Quote:
Originally Posted by sjk
Most would have a requirement that there be a cushion between the value presented by the public odds and the expected return based on a personally derived line, such as looking for opportunities where the overlaid value is 100% greater than the oddsline expected return. (I am using a requirement along those line)
Making a composite odds line really does nothing more than adjust the required cushion percentage. You can manipulate the inequalities and turn a requirement about a composite line into a requirement on the oddsline at a higher cushion percent.
SK
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This is exactly the way I think about it except without actually doing the math to create an odds line for every horse anymore.
I usually start by having a horse in mind to key on or against because of some trip, bias, trainer pattern, pace projection etc...that I think may present value. After scanning the field I have a very rough idea of where I think the horse fits. Before I pull the trigger, the odds are going to have to be screaming to me to make the play because I know I am sometimes dealing with inaccurate or incomplete information and understanding.
I call that my "margin of safety" (stolen from Ben Graham and Warren Buffett).
But I am really doing exactly what the modelers are doing when they adjust their odds lines to incorporate the public odds. They are creating a margin of safety.