Quote:
Originally Posted by dilanesp
Let's add the breakage (California breaks to 10 cents on the dollar), so that's an additional 4.5 percent.
So the takeout is about 20 percent.
Now, let's take two pools, one a 10 horse field and one a field with three betting interests.
We'll put $300,000 in each pool.
In the first pool, if you bet $20 each time, you on average lose 9 times and then get paid on your 10th bet, an average of $160. Over 30 bets, you bet $600 and return $480.
In the second pool, if you bet $20 each time, you on average lose twice and get paid on your 3rd bet, an average of $48. Over 30 bets, you bet $600 and return $480.
Mathematically there is no difference in the world between a 20 percent takeout on a field with 3 betting interests and one with 10.
The reason why players prefer a field with 10 betting interests is because the probability of there being a play with positive expected value in any particular race is higher. That's true. But that would be true whether the takeout was 20 percent or 2 percent.
But there's no particular reason to think this is a bad bet because of the takeout. If you find 15 percent + breakage to be potentially beatable with larger numbers of betting interests, it should also be potentially beatable with three betting interests, with the caveat that you may have to wait longer between profitable spots. (Though maybe you don't have to wait so long if I am right that this bet is a hit with novices.)
|
You are overestimating the effect of breakage. No way it is 4.5% at the bigger field size. It varies and increases as payoffs get lower, but on average it adds about 1% to takeout. However, in this case, the payoffs will certainly average lower in a three horse field than a 10 horse field, so it will hurt more. That is the main culprit...lower field size means payoffs will be smaller and breakage hurts more.
You can't put a precise number on it because payoffs vary. However, lets say the average payoff for a three horse field is 5.10, and the average payoff for a 10 horse field is 12.10. Those may or may not be correct but they are close enough to make the point. A $2 bet paying 5.10 means breakage, which should average about 10 cents per winning bet (actually 9.5), cuts your profit by about 3.1%. (3.10 / 3.20) = .969. A 12.10 payoff is affected less by breakage. (12.10 / 12.20) = .992, or less than 1% additional breakage, or about 0.8%. That is a 2.3% difference and will be quite meaningful long term.
For those wondering, breakage should average about 9.5 cents per $2 bet on the California rate because it will range from 0 to 19 cents. Over a large sample it should come out to about 9.5 cents.
