Takeout vs profits

[raybo]

Someone explain how track takeouts result in lower profits for the WPS wagerer. I know how it affects the exotics wagerer, smaller pools, thus smaller payouts. But when the win odds are known prior to wagering, how can the track takeout cause the winner to not pay those odds, and the resulting place and show odds?

[Valupix]

Someone explain how track takeouts result in lower profits for the WPS wagerer. I know how it affects the exotics wagerer, smaller pools, thus smaller payouts. But when the win odds are known prior to wagering, how can the track takeout cause the winner to not pay those odds, and the resulting place and show odds?
I won't at all if you play for value. The odds posted on tote board already have the takeout deducted. If you see a 5/1 final odds line, you will get $12 bucks (+/- breakage) regardless of what the takeout is. Of course nailing down a price in the ever moving world a pari-mutuels is a completely different issue.

Were it becomes a factor for value seekers/odds players is in the fact that on horses they want to play at a certain line, they will see those horses meet or exceed that line at a less frequent rate at higher takeout tracks than that of tracks with lower takeouts.

If you are a player who just bets a horse cold, regardless of what price range you may get, it will affect your ROI tremendously. At a track with a takeout of say 20%, you will obviously average 4% less per winning hit than that of a track with only a 16% takeout simply because you did not make odds an issue. In a game with such a small window to profitability that 4% of course reduce your overall ROI significantly.

Place and show get a little more complicated because place winnings are affected by the horse the place pool is split with and the show pool is affected by the other two horses the show pool is to be split with. Making it very difficult to get a feel for value in those pools. In my own opinion even for value players, high takeout significantly affects them in the place and show pools.

...or at least that's my opinions based on what I understand about pools and takeout. As with all my opinions I reserve the right to be completely clueless.;)

[1st time lasix]

the higher the take...the less you get paid for the enormous risk you are taking. Simple as that. Doesn't matter if it is win pools or exotic pools. The more you play over the course of any time period. ...the more the take erodes your return on investment. :bang:

[ranchwest]

Someone explain how track takeouts result in lower profits for the WPS wagerer. I know how it affects the exotics wagerer, smaller pools, thus smaller payouts. But when the win odds are known prior to wagering, how can the track takeout cause the winner to not pay those odds, and the resulting place and show odds?

The only difference is that win pools are usually expressed in odds, such as 2/1, whereas exotics are usually expressed in dollars. Both have the take already removed off the top.

When I first got started, I was at Delta Downs and their board showed win odds in dollars back then. It was a bit of adjustment for me to later see odds on the board.

[Jeff P]

Someone explain how track takeouts result in lower profits for the WPS wagerer. I know how it affects the exotics wagerer, smaller pools, thus smaller payouts. But when the win odds are known prior to wagering, how can the track takeout cause the winner to not pay those odds, and the resulting place and show odds?
The lower the track take the higher the mutuel payoff. This is true for all pools including WPS.

Take a hypothetical race where a total of 40k is bet in the win pool and 5k is bet on the race winner. The following table shows the effect takeout has on determining the win mutuel:

20.0 pct win takeout (TUP)

AMT BET AMT BET WIN
Win Pool ON WINNER Odds MUT
40,000 5,000 5.40 12.80



16.1 pct win takeout (EMD)

AMT BET AMT BET WIN
Win Pool ON WINNER Odds MUT
40,000 5,000 5.70 13.40
For the player who insists on minimum odds before placing a bet on his or her selections, all other things being equal, more opportunities can be found at tracks with a lower takeout as compared to tracks with a higher takeout.


-jp

.

[Overlay]

Yes, you'll get the odds posted on the tote board if you cash a win bet. But those odds are lower than they would have been if the track take had not been subtracted off the top of the total win pool before the odds were calculated and posted. It's the difference between what you receive based on the odds posted on the toteboard, versus what you would have gotten if there were no take, that you have to overcome in order to show a profit, because horses will not win at a rate corresponding to how often their toteboard odds say they should.

For example, because toteboard odds reflect the deduction of the take, a horse with 25% of the win pool bet on it (a natural 3-1 shot if there were no take) will pay (with a 15% take, for instance) only odds of (100-25-15) to 25, or 2.40-1, or $6.80, rather than $8.00. You have to make up that $1.20 difference (plus the similar differences on all the other winners you bet) by having to hit a higher percentage of winners to show a profit than if there were no take. If there were no take, horses paying $6.80 would win 29.41% of the time. But instead, as in this example, because of the 15% take, the $6.80 payoff corresponds only to a 25% winning percentage.

[rrbauer]

Someone explain how track takeouts result in lower profits for the WPS wagerer. I know how it affects the exotics wagerer, smaller pools, thus smaller payouts. But when the win odds are known prior to wagering, how can the track takeout cause the winner to not pay those odds, and the resulting place and show odds?

If the takeout was lower the WIN ODDS would be HIGHER. And the money returned via winning Place and Show bets would be more. If the house is taking out less money then there is more money to be returned to the players. It doesn't have to do with not paying out what is shown....it DOES HAVE TO DO WITH HAVING MORE TO PAYOUT and therefore there will be higher payout odds. The net amounts are always shown and what is being shown is what will be paid out, but if there is less takeout then there will be higher amounts to be paid out.....GET IT?

PM me if you want more explanation than this....

[raybo]

So, everyone that has posted a reply to my question is saying that the takeout is applied as each and every bet is made into the pool and each bet made reflects the track's takeout, in that particular bet's affect on the odds, if my reasoning is correct?

[ranchwest]

So, everyone that has posted a reply to my question is saying that the takeout is applied as each and every bet is made into the pool and each bet made reflects the track's takeout, in that particular bet's affect on the odds, if my reasoning is correct?

Well, there is a lag while the computer processes the wagers.

[Burls]

Here's a related question.

Does anyone think it's true that the best players tend to play the tracks that have the lowest takeout rates?

If so, then, ironically enough, it's actually harder to make money at tracks with lower takeouts because, on average, you are playing against sharper bettors and it's actually easier to make money at tracks with higher takeout rates because, on average, you are playing against less skilled, less experienced bettors.

[raybo]

Here's a related question.

Does anyone think it's true that the best players tend to play the tracks that have the lowest takeout rates?

If so, then, ironically enough, it's actually harder to make money at tracks with lower takeouts because, on average, you are playing against sharper bettors and it's actually easier to make money at tracks with higher takeout rates because, on average, you are playing against less skilled, less experienced bettors.

I doubt, at this time, that the best players tend to play tracks with the lowest takeouts. That is, however, one of the things HANA has discussed in meetings.

[raybo]

Well, there is a lag while the computer processes the wagers.

Thanks, ranchwest, I'm pretty ignorant on this subject of takeouts because I've never cared what the takeout was, only what the pool size is. And since I'm a superfecta player, I've only been interested in what the superfecta pool size was. Just trying to understand all the interest in track takeouts as they affect handicappers.

[JustRalph]

just remember, all the winners split the pot. If the pot is bigger, you get more.

Let's say you are one of ten winners. Would you rather split a 100 dollar pot or a 150 dollar pot, ten ways.

simple as that.

[Cangamble]

just remember, all the winners split the pot. If the pot is bigger, you get more.

Let's say you are one of ten winners. Would you rather split a 100 dollar pot or a 150 dollar pot, ten ways.

simple as that.
Big pools are really only relevant when it comes to pick 3's, supers, and other multiple race pools.
Unless, the pool is really small, like many harness tracks where a $20 bet on any horse over 4-1 can affect the prices a lot, pool size doesn't matter much.
If a horse is going off at 10-1, it would probably be attract the same ratio of win bettors whether there was $10,000 or $60,000 in the win pool

[njcurveball]

just remember, all the winners split the pot. If the pot is bigger, you get more.

Let's say you are one of ten winners. Would you rather split a 100 dollar pot or a 150 dollar pot, ten ways.

simple as that.

Not really simple, although on paper your point is valid.

One thing that is always missed is the fact that bet determination for a large percentage of the crowd is based on odds.

If the takeout is lowered on bets where the odds are posted clearly (win betting), the end result would probably be that lower priced horses get bet harder and higher priced horses wind up paying more.

It would be a very interesting experiment and was done on a much smaller scale a while ago with the triple crown and other stakes races being bet in separate pools. Even with different takeouts, the favorites in those races tended to go off at the same odds while the longer priced horses would have more variance.

Simply put, if Big Brown is 8-5 more people would bet than if he were 6-5.

Lower takeouts would probably help the longshot bettor much more than someone who plays the top 2 choices.

Jim

[raybo]

just remember, all the winners split the pot. If the pot is bigger, you get more.

Let's say you are one of ten winners. Would you rather split a 100 dollar pot or a 150 dollar pot, ten ways.

simple as that.

Thanks, yes I realize that fact. And it would be nice if the pools were higher, but I tend to just wager into pool sizes that offer a sizeable payout and hope I'm one of only a few that hit it. I can't control the pool sizes but I can control, somewhat, how many winners I have to split with by wagering on races where the public is less likely to have the winning combinations.