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View Full Version : Exchange Wagering: Betfair-TVG submission to the California Horse Racing Board


andymays
12-06-2011, 10:19 AM
If you're interested in the proposal made by Betfair for California read the PDF.

andymays
12-06-2011, 11:03 AM
http://blog.horseplayersassociation.org/2011/12/horse-racings-churn-rate-gets.html

Horse Racing's Churn Rate Gets Annihilated
For as long as we all can remember, horse racing's publicized churn rate (the number of times you as a player, collectively, roll over your bankroll, explained in detail here) was 7. If everyone at the track had $100,000 in their pockets, chances are handle would have been somewhere around $700,000.

Two major variables that go into the churn rate, as the article alludes are:
• Takeout rate - the higher the takeout, the lower the churn
• Cashable bets - WPS pools, with no exotics would have high churn because we'd have many winners rebetting, a card with pick 6's and nothing else would have almost zero churn, because we have one or two winners, who probably go home to celebrate after they win.
TVG, while submitting their application for exchange wagering in California, provided us with a shocking statistic: The estimated churn rate of 2011 TVG customers is not seven, but four.

Today, at a churn rate of four, that handle in our example has plummeted to $400,000.

For the whole story click on the link! http://blog.horseplayersassociation.org/2011/12/horse-racings-churn-rate-gets.html

redshift1
12-06-2011, 01:06 PM
I think this helps as well:

http://blog.horseplayersassociation.org/2011/01/what-is-churn-anyway.html

davew
12-06-2011, 01:17 PM
TVG is an ADW isn't it?

how do they calculate a churn rate>



if I had $500 in my account with them and placed zero bets this week on their 200+ race cards available, what would be my churn rate?

redshift1
12-06-2011, 01:24 PM
For the period you are not betting your churn rate is zero.

http://en.wikipedia.org/wiki/Churn_rate

satrabyk
12-06-2011, 02:05 PM
Does this mean exchange wagering will be offered on/for California tracks/residents only ? If so, liquidity will most likely be very low. Betfair is available to Canadians and yet hardly anyone bets there ????

The 10% commission rate is a joke. I know Canadians that have given up on Betfair and they were only paying 3->5 % - suspicious betting patterns. I quit betting there when I heard from reliable sources that some U.S. trainers are making more money on Betfair than on training!!!!!

Used to be good(more honest) years ago. Good Luck.

Some_One
12-06-2011, 02:22 PM
Since you're not willing to name names satrabyk, here's a couple I've seen with unusual activity (not presuming anything, just saying usually these trainers will have horses every once in a while that trades unusually). When they had Cali racing, you always knew when a Carla Gaines horse was live, it traded very close to the tote price when it was good and at a huge discount when it wasn't. Also Jamie Ness does too, but more so in Tampa it seems (on Sat, he had a horse trading at .9-1 when it went off around 6-5, and won of course).

As for the 10%, I would still play on BF markets as it's still for the most part a better deal than the totes and the liquidity from Cali players would make good markets (assuming that they can play the same pools as us).

andymays
12-06-2011, 02:47 PM
Does this mean exchange wagering will be offered on/for California tracks/residents only ? If so, liquidity will most likely be very low. Betfair is available to Canadians and yet hardly anyone bets there ????

The 10% commission rate is a joke. I know Canadians that have given up on Betfair and they were only paying 3->5 % - suspicious betting patterns. I quit betting there when I heard from reliable sources that some U.S. trainers are making more money on Betfair than on training!!!!!

Used to be good(more honest) years ago. Good Luck.
It is for California Residents only.

therussmeister
12-06-2011, 02:56 PM
http://blog.horseplayersassociation.org/2011/12/horse-racings-churn-rate-gets.html


TVG, while submitting their application for exchange wagering in California, provided us with a shocking statistic: The estimated churn rate of 2011 TVG customers is not seven, but four.

Today, at a churn rate of four, that handle in our example has plummeted to $400,000.

For the whole story click on the link! http://blog.horseplayersassociation.org/2011/12/horse-racings-churn-rate-gets.html

If I did business with TVG, I would deposit several times the amount that I normally bring to the track each day, so for me at least, that would explain the low churn.

satrabyk
12-06-2011, 03:22 PM
Thanx Andymays for reply.... do you know if it's going to be available for Cali tracks only ?


WOULDN"T IT BE BETTER IF TRACKS JUST REDUCE TAKEOUT TO 10 % - THEN THEY DON'T HAVE TO GIVE THOSE LEECHES ANYTHING ?????? Betfair and others will have to close down.... sell TVG and go back to ENGLAND !!!

andymays
12-06-2011, 03:24 PM
Thanx Andymays for reply.... do you know if it's going to be available for Cali tracks only ?


WOULDN"T IT BE BETTER IF TRACKS JUST REDUCE TAKEOUT TO 10 % - THEN THEY DON'T HAVE TO GIVE THOSE LEECHES ANYTHING ?????? Betfair and others will have to close down.... sell TVG and go back to ENGLAND !!!

I believe so but I'm not positive. In todays environment Tracks can't lower the take to that rate. It would be hard to get them to make it 14% across the board.

Charli125
12-06-2011, 04:12 PM
If I did business with TVG, I would deposit several times the amount that I normally bring to the track each day, so for me at least, that would explain the low churn.

Churn rate doesn't take into account how long it takes you though, so the amount you deposit doesn't have much impact.

It's not saying, "you'll turn your bankroll over x number of times in y period of time".

It's saying, "you'll turn your bankroll over x number of times before it's gone".

For example, say you deposit $500 into your account and you bet $2,000 with a net loss of $500 leaving you with a balance of $0. Your churn rate is 4 because you bet a total of 4 times your original bankroll before it went to zero. If you deposited another $500 when your balance was down to $100 so at the end of the above period you still have $500, your churn rate would still be 4.

davew
12-06-2011, 04:22 PM
I think they must be talking about different things then

betting bank roll churn rate -> total bet before roll gone $500 roll bets $2000 volume before gone

Daily on track churn rate -> total bettors cash betting handle multiple of original cash bankroll?

edmond1
12-06-2011, 04:31 PM
Betfair will agree to 10% commission??? Interesting to see reaction of racetrack officials of other tracks that have deals with Betfair (2-5%).

Also, if California markets are available to existing Betfarians who pay (2-5%) things can get interesting.

Judge Gallivan
12-06-2011, 04:57 PM
10% commission would be much more attractive to many Betfair players who pay from 2-5% but have to pay premium charges ranging from 20-60%.

I assume they won't be introducing premium charges for California Betfair.

andymays
12-06-2011, 05:12 PM
My opinion is that they're going to say whatever they need to say to get approved and provide the details later. That's how things work out here. Especially over the last couple of years with Keith Brackpool as Chairman of the CHRB.

Canarsie
12-06-2011, 05:33 PM
I really don't see how they are going to pull this off. Why would NYRA, CD, Stronach, etc. let their signal be sent to California if their not getting a cut their accustomed to.

Does anybody have an idea what's a tracks cut from the exchange wagering in the United Kingdom? I might be brain dead but isn't it zero or something really small?

andymays
12-06-2011, 05:34 PM
I really don't see how they are going to pull this off. Why would NYRA, CD, Stronach, etc. let their signal be sent to California if their not getting a cut their accustomed to.

Does anybody have an idea what's a tracks cut from the exchange wagering in the United Kingdom? I might be brain dead but isn't it zero or something really small?
There is a lot of "approve it now and we'll give you the details later" stuff going on. I'm for giving it a shot but I want the details.

Canarsie
12-06-2011, 05:46 PM
There is a lot of "approve it now and we'll give you the details later" stuff going on. I'm for giving it a shot but I want the details.

That's the problem with Betfair they never give up any info. I found out on a blog here in NJ that they hired Tom Cassidy well over two weeks before they announced it. When the cuts were made there was never a comment from them.

http://www.monmouthpark.com/Blogs.aspx?id=5463&blogid=147

What about the security breach not a PEEP.

Think about what I'm saying that they almost NEVER do a PR release to my knowledge. Didn't someone post they were going high def I see that got off the ground really well. Here's an interview from Keeneland VP Nicholson

We’ve been encouraging TVG to go HD for some years now and I’m glad that they are. I was glad to see them make the decision.”

http://horseracing.bloginky.com/2011/10/07/qa-with-keeneland-president-nick-nicholson/

edmond1
12-06-2011, 06:20 PM
Other exchanges (Betdaq/Betmaker) should benefit from this , right ??

They charge low commissions (currently 2.5%) and no premium charges. Don't think they contribute anything to U.S. racetracks though. Not sure if Betfair contributes anything to U.S. tracks they offer now.

I am from Canada and also find that there is very little interest here when it comes to Betfair. Go out of the way to show fellow punters the benefits of an exchange(2-5% takeout) .... but most of them rather continue betting into 20-30% takeout pools.... Really don't think it will work out in the U.S. especially at 10%. Even then deals are hard to find these days - too much smart money.. Better to bet at rebate shop in many cases now.

Seabiscuit@AR
12-06-2011, 08:07 PM
The drop in churn rate from 7 to 4 I would put down to the combination of high takeout rate plus big rebates. When you rebate one group of people you are effectively raising the takeout for the other non rebated group in the pools. These non rebated players then lose their money faster than ever to the rebated players

Over time the non rebated players drop out of the game as it is not as much fun anymore. At the same time the rebate players being mostly value seeking and price sensitive players drop their bet sizes so they don't hurt their own value prices by over betting them. End result pools dropping an alarming rate

This is the long term effect of rebating after the short honeymoon period in the earlier years when the pools go up a fraction as the rebated money bets up big

DeanT
12-06-2011, 09:01 PM
I disagree on that.

I can pop $500 in an account at 2:35 on a Saturday (rebated or non-rebated) and lose the five bills by betting seven or eight races, all stocked with mucho exotics, by 3:15. It matters not if some dude is getting a 5% rake boost.

Twenty years ago I would bet the first at Woodbine at 1PM, with WPS only. Bet $5, $10, $15, cash a show, break even, do it in the second, but bet $60 win and a couple of $20 exs, b/c there is no tri wagering, or another track to play. Lose that one, live for the third a half hour later.

In a half hour I have lost 15% of my bankroll. Now, in a half hour I could lose the GDP of Albania.

Some_One
12-06-2011, 09:47 PM
I don't understand how anyone can say there is too much smart money on the exchanges, horses 95% of the time go above their tote odds, so you will get a better price essentially. Just sounds like another cry of the degen loser handicapper.

Seabiscuit@AR
12-07-2011, 07:02 AM
DeanT

Yes you are right in that there are probably more exotic bets out there these days. And these exotic bets are mostly at a higher takeout rate than win and place bets so players lose their money faster. I agree with that

But gifting huge rebates to certain players makes things worse. And guess which pools these big players with the big rebates like to play most of all? It is not win or place. It is the exotics (with one exception being the place tote plunger on the Tassie tote). The people with really big rebates like to get stuck into the exotic pools. And as the takeout is bigger for the exotics they get given a bigger rebate for the exotic pools. So their advantage over the non rebated player is bigger and the speed at which they drain the non rebate players accounts is even faster than in the win pool

So the reason for players losing their money faster is a combination of more money in exotics and rebates

DeanT
12-07-2011, 12:25 PM
A blogger looks at the (not popular and probable handle killing in the short term) view of making less bets available instead of more.

Good analytical piece, whether we agree or disagree!

http://www.equinometry.com/2011/12/07/options-betting-horses/

Al Gobbi
12-07-2011, 01:12 PM
How about spending some of this money to show a few more tracks guys. Just Aqueduct until Hawthorne starts at 2:40pm. No Parx, Tampa, Chester or anything else before then.

cj
12-07-2011, 05:16 PM
A blogger looks at the (not popular and probable handle killing in the short term) view of making less bets available instead of more.

Good analytical piece, whether we agree or disagree!

http://www.equinometry.com/2011/12/07/options-betting-horses/

I agree, and have for a while. By giving more options, you are diluting the pools. This may not matter much to the guy betting $10 or $20 a race, but it matters a lot to guys betting $500. I'm not sure why racing is catering to the former.