Takeout - How high is too high?

[takeout]

Where do you draw the line at takeout? How high would it have to be for you to give up playing a particular wager?

[superfecta]

When the amount won does not justify the risk,and that would depend on the individual bettor.Sorry to be so vague.

[Rick]

That's a difficult question to answer, because it seem that a lot of smaller tracks with a high takeout have less competition and your increased ROI would more than offset any differences. But, your bet size would be limited in smaller pools, so you may not be able to earn more anyway. If you really want to see some silly money, try betting greyhounds for a while. The competition is much weaker than in horse racing, but the pools are so small I don't see how they can stay in business.

[BillW]

I think the takeout problem takes care of itself. If you are having problems getting into the black at a given track, or not finding enough "value" plays, you move on. Both of these conditions are caused by the style of your game conspiring with the takeout. If you are successful at a track, the takeout is tolerable (although you would make more money if it was lower )

Bill

[takeout]

Is there a point at which you would quit betting on a certain track or wager on principle alone? For example, some players were so irate with the take at Hialeah that they just quit betting there altogether. I don't think at that point that it was even an issue of whether or not it was possible to still turn a profit.

[rrbauer]

Takeout finances the game at the expense of the players.

Unfortunately some venues can't compete (or, so they say) unless they have takeout jacked up to a level that raises eyebrows, antennas, and the like. Before Hialeah closed, I refused to play a dime at that track because the takeout was outrageous beyond any definition of being competitive. Brunetti laid a lot of gobbledygook on the industry media about how the takeout level at HIA was necessary to keep them in business.

Well, he got his high takeout; and, HIA is out of business!

As "mature", "experienced" horseplayers, we have an obligation to ourselves, and, the game, to thumb our noses at those venues which want more, in exchange for less. "Marked-up" schlock is still schlock!

IMHO.

[Rick]

Richard,

I agree with you about Hialeah, especially when other Florida tracks were able to make it with lower takeouts. Turf Paradise here has a high takeout but it's an easy track to handicap and pretty much the only game in town. However, I think even they would be better off by lowering the takeout to be more like other tracks, since they are competing with other tracks for out-of-state money.

[takeout]

Rick,

That's an interesting point about the competition more than offsetting the higher takeouts of some of the smaller tracks. Regarding the small pools, I once overheard some guys saying that they "shoulda key-horse-wheeled the super," not realizing that their one extra winning ticket would have made the bet a big loser for them. Question: How would you know if you were getting an overlay in an exotic such as the super until after the fact when you knew how many winning tickets there were?

[LoganDimes]

I recently read parts of a book on chance and skill in betting. Horse racing was deemed one of the worst forms of betting for the average player and it all came down to take-out rate. If racing had takes of 5% or less, it would be one of the best gambling options. The 20% take effectively kills the chance to make a consistent profit for all but the very best.

I also read a study by a U of Kentucky economist a few years ago on factors that affect increases or decreases in pari-mutual handle. After controlling for about a dozen possible factors, he found that there were 3 or 4 that consistently affected handle and take was either the 1st or 2nd factor. Meaning, the lower take went, the higher handle went. Of course this makes sense theoretically anyway, but the stupidity continues to proliferate at racetracks. (although I've heard that in some cases take-out rate is determined by state governments, but I don't know which tracks are highly restricted in this way).

[superfecta]

Originally posted by LoganDimes
I recently read parts of a book on chance and skill in betting. Horse racing was deemed one of the worst forms of betting for the average player and it all came down to take-out rate. If racing had takes of 5% or less, it would be one of the best gambling options. The 20% take effectively kills the chance to make a consistent profit for all but the very best.

I also read a study by a U of Kentucky economist a few years ago on factors that affect increases or decreases in pari-mutual handle. After controlling for about a dozen possible factors, he found that there were 3 or 4 that consistently affected handle and take was either the 1st or 2nd factor. Meaning, the lower take went, the higher handle went. Of course this makes sense theoretically anyway, but the stupidity continues to proliferate at racetracks. (although I've heard that in some cases take-out rate is determined by state governments, but I don't know which tracks are highly restricted in this way).

Horseracing was one of the worst?!Is the slots the best because of the 2% take?I have a real problem with someone who can say horseplaying is a bad gamble.worse than other gambling.Along with poker and blackjack,it gives the player an advantage over other games of chance.With a little skill,you have a better chance than at a dice table or roulette wheel.

[superfecta]

I didn't mean you personally,Logan,I meant the knucklehead who wrote that book you mentioned....

[rrbauer]

I think the operative term from the study is the "average player".

The "average player" might have a good time at the track and feel that the good time outweighs any financial considerations (although an occasional score might merit much "crowing"). But if you've been around this game very long you learn that being "average" won't cut it if profit is the goal! Being honest enough to recognize that; and, being tenacious enough to become better, are two of the attributes needed by a winning horseplayer.

On the flip side, the slot-machine player needs only to recognize that it's a negative-sum game and that the primary attribute needed is to quit when you're ahead!

[LoganDimes]

Superfecta, I should look up the reference on that book. But from what I recall the author's main point was that the 20% take from racing handle eliminates any advantage it has over casino games for the typical bettor because those games usually have a very small take (2-3%). A 15% is huge difference in almost any financial endeavor (think mutual funds for instance) but it's especially bad for racing because most of us who make money are large volume players. The average players stands no chance to make money at the track unless he quits when he's ahead (if he gets ahead) and never comes back.

Blackjack, for one, is a much better gambling option if the casino takes only 3%, even for skilled bettors, if you're just looking to make money. I find it hideously boring, so i stick to the ponies. Sports gambling is also much better than racing whenever the take is low (depends on the out).

Of course if racing's takeout was typically, say, 5% it would be the best betting option. If take was exactly equal to other games, it would be the best option by far. Especially for wiseguys, assuming pari-mutual pools were large enough (I love seeing those $500k win pools!).

[superfecta]

Originally posted by LoganDimes
Superfecta, I should look up the reference on that book. But from what I recall the author's main point was that the 20% take from racing handle eliminates any advantage it has over casino games for the typical bettor because those games usually have a very small take (2-3%). A 15% is huge difference in almost any financial endeavor (think mutual funds for instance) but it's especially bad for racing because most of us who make money are large volume players. The average players stands no chance to make money at the track unless he quits when he's ahead (if he gets ahead) and never comes back.

Blackjack, for one, is a much better gambling option if the casino takes only 3%, even for skilled bettors, if you're just looking to make money. I find it hideously boring, so i stick to the ponies. Sports gambling is also much better than racing whenever the take is low (depends on the out).

Of course if racing's takeout was typically, say, 5% it would be the best betting option. If take was exactly equal to other games, it would be the best option by far. Especially for wiseguys, assuming pari-mutual pools were large enough (I love seeing those $500k win pools!).

Thats what gets me ,when someone says the take of 15% makes it almost impossible to make money.But that is money never seen to the bettor.And that is not taking into account any handicapping skill,just the relationship between natural odds and track odds.Games such as blackjack and sports betting have a smaller edge for the house,but most payoffs are around even money,but its still possible to make a profit.Now how would we feel if track take was 5%,but the best we could do is double our money on any wager at the track?Nothing pays more than 2/1.Could we make a profit then?
Takeout would be the least of worries to me.......

[BillW]

There seems to be confusion over the difference between takeout and edge. They are not the same (although the cost can be).

Bill W.