Quote:
Originally Posted by cj
Yes, I get it. You have three betting options with a 15+% takeout. That is terrible for horseplayers. It is slightly better than the same takeout on a coin flip, but here you won't even know the odds you are getting until after the bell.
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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.)