How to win money by picking losers

[gm10]

"The court documents show that just 15 per cent of what the syndicate earned from US racing over that 3½-year period was from selecting the right horses.

Their winnings on a correct punt were just $8 million – a figure dwarfed by the $44 million earned from losing bets with rebates attached."

http://www.trackdata.com.au/Story.asp?Id=1956

[hencicleva]

I take your point that large rebates are problematic but any rebate less than 100%won't make money on a losing bet. They obviously have a positive ROI before rebate, something that is ver hard to do on that kind of volume.

[TexasDolly]

Hen, His point is that they do win on losing bets BECAUSE of the rebates. There is nothing positive about the ROI on the
majority of the winnings without the rebate.
TD

[AndyC]

To win money by losing with rebates you still have to have enough skill to lose less than the amount of your rebate.

Poorly written article that left far more questions than facts actually provided.

[hencicleva]

I'm assuming the $8 million winnings is net profit on all bets before rebate, not the gross payout on wins. I think we can agree the article is not well written.
I would be interested to know if any true whales are in negative $net long term before rebate but I don't expect to learn the truth.

[Robert Goren]

It is possible to have a small negative ROI before the rebates and a small positive ROI after the rebate. That is cutting it pretty thin when you figure in some expenses and you better have a very large bankroll to bet with if you plan on making a living that way. You going to have to run a lot of money through the windows and you have to be careful not to kill your own odds to point where it is not profitable even with the rebates.
There is already a thread about this guy. He is a crook. He bet other people's money and kept the rebates for himself. Anybody can make money, if they steal it. At least till they get caught.

[Seabiscuit@AR]

Zeljko's USA operation over these 3.5 years could well have cost him about his $8 million he made in profit without rebates. He had a large number of staff working for him (and still does)

My estimate would be expenses over the 3.5 years would be about $8 million to $10 million plus maybe add another few million in startup costs

Without a rebate their operation would not have worked as they bet things

Now maybe if they don't have a rebate then they bet the races totally differently so they do make a profit. Even so their profit would have been nowhere near the over $40 million they made net of expenses over the 3.5 years

[VastinMT]

I'm assuming the $8 million winnings is net profit on all bets before rebate, not the gross payout on wins. I think we can agree the article is not well written.
I would be interested to know if any true whales are in negative $net long term before rebate but I don't expect to learn the truth.

This is the only interpretation that makes sense to me.

You could then divide the $44 million by the percentage rebate to arrive at the amount pushed through the figurative window, and then divide the $8 million by that total to find out what their non-rebate ROI is.