Style of play

[classhandicapper]

I read these quotes today from Charlie Munger about investing, but they seem to fit betting on horses also.

"How do you learn to be a great investor? First of all, you have to understand your own nature. Each person has to play the game given his own marginal utility considerations and in a way that takes into account his own psychology. If losses are going to make you miserable and some losses are inevitable, you might be wise to utilize a very conservative pattern of investment and savings all your life. So you have to adapt your strategy to your own nature and your own talents. I don't think there's a one size fits all investment strategy."

"My father had this saying, he said, 'Investing is like painting, there are all different styles.' It's one thing to imitate someone's style when you are learning, just like a painter would go to a museum and copy great works, but at some point, they find what resonates with them."

"You have to be willing to look like an idiot in the short run to outperform in the long run. While copying what others already do helps achieve average results quickly, common approaches never outperform...What ends as better, starts as different."

[BarchCapper]

Great point!

I’ve been re-reading some old C&X Reports from the early 90’s authored by one of my favorite handicapping writers, Mark Cramer. There’s as much psychology of wagering/investing in those as there is nuts & bolts handicapping, and they’ve helped me remember (after my 10+ year absence from the game) what allowed me to be a mildly successful “hobbyist” player before.

Knowing who you are will help you with doing what you do well. I know that I am not now, and the likelihood is that I will never be, a “pick-N” type of player. As I returned to the game - so much of the emphasis (podcasts, literature) was on those type of bets that I allowed myself to be thrown off my previous way of approaching a racecard.

It’s definitely not a “one-size-fits-all” game, as evidenced by the wide variety of approaches we have here on PA alone!

[Tape Reader]

I love Mr. Monger’s insights. Here is one that I try to apply to option trading:

“Successful investing requires this crazy combination of gumption and patience, and then being ready to pounce when opportunity presents itself, because in this world opportunities just don’t last very long. Its waiting that helps you as an investor, and a lot of people just can’t stand to wait.”

[classhandicapper]

Originally Posted by Tape Reader

I love Mr. Monger’s insights. Here is one that I try to apply to option trading:

“Successful investing requires this crazy combination of gumption and patience, and then being ready to pounce when opportunity presents itself, because in this world opportunities just don’t last very long. Its waiting that helps you as an investor, and a lot of people just can’t stand to wait.”

That's a good one.

Years ago I had an arbitrage opportunity between the track and an offshore exchange where it was virtually impossible for me to not make money. The opportunity was potentially so lucrative, I temporarily convinced myself I must be missing something. So I was betting only modestly for a few weeks. As the profits started rolling in I realized I wasn't missing anything and should start really pounding it. The opportunity almost immediately disappeared as others started realizing what was going on and the pools corrected.

I had a similar experience making "place" bets on an offshore that had only a 5% take. Eventually, between me and another player that was doing the same things I was doing in the "show" pool they figured out their business model was broken and closed down.

These things rarely last. If you do find something like that (and I haven't for quite awhile) you can't sit around. You have to go for the jugular because they don't last.

[thaskalos]

I don't find that the stock market has much in common with the racetrack. For one thing...the long-term trend of the stock market is an upward one, assuming that the investor has the wherewithal to withstand the inevitable downturns. If only the horseplayer were as lucky. In this game, it takes a heck of a lot more than just "patience" for a player to have even a slight chance of profiting long-term.

I don't much believe in the concept of "pouncing on an opportunity" either. From what I've seen, steadiness is what gets the money in this game...assuming, of course, that the player has the requisite skill. I've given up looking for "lucrative opportunities" on which to 'pounce'...because I've discovered that my most optimistic wagers far underperform when compared to my "less enthusiastic" ones. If I feel that a wager just "can't miss"...it seems that a lot of other bettors notice that as well, and I end up with the short end of the stick, odds-wise. IMO...the secret is to bet with equal gusto on every playable race, regardless of our pre-race level of confidence. I just can't be persuaded that the horseplayer can tell which races his winners will be coming from.

[PaceAdvantage]

Originally Posted by thaskalos

I don't find that the stock market has much in common with the racetrack. For one thing...the long-term trend of the stock market is an upward one, assuming that the investor has the wherewithal to withstand the inevitable downturns. If only the horseplayer were as lucky. In this game, it takes a heck of a lot more than just "patience" for a player to have even a slight chance of profiting long-term.

I don't much believe in the concept of "pouncing on an opportunity" either. From what I've seen, steadiness is what gets the money in this game...assuming, of course, that the player has the requisite skill. I've given up looking for "lucrative opportunities" on which to 'pounce'...because I've discovered that my most optimistic wagers far underperform when compared to my "less enthusiastic" ones. If I feel that a wager just "can't miss"...it seems that a lot of other bettors notice that as well, and I end up with the short end of the stick, odds-wise. IMO...the secret is to bet with equal gusto on every playable race, regardless of our pre-race level of confidence. I just can't be persuaded that the horseplayer can tell which races his winners will be coming from.

Keep in mind those "ever upwards" market indexes benefit from survivability bias.

Given the previously mentioned scenarios for survivability bias we can extend this to the process of selecting and or deselecting stocks that are listed in the major indices, e.g. DOW 30, S&P 500 and the Russell 1000. Specifically, in the process of rebalancing the indices it is the tendency for failed companies to be excluded from indices because they 1. No longer exist, 2. Their market capitalization has fallen or 3. Their industry is in decline (which likely caused the first two reasons); this is considered Type 1, survivor bias. Inherent in this type of bias is the error you make in just counting the survivors.
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This suggests in essence an inherent upward bias in the indices. It's like changing out tired horses on the pony express for fresh legs. In December 2001, Enron was replaced in the S&P 500 with NVIDIA (NVDA which brought the S&P to include approximately 77 NASDAQ weighted stocks. NVIDIA a 21st century stock replacing a 20th Century also ran, shenanigans notwithstanding. As an offset to the previous example TYCO was also replaced, by Northeast Utilities (NU). So while there is a bias in the indices, it's not something to be running from. The propensity of the index though given the selection and de-selection process suggests that it is positively biased.

https://seekingalpha.com/article/207...ex-performance

[erikeepper]

Originally Posted by thaskalos

...the secret is to bet with equal gusto on every playable race, regardless of our pre-race level of confidence.

This is for win-bets, not exotics? You "can't" bet exacta with flat-bets, right?

[classhandicapper]

Originally Posted by thaskalos

I don't find that the stock market has much in common with the racetrack. For one thing...the long-term trend of the stock market is an upward one, assuming that the investor has the wherewithal to withstand the inevitable downturns. If only the horseplayer were as lucky. In this game, it takes a heck of a lot more than just "patience" for a player to have even a slight chance of profiting long-term.

I don't much believe in the concept of "pouncing on an opportunity" either. From what I've seen, steadiness is what gets the money in this game...assuming, of course, that the player has the requisite skill. I've given up looking for "lucrative opportunities" on which to 'pounce'...because I've discovered that my most optimistic wagers far underperform when compared to my "less enthusiastic" ones. If I feel that a wager just "can't miss"...it seems that a lot of other bettors notice that as well, and I end up with the short end of the stick, odds-wise. IMO...the secret is to bet with equal gusto on every playable race, regardless of our pre-race level of confidence. I just can't be persuaded that the horseplayer can tell which races his winners will be coming from.

I would say that implied in all this that you have to have the ability to recognize when you actually have a lucrative opportunity to pounce on (like in my examples) and that such opportunities don't usually come from looking at the same handicapping information in the same way as a lot of smart (and sometimes brilliant) people. It isn't easy to outsmart a bunch of very smart people using the same figures and concepts that you use when the take is so high.

In my experience, opportunities are rare and getting rarer because so much good information is easily available now compared to decades ago.

Finally, horse players these days seem to have some twisted tendency to want to brag about what's working for them and reveal every trainer pattern, bias, trip, bad figure, stat, or other potentially valuable insight they have on social media as if recognition for their talents is more important that actually winning in silence.

[mountainman]

I'm a grinder. Standard win-bet about 50 bux, but will often put down a hundred if I like the value. Infrequently, exactas and daily doubles pepper my play. For me, the key to success is patience, discipline, and NEVER chasing to recoup losses.

Unlike lots of others who frequent mnr's simulcast theater, I take no joy or comfort in sitting there for hours. I am a laconic gambler who barely changes expression when my fortunes shift even dramatically, and i never root. My only concession to internal churning and emotion is the HORRIBLY rude practice of flashing winning tickets to my friends..after the fact. But I encourage them to do the same..that is, feel free to brag to me about fresh scores and expect my rapt attention.

Another critical aspect of profitable play is having the smarts to know when the attractive odds on your prospective bet are an illusion bound to be corrected late. And as with many endeavors, I find that the true opponent is myself. It's just too easy when sitting there all afternoon to convince myself, out of boredom, that my opinion on a race I'm actually lukewarm about is instead strong or unique.

Just one disclaimer. When I bet Mahoning, I do counsel much bolder, gimmick-minded players in exchange for a cut.

[AltonKelsey]

Originally Posted by PaceAdvantage

Keep in mind those "ever upwards" market indexes benefit from survivability bias.

https://seekingalpha.com/article/207...ex-performance

That article is FOS for reasons obvious. Read the comments

[thaskalos]

Originally Posted by classhandicapper

I would say that implied in all this that you have to have the ability to recognize when you actually have a lucrative opportunity to pounce on (like in my examples) and that such opportunities don't usually come from looking at the same handicapping information in the same way as a lot of smart (and sometimes brilliant) people. It isn't easy to outsmart a bunch of very smart people using the same figures and concepts that you use when the take is so high.

In my experience, opportunities are rare and getting rarer because so much good information is easily available now compared to decades ago.

Finally, horse players these days seem to have some twisted tendency to want to brag about what's working for them and reveal every trainer pattern, bias, trip, bad figure, stat, or other potentially valuable insight they have on social media as if recognition for their talents is more important that actually winning in silence.

I have a slightly different opinion. I think horseplayers these days like to be just vague enough in their social media opinions to give the IMPRESSION that they possess some sort of "esoteric" handicapping knowledge"...while they, in fact, reveal no real handicapping insight at all. I can't say that I've encountered any information on social media the unveiling of which I would consider "detrimental" to the financial future of the person who revealed it...and this includes the handicapping opinions that I myself have shared on social media.

When I spoke of "lucrative opportunities", I wasn't talking about the rare "arbitrage" situations which pop up once in a blue moon. I was talking about mining the real handicapping situations that we encounter on a daily basis, looking for an opportunity to "go for the jugular", as you previously phrased it. I have abandoned this way of thinking long ago. In fact...I can't picture even a single handicapping situation now where I would be enticed to "go for the jugular", in an "aggressive" way. I place my bets in a cool and collected manner, while always betting within my bankroll...with the full knowledge that any individual wager that I make is likely to lose, since it does so about 70%-75% of the time. It's hard to "go for the jugular" when you win roughly one bet out of four.

[Robert Fischer]

One of my favorite sages.


Especially enjoy his wisdom on seeing things in terms of the major models that drive a system, and the importance of a fluency in the interrelatedness of various models in your system, and with the additive vs. exponential effects that occur when different models react.

[mountainman]

Originally Posted by Robert Fischer

One of my favorite sages.


Especially enjoy his wisdom on seeing things in terms of the major models that drive a system, and the importance of a fluency in the interrelatedness of various models in your system, and with the additive vs. exponential effects that occur when different models react.

Who let me in here??

[Robert Fischer]

Originally Posted by mountainman

And as with many endeavors, I find that the true opponent is myself. It's just too easy when sitting there all afternoon to convince myself, out of boredom, that my opinion on a race I'm actually lukewarm about is instead strong or unique.

same here.


I throw a small bankroll aside for day-to-day opinions.
Following along, and I disagree with something about the odds on a horse, and I make a small bet to that opinion.
Sometimes get lucky, and sometimes this bankroll goes haywire, and it's time to take a break.

The other 75% or whatever is for a great opinion. Maybe happens once a week, and I bet with decent coverage.

[classhandicapper]

Originally Posted by thaskalos

I have a slightly different opinion. I think horseplayers these days like to be just vague enough in their social media opinions to give the IMPRESSION that they possess some sort of "esoteric" handicapping knowledge"...while they, in fact, reveal no real handicapping insight at all. I can't say that I've encountered any information on social media the unveiling of which I would consider "detrimental" to the financial future of the person who revealed it...and this includes the handicapping opinions that I myself have shared on social media.

I think every time a respected competent handicapper is on TV, Twitter, Facebook, PaceAdvantage, or at DRF/Timeform etc... talking about how the rail was dead on a certain day, how after the first 5 races today it looks like speed is good, that horse "x" was 4 wide and 5 wide on both turns last out, that trainer "y" has an especially high/low ROI record in today's situation etc... he is giving away information that you formerly had to spend hours of personal time to come up with.

The old tout sheets weren't nearly as comprehensive or revealing.

I think every time people here debate speed and pace figures, class, trips, race flow, or supply data, etc.. they are giving away thoughts and insights that used to take years of internal debate and trial and error to resolve for yourself.

Back in the late 70s I came up with a trainer pattern that lead to some of the biggest scores I've ever made. It came up infrequently enough that it was several years before people finally caught on, the prices plunged, and he ultimately retired. I was getting more than 20-1 on a few horses each year that probably should have been 2-1 or 3-1. I came up with it by manually looking at every horse the trainer sent out for several years in back DRFs forms one at a time for weeks.

Other people knew too. I recall discussing it with Andy Serling here maybe 5-10 years ago. He made some scores also. But there was no social media back then. At most you told a couple of close friends. If someone were to find something like that now, it would be less than a week before it was blasted all over Twitter.

And of course since the tools are so much better now, instead of someone crazy enough to do weeks of boring work that was most likely going to lead to nothing, I could do it in a couple of hours with Formulator.