Betfair ending exchange wagering in NJ
 

From Thoroughbred Daily News:

"Beginning Oct. 1, Betfair will no longer accept exchange wagers from its New Jersey customers, ending a brief and unsuccessful experiment in the U.S. for a form of wagering that couldn’t overcome a number of obstacles that stood in its way of success."

https://www.thoroughbreddailynews.co...tting-exchange

It was doomed from the onset.

There’s no substitute for all the options offered through para-mutual wagering.

If you can’t compete in that betting environment then perhaps you should reconsider playing this great game at all.

And those of you who are constantly worried and perhaps agitated by the take-out %, remember that this percentage is only removed from the betting pools as the betting takes place. The odds and will-pays displayed show “What-You-See-is-What-You-Get” if you have a winning play. If that’s unacceptable, you always have the option to simply pass.

I would think that there should be much more concern about having a reasonably good personal hit frequency and profit margin, because whenever you lose the take-out is 100% of everything you’ve bet. That's a big difference and common sense dictates where the priorities should be.

Exactly, what kind of fool would want to know the actual odds of his bet when he makes it?

Frankly, your attitude makes me embarrassed to be a horseplayer.

It’s a tradeoff between small inefficient pools that can be skewed at the last second vs large efficient pools that are less likely to shift. Either way, 2:1 pays 2:1 regardless of takeout. The bulk of the complaining, imo, comes from the crowd that gets upset that the price on the chalk dipped on the last click, which should be a common sense expectation with all of the ADW money hitting the pools

Nitro, I think you're off track here, pun intended. The take out is critical in determining the number of players who can stay afloat and support the game with a higher handle. When the pot is raided by a larger rake, and especially when some of the coin siphoned off is returned to the "special" high rebate parties, it's a recipe for decline. The competition gets tougher, and the sharps are fighting with the squares and degenerate losers for the shrinking profits. Your view is similar to that of SRU (Still Riled Up) who insisted all wagers and payouts occurred in some sort of vacuum, and only other factors like hit rates and (positive) profit margins mattered.

Have you ever considered how your play would be altered if another 5 or 7 percent of profit were tacked on to those Sha Tin Q's you're always cashing? Would you bet more, maybe? Have you ever considered the fringe player, say a shop keeper in Hong Kong, who used to break even 20 years ago and push $100K through the windows each year, who now finds himself down $5K or $7K at the end of the year, due to the influence of the whales, computer teams, and rebates that he doesn't get, and has had to scale back his play to $10K per year instead to stop the bleeding?

Take a gander some time at the number of winning players in South America where takeouts are 25% or more in many of the pools. The result is $1500 purses, $1500 claimers, and horses that race 100 times in their career. Even a crack analysis of the insider wagering will pass an inflection point where profits are unattainable.

How many fans do you think will continue to play the races on the weekends when they can only find two races on card worth betting? That's what I'm experiencing. Back in the 1980s I would typically bet several hundred dollars on two or three races, fifty bucks on three others, and maybe five to 10 buck flyers on the other three, in a typical nine race card from NY. Today I bet several hundred dollars in a race maybe half a dozen times a year. A typical Saturday, I bet one or two races for 5 or 10 bucks, and maybe a medium sized bet once or twice a month. There's just not enough slosh in the pools now to make it a profitable or break even hobby. Hong Kong is a venue where I can still find a several races to bet heavier on for each card, but even there I have to be more selective than I was 15 years ago.

Exchange wagering represented a great boom in the UK, where gambling profits aren't taxed, and books can match bettors without having to pay off the tracks. Here in the states, the row was much tougher to hoe, with commissions required for purse reimbursements. Before the offshore crack down back in the early 2000s, I had an account at IASBET, where I could place fixed odds bets - and like exchange wagering, it sometimes provided a hedge against the parimutuel system's flaws, which have morphed into a number of decided negative influences in today's game.

But you can't fight city hall, and apparently can't fight the racing monopolies either, which is why more and more players are taking your advice and passing on races, whole cards, and whole years. Entirely.

“ What you see is what you get”?

Well I wait until after the first quarter to actually see what my win odds are because that horse I bet at 2-1 suddenly drops to even money for some odd reason.

To me, exchange wagering is far and away the greatest innovation in horse racing wagering in my lifetime as long as the spread and "rake" are modest enough to be similar to or lower than the track take.

The problem was getting all the major tracks to sign on so it could grow to critical mass in the US. There's also nothing wrong with both models co-existing. Most or all the exotics could be parimutuel and WPS and booking bets on an exchange.

Unless you've played on exchange you won't understand how terrible a development this is for horse players even if the tracks or others are happy about it.

" Betfair charged its New Jersey customers a 12% commission."

This is why it failed and why its thriving in Australia and doing well in UK/Ire.

Greedy ****ing horsemen and regulators all demanding their cut screwing over the horseplayer.

Betfair UK is 5% commission, Aus is 5-6.5% I believe depending on state.

Well I it was profitable until the end.

Yikes back to bucking the PM takeout.

Allan

Nitro is a joke, don't take his words seriously. The only reason he made that post was because he always says how great Hong Kong is but they have higher takeout than most U.S. tracks. That's his rationale for why he bets anyway.

Now, as far as the NJ exchange, they never had the top American tracks and they never developed enough liquidity to let you bet serious money on U.S. races, so they never brought in serious bettors. Restricting it to NJ residents, as we do here, also limited value too much. I tried exchange wagering and found those flaws keeping me from really putting any substantial money into it.

Hi Parkview.
Thanks for taking the time to provide your thoughts related to the impact of the track’s take-out percentages. I’ve heard similar comments over the years, and I would say that most players would probably agree with many of your points. However, as you probably realize I’m not like most players. While the majority of players think of themselves as “Playing the horses”, I think of myself as “Playing the Money”.

This goes hand-in-hand with the attitude and mentality that most horse players have toward approaching this game. Very few treat it like a business and more often than not, they don’t even bother keeping personal financial records (in business it’s called basic bookkeeping). However, there are also other very relevant aspects to treating your game like a business that lead primarily to securing a profit. My views are far from the idea that we’re all betting in a vacuum. I’ll not only explain why the hit rate frequency and profit margins are much more important than the take-out, they’re actually the bottom-line in terms of maintaining a healthy business outlook.

So, in my example (below) the business type I’ll use produces and sells expendable data through a number of distributors all over the country. For arguments sake we’ll say the data packages have a shelf-life of only 90 days (1 Quarter). There will be an obvious correlation to the items we’re concerned about like “take-out”, “hit frequency”, and of course “profit margin”.

I’ll try to keep things as straightforward as possible so that even the simplest minds (I won’t mention any names) can see what I’m getting at and can either agree or disagree with my argument. Also, note that I’m not shying away from the Take-out % and using the same % used in Hong Kong for both the Quinella (25%) and the Win (17%) type of bets.


A) The example shows (2) Quarters of a typical Distributor’s Inventory & Sales history.
B) The Take-out (distributor Discount) is a constant for each type Data package. So is the Profit Margin % for each package.
C) The 2nd Quarter is obviously more profitable. Not because the Take-out was reduced, but because the Hit frequency was increased and the losses reduced.
D) The Take-out is simply one of the costs of doing business.
Once that’s accepted, it has no real impact on Profit Margin fluctuations.

I’m not concerned with the % of take out. I don’t consider it “bleeding” and it has no affect on how much I bet. As I mentioned, the Hit Frequency is as far as I’m concerned a much more important factor to contemplate.

I’ve heard the same commentary about how the take-out continues to drain the pool as if at some point the pool will be empty. Well, I’ve been playing this game an awfully long time and I’m sure I’m not the only player that’s witnessed continuously filled and nice size betting pools at a majority of the mid-size to larger race tracks. Sure there’s been some patronage decline over the last 20 years, but it’s still funny how those same betting pools are continually filled on a daily basis.

Again if you’re looking for real “profitability” the 2 factors to consider together are Hit Frequency and Profit Margin on a race-by-race basis. As an example, you may have noticed that I’m when playing Hong Kong that I only make a 3 horse Dutch Win bet when the overall Profit Margin on the return is 50% or greater. That’s primarily because I know for a fact what my Hit Frequency is. (It’s not only known for specific individual race conditions, but for a typical 10 race card.) If I’ve hit 50% of the playable races on any race card, all remaining races are a Pass.

I’ve found that players who can control their number of plays and the size of their wagers on any given day are more prone to be successful than those just looking for betting action with uninhibited wagering. If you let the game get away and you lose control you’re destined for failure.
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Yeah, particularly when the best option available as a function of parimutuel wagering is wholly ignored by the industry all around.



Takeout, as a relative constant, has had approximately zero to do with the ongoing demise of horse racing, which has been a steady variable over 30-35 years.

Except that the pools have become more efficient. So that same "take" has become a tougher nut to crack and causes more people to drop out.

I become more convinced by the day I should focus more attention on smaller tracks and tracks/races with a some vacation or "big day" qualities and mostly avoid the major tracks in NY and CA where the pools are dominated by the sharpest players with access to most of the information I have and perhaps information I don't have.

Don’t kid yourself into believing that the “take-out” is causing people to “drop-out”. These same people you’re referring to are losing period! When you lose the take-out is 100% of your bet. The only way to overcome that is to either improve the hit frequency with a reasonable profit margin or accept a low hit frequency with an exceptionally high profit margin.

If the sharpest players with the deepest pockets are winning so much then why don’t we see favorites winning every race? After all, their heavy betting would be driving the prices down on every winner. That just isn’t happening even at the major tracks. (And when I say “major” I’m including Hong Kong). If the only information you’re using is past performance data then I would agree that your current (pre-race) information is certainly limited.

I would have bolded this line.

I don't understand how people expect to have anywhere near a breakeven ROI when they got to the track, buy their standard PP's and analyze it like 95% of the public does.