day for 50 days, say 100 plays. One group must use horses that are 6-1 or higher, the other group can use any odds range. The group using the higher odds horses would most likely have a higher ROI.

Look at the contests. They are based on highest ROI. The people who consistently place high in those contests only use longshots. If the best way to show a profit in a contest is to bet longshots, then the best way to show a profit in real betting, is longshots.

This here is another mistake that I think you are making. You are comparing handicapping contests to REAL horse betting...and they are two completely different animals. In these contests...you have to score higher than the other contestants in order to claim your prize. Unless you score high on the leader board, you walk away empty-handed...even if your play was very profitable. THAT'S why the emphasis is on longshots in these contests. Because you have to outscore the others...not because longshot-betting is the more effective style of play.

Don't be fooled by those impressive handicapping contest winners; the REAL skill belongs to the winning "every-day" horseplayer. Just as the REAL skill belongs to the cash-game poker player...and not to the flashy tournament poker player -- who accumulates a bankroll one day...so he could lose it the next.

[pandy]

I don't see the proof. All tests I've run have shown that the more favorites you include in your wagers, the lower the ROI. And I've communicated with many good handicappers, several pros. The discussion usually revolves around horses that are not likely to be the favorite. I think some people are under the impression that there are these sharpies out there betting several thousand dollars on solid chalk plays and grinding out a profit. Never met anyone who does that.

[DeltaLover]

I don't see the proof. All tests I've run have shown that the more favorites you include in your wagers, the lower the ROI. And I've communicated with many good handicappers, several pros. The discussion usually revolves around horses that are not likely to be the favorite. I think some people are under the impression that there are these sharpies out there betting several thousand dollars on solid chalk plays and grinding out a profit. Never met anyone who does that.

Can you describe several of thus tests, so I can go ahead and simulate it and verify your results?

[thaskalos]

I don't see the proof. All tests I've run have shown that the more favorites you include in your wagers, the lower the ROI. And I've communicated with many good handicappers, several pros. The discussion usually revolves around horses that are not likely to be the favorite. I think some people are under the impression that there are these sharpies out there betting several thousand dollars on solid chalk plays and grinding out a profit. Never met anyone who does that.

The sharp players will discuss ideas with you...but they won't had over to you their complete playbook. That's part of being a "sharp player".

[Ray2000]

I just did a 5 week run of 868 races (picks posted daily here at PA) betting favorites to win and place.

http://www.paceadvantage.com/forum/showthread.php?t=116315&page=8&pp=15


How much more proof does one need.

Close to a 'push' even without rebates.

You can win betting faves if you stick with higher end odds >3/2

[thaskalos]

I just did a 5 week run of 868 races (picks posted daily here at PA) betting favorites to win and place.

http://www.paceadvantage.com/forum/showthread.php?t=116315&page=8&pp=15


How much more proof does one need.

Close to a 'push' even without rebates.

You can win betting faves if you stick with higher end odds >3/2
Of course you can. :ThmbUp:

And you can even win while betting on favorites with even LESSER odds...under certain conditions. These betting decisions are situational...and "hard-and-fast" rules don't apply.

[traynor]

Especially with the dismal win rate of favorites going off below 3/5. Mix apples and oranges with a bit of enchilada sauce and all you will get is a very strange mix. Simplistic, one-dimensional analysis often generates little more than semantic noise.

[ReplayRandall]

This here is another mistake that I think you are making. You are comparing handicapping contests to REAL horse betting...and they are two completely different animals. In these contests...you have to score higher than the other contestants in order to claim your prize. Unless you score high on the leader board, you walk away empty-handed...even if your play was very profitable. THAT'S why the emphasis is on longshots in these contests. Because you have to outscore the others...not because longshot-betting is the more effective style of play.

Don't be fooled by those impressive handicapping contest winners; the REAL skill belongs to the winning "every-day" horseplayer. Just as the REAL skill belongs to the cash-game poker player...and not to the flashy tournament poker player -- who accumulates a bankroll one day...so he could lose it the next.

There are two different spheres of thinking, logic and skill that cash-game and tournament players incorporate. There is overlap in these spheres to some extent, but not to the degree where a majority strategy works equally as well in both endeavors. So I am in agreement with the first half of your post. Where I disagree, thinking that the REAL skill is possessed by the everyday cash-game player and not equally as well by the tournament player, is blatantly incorrect. The creative intellect and strategy used by tournament players with constant changing dynamics as the tourney progresses, in relationship to where one is on the leaderboard and what quality plays one still has at their disposal requires tremendous skill, foresight and versatile strategy implementations according to the format. The learning curve is steep, the bankroll deep, intense focus and the long-term results more chaotic than the grind-for-a-living daily cash player, unless that player is an exclusive exotics player or a large no-limit cash player. In any game, the best players always possess REAL skill, and tournament players even more so creatively...........

[pandy]

I just did a 5 week run of 868 races (picks posted daily here at PA) betting favorites to win and place.

http://www.paceadvantage.com/forum/showthread.php?t=116315&page=8&pp=15


How much more proof does one need.

Close to a 'push' even without rebates.

You can win betting faves if you stick with higher end odds >3/2

Yeah, but as I said, I was talking about thoroughbreds. Harness is much different, there is no comparison. There isn't a computer handicapping method that will show a profit betting favorites in thoroughbred racing win and place, no way. Harness horses are much more consistent.

[thaskalos]

There are two different spheres of thinking, logic and skill that cash-game and tournament players incorporate. There is overlap in these spheres to some extent, but not to the degree where a majority strategy works equally as well in both endeavors. So I am in agreement with the first half of your post. Where I disagree, thinking that the REAL skill is possessed by the everyday cash-game player and not equally as well by the tournament player, is blatantly incorrect. The creative intellect and strategy used by tournament players with constant changing dynamics as the tourney progresses, in relationship to where one is on the leaderboard and what quality plays one still has at their disposal requires tremendous skill, foresight and versatile strategy implementations according to the format. The learning curve is steep, the bankroll deep, intense focus and the long-term results more chaotic than the grind-for-a-living daily cash player, unless that player is an exclusive exotics player or a large no-limit cash player. In any game, the best players always possess REAL skill, and tournament players even more so creatively...........

What I mean by "real skill" is the ability to function outside of the strict rules which exist in handicapping contests and poker tournaments. "Real skill", to me, is the ability to win in the everyday, normal environment that gambling presents...without having to rely on something "artificially made"...which is what I consider poker tournaments and handicapping contests to be.

I have traveled quite far on my poker journey...and have become acquainted with many of these well-known poker tournament "superstars". By and large, their financial standing, and their reputation within the community, don't impress me. "Skillful", as I like to use the word, does not apply to them.

I have also become acquainted with many cash-game "professionals". Some of them are household names...and most of them are completely unknown to the general public. But they have the bankroll, and the self-confidence, of a REAL winner...and their poker skill astounds me. That's what I call "real skill". Poker tournaments can disappear tomorrow...but these players will always be in the money.

You were right in this post of yours; the fault was mine for not defining what I meant more presicely.

[thaskalos]

Yeah, but as I said, I was talking about thoroughbreds. Harness is much different, there is no comparison. There isn't a computer handicapping method that will show a profit betting favorites in thoroughbred racing win and place, no way. Harness horses are much more consistent.

Point me to the computer thoroughbred handicapping method that will show a profit...PERIOD. Has it been sold yet?

[pandy]

well, there are betting syndicates using computers, but they only bet overlays in the pools.

Pace listed his contenders for the Breeders Cup and bet the ones that were overlays. Yes, a computer can do the same thing, and show a profit. But, there has to be an odds rule, and you have to bet non-favorites only. A computer can definitely show a profit if the user bets the overlays.

[pandy]

There are two different spheres of thinking, logic and skill that cash-game and tournament players incorporate. There is overlap in these spheres to some extent, but not to the degree where a majority strategy works equally as well in both endeavors. So I am in agreement with the first half of your post. Where I disagree, thinking that the REAL skill is possessed by the everyday cash-game player and not equally as well by the tournament player, is blatantly incorrect. The creative intellect and strategy used by tournament players with constant changing dynamics as the tourney progresses, in relationship to where one is on the leaderboard and what quality plays one still has at their disposal requires tremendous skill, foresight and versatile strategy implementations according to the format. The learning curve is steep, the bankroll deep, intense focus and the long-term results more chaotic than the grind-for-a-living daily cash player, unless that player is an exclusive exotics player or a large no-limit cash player. In any game, the best players always possess REAL skill, and tournament players even more so creatively...........

Some of the tournament players who consistently cash in these things have to be very good handicappers. Profit is proof. To do well in the tournaments you need a profitable ROI. If you can produce a profitable ROI on a consistent basis, as the best tournaments players do, you are a good handicapper.

[ReplayRandall]

Some of the tournament players who consistently cash in these things have to be very good handicappers. Profit is proof. To do well in the tournaments you need a profitable ROI. If you can produce a profitable ROI on a consistent basis, as the best tournaments players do, you are a good handicapper.

Pandy, do you play in Tournaments on a regular basis? If not, how many have you played, and for what buy-in? Have you ever qualified for the NHC?

[pandy]

I have only played in a few tournaments in Connecticut and New York, not the major tournaments in Vegas. I would love to and I'm serious thinking of getting involved next year.

[Robert Fischer]

Sometimes betting overlays is simply about an isolated long-shot angle, or a bad trip that you are betting back, but often an overlay presents itself because the favorite happens to be vulnerable.

[traynor]

Yeah, but as I said, I was talking about thoroughbreds. Harness is much different, there is no comparison. There isn't a computer handicapping method that will show a profit betting favorites in thoroughbred racing win and place, no way. Harness horses are much more consistent.

I both agree and disagree. Exactly as stated, with favorites defined as the one (or multi-horse) entry that goes off at the lowest odds in each race, of course I would have to agree with your premise.

However, there are different layers of meaning in the plural "favorites" that some may interpret more loosely as "low-priced entries" rather than THE favorite (as in "second favorite," "third favorite," etc.). In that case, it is relatively easy (with a bit of homework and study) to locate advantageous wagering opportunities that leverage very low-priced horses and a high strike rate into a decent (and sustainable) profit.

The cutoff point for thoroughbreds is nearly identical to that for standardbreds--3/5. At that point and below, profit is pretty much impossible, and that category would be lumped in with the generic term "favorite." Cull that group, and things get much better. As far as study goes, look at the "all favorites" group as a set, and "all favorites that go off at odds greater than 3/5" as a subset. That subset can be quite rewarding.

[pandy]

I've always wondered what the cut off point was. I thought you could go as low as 1-2 with harness. Thoroughbreds, however, even with a 3/5 starting point it's a tall task. Thoroughbreds just aren't consistent enough to bet favorites.

[pandy]

Thanks to everyone who contributed to this thread, very interesting input. Since it was a column about harness racing, and we got into the subject of betting favorites, there was a little confusion about that. I agree that it's possible to show a profit betting favorites in harness racing, but in my opinion, bets on favorites in thoroughbred racing are fool's gold.

And the problem with betting favorites in harness racing, yes, you may be able to show a profit on paper. But, how much money can you actually make? If you bet $100 on each horse that will knock down the odds and there goes the profit.

[traynor]

Thanks to everyone who contributed to this thread, very interesting input. Since it was a column about harness racing, and we got into the subject of betting favorites, there was a little confusion about that. I agree that it's possible to show a profit betting favorites in harness racing, but in my opinion, bets on favorites in thoroughbred racing are fool's gold.

And the problem with betting favorites in harness racing, yes, you may be able to show a profit on paper. But, how much money can you actually make? If you bet $100 on each horse that will knock down the odds and there goes the profit.

Depends on the track and the size of the mutuel pools. I have never been overly interested in "paper profits." To the best of my knowledge, the only profit that really matters is that which one can walk away with, in the real world. Conjecture about what might have been based on races not bet is pointless--other than as an intellectual exercise (and a not very good one at that).

The cutoff point is based on the real world, not research. That is, it is the odds available at the last moment one can make the bet/no bet decision, rather than the after-the-fact odds when the last wagers are included. Substantially more than $100 can be wagered without negatively influencing the odds at a sufficient number of tracks to keep anyone so inclined busier than they probably need to be.

[pandy]

$100 bet at the Meadowlands is just fine, other tracks it may be okay, Balmoral, Cal Expo some nights, Northfield, Yonkers, maybe Hoosier some cards. I think that's pretty much it. PA. and Del. tracks have small pools.

[traynor]

$100 bet at the Meadowlands is just fine, other tracks it may be okay, Balmoral, Cal Expo some nights, Northfield, Yonkers, maybe Hoosier some cards. I think that's pretty much it. PA. and Del. tracks have small pools.

I think Woodbine might be included in that lot (and a few others), and the bet size may be considerably larger than $100. It is a business, not a hobby. There are situations in which a sizable win wager is the best strategy, others in which the high probability winner can more appropriately be used in exotics.

Smaller tracks should never be dismissed as having "too small mutuel pools for a heavy hitter like me." Betting $1000 to earn $500 profit at Yonkers is silly when $100 can be bet in the exotic pools of a "lesser" track that generates the same profit.

[pandy]

Oh yeah, what am I thinking, Mohawk and Woodbine.