Bring Hong Kong handicap racing model to U.S.

[highnote]

I posted the message below in a thread called "If you were racing Czar". It did not get much traction. Maybe because the following message was buried too deeply in the thread. I think this topic is worthy of a new thread because it discusses ways to improve racing in the U.S.

By improving racing I mean increasing handle, running more races with larger fields, illuminating race-day drugs, increasing stallion demand for more durable runners, increasing the number of owners, and giving more work to jockeys and trainers.

Comments welcomed!

Here is a brief outline:

CONCEPT

Add a Hong Kong-styled handicap division.

Maintain a separate, but fixed size population of horses that compete ONLY in the handicap division. This is in addition to the regular-type of racing that currently exists at tracks that I call the Open division.

Horses in the handicap division would be stabled separately from horses in the OPEN division.

Handicap divison stables are under 24-7 video surveillance.

Only state-authorized vets are allowed to administer therapuetic drugs, post race.

No pre-race, race day drugs are allowed to be administered.

Horses must be drug tested prior to racing and must be clean before they can race.

Here is a link to a description of the handicapping system used in Hong Kong:

https://racing.hkjc.com/racing/engli...cap_policy.asp

This could be adapted and modified to what would work best in a particular U.S. racing jurisdiction.

IMPLEMENTATION

Start small to see if the concept is workable.

It is probably not prudent to gather 2,000 horses for a handicap division given the risk of failure.

It is better to start small and then iterate the model until it is proven to work or not work.

If it fails after many iterations then pivot in a new direction or stop altogether.

The goal is to get 14 horse fields in every race, or whatever the typical maximum number of runners are at a given track.

In order to do average 14 horses per race 16 horses would need to be entered per race which would allow for two early scratches to be filled.

If one handicap race were carded for each class per racing day and this was done one day per week then 80 handicap division horses per day would be needed. Since the goal is to race these horses every 4 to 6 weeks a 6 week supply of runners would be needed. That is 480 horses.

It could probably be done on an even smaller scale with fewer horses by running three classes per day one day per week. For example, race Classes 1, 2, and 3 in week one. Then race Classes 4, 5, and 1 in week two. Then race Classes 2, 3, and 4 in week three, etc. This would require only 48 horses per week or about 300 horses for the 6 week rotation. Truthfully, the track could shoot for 10 horses per race with 2 standby runners. So then all that would be needed are 36 horses per day -- or about 216 horses for a six week rotation. Of course, it could be done on an even smaller scale and the feedback generated would still be useful.

New infrastruture would be required.

The horses would be need to be stabled in an area reserved for handicap class horses.

The horses would need to be under 24-7 video surveillance.

A roster of state-authorized vets each would be assigned to X number of horses.

This could make it easier to trace where any corruption occured if there were drug positives.

A set of rules would need to be drafted.

For example, a horse in the handicap class must be stabled at the track and cannot ship to another jurisdiction to race, otherwise, it loses it's eligibility to race in the track's handicap division.

Maybe a contract would be necessary that requires the trainer or owner to agree to race the horse for X amount of time at the track before it can be removed, unless it is retired? Then once it is retired it is never again allowed to race in the handicap division if it comes out of retirement to race again.

An owner can only own X amount of handicap horses.

An owner can retire a horse and replace it with another.

[iamt]

Does this really need a third thread to try and get attention?


Instead of getting lost maybe people decided it was easier to let slide than rebut your ramblings.


But here goes:


Hong Kong is always brought up as the ideal market especially as it has exported its product in recent years, but the largest wagering market in the world is actually the JRA in Japan who handle about 50% more than HK (admittedly on about three times the racing).


The JRA runs a system very similar to a MSW and ALW structure, with set weight races, so racing does need need handicap divisions to thrive.


The question then is what separates HK and Japan from the US.

• They are both very restricted gambling markets
• Culturally wagering on horses is ingrained and a major focus.
• Racing is considered a major sport
• Horse Ownership is somewhat of a status symbol, with HKJC and JRA being very restrictive in who can enter the industry

When a previous poster on one of your other threads commented about a culture change, these points would have been part of it.


As it stands HK isn't an appealing product just because of its integrity measures etc, it is appealing because the pools are huge and can support just about anyone entering into it. If Nebraskan racing implemented all the same measures as HK, it would be a bust because the wagering isn't there for any fresh bettors.


As for your idea (Best Case):


You have 14 horse fields with runners running every 4-6 weeks.. with a month off. Say a horse gets 8 starts a year in.


Lets make the purse higher than NYRA currently offers at $100,000 a race. 14 runners handicapped with an even chance of winning and each horse (on average) should earn $7,000 a start... over 8 starts horse should be expected to earn $56,000 a year.


Take out the Jockey and Trainer shares and we're down to somewhere near $45,000 a year to cover recurring expenses, and not considering purchasing etc. Basically much like now an owner can expect to lose money on the deal, and that is with the inflated purses... so without a culture change or the status symbol who is going to buy a horse to race?




Without horses we don't need to get into the wagering increase you would need to cover not just the purses but also all the additional security you are advocating, that would need to be about 4 times the current level of betting on a NYRA race.




The idea on just about every level is a non-starter.

[highnote]

Originally Posted by iamt

Does this really need a third thread to try and get attention?

Yes. For the same reasons psychologists say that it takes a viewer 16 times of seeing an ad before the ad generates a response.

Instead of getting lost maybe people decided it was easier to let slide than rebut your ramblings.

That is a distinct possibility. But you responded after 3 tries. So maybe I'm on to something.

But here goes:

Thank you. Your reply is much appreciated.

The JRA runs a system very similar to a MSW and ALW structure, with set weight races, so racing does need need handicap divisions to thrive.

Well, there you go. A handicap division might give a boost to U.S. racing.

The question then is what separates HK and Japan from the US.

[*]They are both very restricted gambling markets

U.S. racing is highly regulated and it is restricted. U.S. racetracks are still operated like monopolies. When was the last time a new racetrack opened up across the street from an existing track and the new racetrack had a different owner than the existing racetrack. In a free market this could happen.

[*]Culturally wagering on horses is ingrained and a major focus.

Legal gambling has exploded in the U.S. in the past 25 years. Sports betting will soon be allowed.

[*]Racing is considered a major sport

The breeders' cup and triple crown races get major network coverage as well as the triple crown prep races. Not to mention all races combined in the U.S. equals a very big sporting market.

[*]Horse Ownership is somewhat of a status symbol,

Have you ever seen the saddling area at the NYRA tracks or the winner's circle at most tracks. It is all about status. The Saratoga saddling area epitomizes the Status Symbol Land that Carole King wrote about in "Pleasant Valley Sunday".

with HKJC and JRA being very restrictive in who can enter the industry

This is what makes HKJC handicap races desirable from an ownership standpoint and is what the U.S. is lacking. The same rules could be adopted here -- limit ownership to handicap horses to 4 per owner.

When a previous poster on one of your other threads commented about a culture change, these points would have been part of it.

I don't see that much of a culture change is needed. Awareness of the new handicap division is all that is needed.

As it stands HK isn't an appealing product just because of its integrity measures etc, it is appealing because the pools are huge and can support just about anyone entering into it. If Nebraskan racing implemented all the same measures as HK, it would be a bust because the wagering isn't there for any fresh bettors.

A $50 bettor on KY Derby Day is not going to have any more affect on the pool than a $50 bettor on a Wednesday in February at Aqueduct.

As for your idea (Best Case):


You have 14 horse fields with runners running every 4-6 weeks.. with a month off. Say a horse gets 8 starts a year in.


Lets make the purse higher than NYRA currently offers at $100,000 a race. 14 runners handicapped with an even chance of winning and each horse (on average) should earn $7,000 a start... over 8 starts horse should be expected to earn $56,000 a year.


Take out the Jockey and Trainer shares and we're down to somewhere near $45,000 a year to cover recurring expenses, and not considering purchasing etc. Basically much like now an owner can expect to lose money on the deal, and that is with the inflated purses... so without a culture change or the status symbol who is going to buy a horse to race?

If every owner of a race horse in the U.S. made money under the current system owners would be clamoring to get into the business. Purse size is correlated with handle size. Handicap races should prove popular because of their large field size and exciting finishes. This in turn should generate more handle. More handle equals higher purses. Higher purses equals more competition. And if ownership is restricted to 4 horses the limited supply will increase demand. The harder to get, the better to have.

Without horses we don't need to get into the wagering increase you would need to cover not just the purses but also all the additional security you are advocating, that would need to be about 4 times the current level of betting on a NYRA race.

I have not calculated the cost of security. Cameras, monitors, and digital recorders are not expensive. How did you come up with 4 times the current level of betting needed?

The idea on just about every level is a non-starter.

If what you say is correct then it might be a non-starter. I think I have shown that there is another side to every one of your points. If mine are correct then it is not only a starter, but it's a grand slam.

The alternative is the status quo and racing in the U.S. will continue to slowly die until it collapses all at once. Sad, but realistic.

I did my part. I shared some ideas, but probably no one in a position to do something will ever notice. That's just the way it is. C'est la vie.

In the meantime, there are 8 nice races to bet at Happy Valley several hours from now.

[castaway01]

Originally Posted by highnote

If what you say is correct then it might be a non-starter. I think I have shown that there is another side to every one of your points. If mine are correct then it is not only a starter, but it's a grand slam.

The alternative is the status quo and racing in the U.S. will continue to slowly die until it collapses all at once. Sad, but realistic.

I did my part. I shared some ideas, but probably no one in a position to do something will ever notice. That's just the way it is. C'est la vie.

In the meantime, there are 8 nice races to bet at Happy Valley several hours from now.

Your argument got crushed into a little ball by iamt, so no need to revisit it. But when you say things like "Racing is a monopoly in the United States" you sound clueless. It's a monopoly in Hong Kong too---a government-run monopoly. You continually overlook the fact that the government controls all gambling there and takes all the money from it. That's not the case here. It's gives them room to run tracks WHERE TAKEOUT IS NO BETTER THAN THE UNITED STATES (which would be my only reason for wanting to bet Hong Kong, if I actually got a better return on my bets, which we don't) and still make a fortune.

Most racetracks here are struggling to hold on. There isn't room to expand, or build competing tracks. For years, the only reason to do so was to get a casino license. Perhaps that market is largely saturated now, or maybe we'll find more casino locations someday. At any rate, *most* racetracks don't make much money on horse racing. That's why there is a resistance to change, that's why there isn't a ton of money to experiment with, that's why there's a reluctance to suddenly change the drug rules. It's money. Until you make horse racing lucrative on its own you're not going to get people throwing money at it to run racetracks with handicap divisions. You'd have to tear racing down from the ground up, but without the government paying for everything like in Hong Kong.

[thaskalos]

A high takeout on a 14-horse field is WAY more inviting than the same takeout on a 5 or a 6-horse field.

[jeebus1083]

Is your name Walt Gekko? 🙄

Originally Posted by highnote

I posted the message below in a thread called "If you were racing Czar". It did not get much traction. Maybe because the following message was buried too deeply in the thread. I think this topic is worthy of a new thread because it discusses ways to improve racing in the U.S.

By improving racing I mean increasing handle, running more races with larger fields, illuminating race-day drugs, increasing stallion demand for more durable runners, increasing the number of owners, and giving more work to jockeys and trainers.

Comments welcomed!

Here is a brief outline:

CONCEPT

Add a Hong Kong-styled handicap division.

Maintain a separate, but fixed size population of horses that compete ONLY in the handicap division. This is in addition to the regular-type of racing that currently exists at tracks that I call the Open division.

Horses in the handicap division would be stabled separately from horses in the OPEN division.

Handicap divison stables are under 24-7 video surveillance.

Only state-authorized vets are allowed to administer therapuetic drugs, post race.

No pre-race, race day drugs are allowed to be administered.

Horses must be drug tested prior to racing and must be clean before they can race.

Here is a link to a description of the handicapping system used in Hong Kong:

https://racing.hkjc.com/racing/engli...cap_policy.asp

This could be adapted and modified to what would work best in a particular U.S. racing jurisdiction.

IMPLEMENTATION

Start small to see if the concept is workable.

It is probably not prudent to gather 2,000 horses for a handicap division given the risk of failure.

It is better to start small and then iterate the model until it is proven to work or not work.

If it fails after many iterations then pivot in a new direction or stop altogether.

The goal is to get 14 horse fields in every race, or whatever the typical maximum number of runners are at a given track.

In order to do average 14 horses per race 16 horses would need to be entered per race which would allow for two early scratches to be filled.

If one handicap race were carded for each class per racing day and this was done one day per week then 80 handicap division horses per day would be needed. Since the goal is to race these horses every 4 to 6 weeks a 6 week supply of runners would be needed. That is 480 horses.

It could probably be done on an even smaller scale with fewer horses by running three classes per day one day per week. For example, race Classes 1, 2, and 3 in week one. Then race Classes 4, 5, and 1 in week two. Then race Classes 2, 3, and 4 in week three, etc. This would require only 48 horses per week or about 300 horses for the 6 week rotation. Truthfully, the track could shoot for 10 horses per race with 2 standby runners. So then all that would be needed are 36 horses per day -- or about 216 horses for a six week rotation. Of course, it could be done on an even smaller scale and the feedback generated would still be useful.

New infrastruture would be required.

The horses would be need to be stabled in an area reserved for handicap class horses.

The horses would need to be under 24-7 video surveillance.

A roster of state-authorized vets each would be assigned to X number of horses.

This could make it easier to trace where any corruption occured if there were drug positives.

A set of rules would need to be drafted.

For example, a horse in the handicap class must be stabled at the track and cannot ship to another jurisdiction to race, otherwise, it loses it's eligibility to race in the track's handicap division.

Maybe a contract would be necessary that requires the trainer or owner to agree to race the horse for X amount of time at the track before it can be removed, unless it is retired? Then once it is retired it is never again allowed to race in the handicap division if it comes out of retirement to race again.

An owner can only own X amount of handicap horses.

An owner can retire a horse and replace it with another.

[rastajenk]

When owners and trainers opt out of participating in the Gulag of the Hong Kong experiment, you might end up with 5- and 6-horse fields anyway.

[thaskalos]

Originally Posted by rastajenk

When owners and trainers opt out of participating in the Gulag of the Hong Kong experiment, you might end up with 5- and 6-horse fields anyway.

And, if a takeout adjustment isn't made to deal with this lamentable occurrence...then the racing in Hong Kong will travel down a similar path as ours has gone. The quality and the competitiveness of the product will suffer, the public interest will wane...and other forms of state-sponsored gambling will rise up to feed the betting public's newly-found apathy.

It's all quite predictable...and easy to comprehend.

[highnote]

Originally Posted by castaway01

Your argument got crushed into a little ball by iamt, so no need to revisit it.

I disagree. I just showed that there is another side to the argument. It doesn't mean anyone won or lost. It just means there is more than one way to look at it.

But when you say things like "Racing is a monopoly in the United States" you sound clueless.

If you don't think racing is a monopoly in the U.S. then you are clueless. Try building a new racetrack across the street from Saratoga and see if there is any pushback from the NY government.

It's a monopoly in Hong Kong too---a government-run monopoly. You continually overlook the fact that the government controls all gambling there and takes all the money from it.

Show me where I ever said it was not a monopoly in HK. Of course it is.

That's not the case here. It's gives them room to run tracks WHERE TAKEOUT IS NO BETTER THAN THE UNITED STATES (which would be my only reason for wanting to bet Hong Kong, if I actually got a better return on my bets, which we don't) and still make a fortune.

This sentence is not clear, but what it sounds like you're saying is that takeout in HK is too high for you to make money and if it was lower you could make a fortune and then you would bet there.

Most racetracks here are struggling to hold on. There isn't room to expand, or build competing tracks. For years, the only reason to do so was to get a casino license. Perhaps that market is largely saturated now, or maybe we'll find more casino locations someday. At any rate, *most* racetracks don't make much money on horse racing. That's why there is a resistance to change, that's why there isn't a ton of money to experiment with, that's why there's a reluctance to suddenly change the drug rules. It's money. Until you make horse racing lucrative on its own you're not going to get people throwing money at it to run racetracks with handicap divisions. You'd have to tear racing down from the ground up, but without the government paying for everything like in Hong Kong.

So let me get this straight. You say most racetracks in the U.S. don't make much money on horseracing and that is why there is resistance to change. That is not a good way to run a business and is a recipe for bankruptcy.

If my business started making less money the first thing I would do is change the way I run my business, otherwise, I will be out of business. And that has been my argument all along -- find a better model and implement it, otherwise, many racetracks days will be numbered.

That said, I appreciate all the feedback. Your feedback is exactly what is needed. Any track executive who would entertain the idea of creating a handicap division at their track is going to be asked the same questions and receive the same criticism. It would not be prudent to ignore the criticism.

[highnote]

Originally Posted by jeebus1083

Is your name Walt Gekko? ��

No

[highnote]

Originally Posted by rastajenk

When owners and trainers opt out of participating in the Gulag of the Hong Kong experiment, you might end up with 5- and 6-horse fields anyway.

Nothing ventured, nothing gained.

[Nitro]

Originally Posted by iamt

.....As it stands HK isn't an appealing product just because of its integrity measures etc, it is appealing because the pools are huge and can support just about anyone entering into it. If Nebraskan racing implemented all the same measures as HK, it would be a bust because the wagering isn't there for any fresh bettors.

Highnote I’m not sure if you noticed this comment and what it implied, but it struck a cord with me.

In my estimation it seems that the author doesn’t quite understand why the betting pools are consistently so large. Does anyone really believe that those HK pools would be that large if they didn’t maintain the highest degree of integrity and transparency in the racing product they offer? It seems to me anyway that everything the HKJC does is geared to affect its patronage in a positive way. They clearly understand the significance of keeping everything fair and above board.

Could anyone imagine someone betting say a ¼ Million dollars knowing that there are possible deceitful or deceiving activities going on? The pools aren’t large because bettors find them inviting. They’re large because the bettors know that they’re getting a fair shake in all aspects of the game.
.
.

[highnote]

Originally Posted by Nitro

Highnote I’m not sure if you noticed this comment and what it implied, but it struck a cord with me.

In my estimation it seems that the author doesn’t quite understand why the betting pools are consistently so large. Does anyone really believe that those HK pools would be that large if they didn’t maintain the highest degree of integrity and transparency in the racing product they offer? It seems to me anyway that everything the HKJC does is geared to affect its patronage in a positive way. They clearly understand the significance of keeping everything fair and above board.

Could anyone imagine someone betting say a ¼ Million dollars knowing that there are possible deceitful or deceiving activities going on? The pools aren’t large because bettors find them inviting. They’re large because the bettors know that they’re getting a fair shake in all aspects of the game.
.
.

I agree with you. HK pools are large because of the high level of integrity there. It also doesn't hurt that they provide an incredible amount of data for free. Information drives betting.

Everyone agrees that U.S. racing is in decline and needs solutions to make it better, but very few are willing to lay out a plan to improve U.S. racing.

I'm not saying my plan is the greatest, but it's an attempt. But I've always been an entrepreneur and am comfortable taking risks. Andy Beyer wrote about the "deliciousness of uncertainty". I love that line.

[Nitro]

Originally Posted by thaskalos

And, if a takeout adjustment isn't made to deal with this lamentable occurrence...then the racing in Hong Kong will travel down a similar path as ours has gone. The quality and the competitiveness of the product will suffer, the public interest will wane...and other forms of state-sponsored gambling will rise up to feed the betting public's newly-found apathy.

It's all quite predictable...and easy to comprehend.

How do you come up with this sort of nonsense?! First of all while Hong Kong has a 17.5% take-out in the mutual pools and 25% across the exotics, only those with winning bets need to concern themselves with the take-out. Even then, those smart enough can usually rationalize the value of their potential wagers by simply using the odds of their selected entries as a barometer for making a successful play. Why? Simply because the odds displayed already account for the take-out removal.

Aside from all of that, the HK racing program is becoming more and more lucrative each year and going in the exact opposite direction of most Stateside horse racing programs (which by the way have attempted to lure the betting public by lowering the take-out in some cases). These sort of “band-aids “ are not going to solve the major underlying issues causing the deterioration of the Stateside game.

Actually it’s very easy to comprehend the obvious current lack of interest in many circles of the general public as related to the horse racing game here in the States. 40 or 50 years ago our hometown culture was very much like that in HK. However, there’s a explanation as to how that’s all changed. You simply have to examine what the Stateside horse racing jurisdictions have (and have not) done since then to jeopardize its very existence by making decisions that ignore the very foundation of this game: The bettor!

[highnote]

Originally Posted by Nitro

How do you come up with this sort of nonsense?! First of all while Hong Kong has a 17.5% take-out in the mutual pools and 25% across the exotics, only those with winning bets need to concern themselves with the take-out. Even then, those smart enough can usually rationalize the value of their potential wagers by simply using the odds of their selected entries as a barometer for making a successful play. Why? Simply because the odds displayed already account for the take-out removal.

Aside from all of that, the HK racing program is becoming more and more lucrative each year and going in the exact opposite direction of most Stateside horse racing programs (which by the way have attempted to lure the betting public by lowering the take-out in some cases). These sort of “band-aids “ are not going to solve the major underlying issues causing the deterioration of the Stateside game.

Actually it’s very easy to comprehend the obvious current lack of interest in many circles of the general public as related to the horse racing game here in the States. 40 or 50 years ago our hometown culture was very much like that in HK. However, there’s a explanation as to how that’s all changed. You simply have to examine what the Stateside horse racing jurisdictions have (and have not) done since then to jeopardize its very existence by making decisions that ignore the very foundation of this game: The bettor!

I thought he was being facetious. Although, I can never tell with thas. He has a great sense of humor.