Things no one tells you

[thaskalos]

Originally Posted by cj

I'm not a poker player, but a young neighbor of mine knew I bet horses and asked me about going pro in poker. He was full of bad beat stories. I told him if he thinks they are truly bad beats, gambling isn't for him.

There you go! That's what "mature gambling" is about. We know the dangers going in, we accept them...and then don't whine when we encounter them.

[AndyC]

Originally Posted by thaskalos

I used to think that too. And then I met more than a few quite successful poker players, who managed to handle the psychological aspect of poker quite nicely, even though the losing streaks were just as prevalent there too. I just can't understand why there are so many more professional poker players than professional horseplayers...and this leads me to believe that the biggest hurdle in horse-betting is the complexity of the game, and the "economics" that govern it.

Obviously there are players who can manage the stress of losing streaks and survive. I have known several people who have tried the professional gambler route only to succumb to the stress. Probably explains how some players who have jobs other than betting are better positioned to handle the financial stress of losing streaks.


I agree that the biggest hurdle in horse-betting is the complexity and economics.

[classhandicapper]

Originally Posted by thaskalos

We were talking about losing streaks...not bad beats.

Losing streaks occur in all gambling games and we are all equipped to handle them differently both financially and psychologically.

I don't think I've ever met a horseplayer than wasn't impacted by a really tough beat occasionally. People may brush them off at different rates, but everyone tilts/steams a little unless they are using all computer play. I'm still pissed off I didn't pull the trigger on a race over the weekend. It's not going to impact anything, but if it was for a 100k Pick 6 it would.

[classhandicapper]

Originally Posted by AndyC

Probably explains how some players who have jobs other than betting are better positioned to handle the financial stress of losing streaks.

I agree that the biggest hurdle in horse-betting is the complexity and economics.

I don't think there's any question about that.

If you are in the midst of a long losing streak but have a steady paycheck, I'm not even sure why you would be stressed unless you are gambling over your head wiping out needed savings or going into debt. If you are gambling responsibly you should have some kind of bankroll set aside or be doing it with your pocket money. That can always be replenished when you have a steady job and are living within your means.

If you need to win to pay bills and are in the middle of a losing streak watching your bankroll evaporate, that stress may cause health problems on top of the financial ones.

If by "economics" we are talking about the high "track take" that's obviously the biggest factor. Almost every other gambling game that can be beat has a lower take/rake. If in some alternate reality racing had a 5% take, there would be loads more professionals.

[Light]

Originally Posted by ReplayRandall

I have no bad beat stories to tell...there are no such things. Those who tell their supposed beat stories simply can't handle the game, end of story.

I didn't tell that story cause I can't handle it.

I told that story to illustrate from real experience, not theoretical bs, that watching replays is not necessarily a good thing.

[sharkey11]

i have known several pros and some of them would get steamed about racing misfortunes but what realy suprised me was how pissed they would get for either not getting the pool shot or they knew the other pros that killed there price

[Poindexter]

Originally Posted by Bustin Stones

Perhaps you had not considered that no activity can survive by serving its serious followers. It was the casual followers that filled the aprons back when it did not require subsidies to finance racing.
These casual followers have no problem buying lottery tickets where the takeout is 50%. Dealing with rebates and takeouts may solve your issues, but they won't save horse racing. A casual fan won't sit at a monitor to watch an event. They can do that at home. They come out to relax and watch a live race. But, they will no longer patiently wait 25 minutes to see the next race if it's a run of the mill, non event race. They'll decide in the first 10 minutes who they like and be ready to go. They come to be entertained. If we can solve that one, we can save horse racing.
I do not wish to minimize your takeout concerns, but defending those by claiming it can save racing seems self serving.

First off, people please stop with the lottery as serving any meaning in the discussion about takeout. The customer for the lottery is not the customer for the racing industry. Its a no skill brand of gambling where people play for a chance to win millions and once in a while over a billion dollars. Nothing in the racing industry can compare or compete. They can charge a 85% takeout and people will still play the lottery. Because when you have little hope of becoming successful spending a buck or 5 bucks for even 20 bucks for a chance to become a multi millionaire seems like a small price. Not exactly rational, but human emotions often aren't.

Regarding your comment that dealing with rebates and takeouts my solve my issues but it wont save racing. How do you know? When has racing ever been competitively priced? Not in my lifetime and I am almost 60. I guess you either did not read my response to RR above or failed to see the logic. If you fix the game everyone enjoys the game more and participates in it more. Not just me. I may have a legitimate chance of crossing over to the profit side and becoming a better customer for the racing industry than many others, but there are plenty of others that will exceed me. Even the group that will never beat this game will stay in it longer, some will stay long term because the enjoyment of the game is worth a little extra juice to them. It is just not worth losing 30 or 40% on the dollar as some these specific players will currently lose when they bet horses.

Re They come out to relax and watch a live race. But, they will no longer patiently wait 25 minutes to see the next race if it's a run of the mill, non event race. They'll decide in the first 10 minutes who they like and be ready to go. They come to be entertained. If we can solve that one, we can save horse racing.

Did somebody drop you off back in 1985.? People have phones and ipads and pcs and can play races from tracks all over the country. The attendance issue is something that will pick up long term if racing would come to their senses and fix the pricing issue. If nobody is betting the game the big horse race of the week, month or year really doesn't mean anything to most. If you convert people from being on the sidelines to actually participating in the game, they will gain a passion for the good horses and the good races and the sport. Suddenly a sports bettor who gets into racing starts to really get into the sport. Maybe he starts going to Belmont Park once or twice a week.

PA, years ago used to use the slogan adapt or die, when I would post on this subject. Guess what, who isn't adapting, and who is dying? The racing industry. People that think like you, which seems to be the entire racing industry, are the problem and the reason this sport will eventually die. Don't worry about me, I will be just fine. I will serve myself in the gambling arenas that choose to offer competitive pricing. Those who want to play ball get my business, those who offer little in terms of competitive pricing get very little of it. These are the facts of life. Racing can decide to become a player in the advantage gambling market or they can continue to be a relic.

One last subject. Racing doesn't have to be a hands on experience for people to bet it. Simple idea. Why can't every adw offer every player the ability to enter a fair odds line (which can adjust for late scratches) and let the computer do the rest. Much like Caw. I enter my line line and bankroll for race 3 at Santa Anita, at post the computer combs the win pool, combs the exacta pools, double pools (if I have a line in both races) makes my bets (based on my required parameters) at post time, while not even being involved. Not exactly rocket science. How many folks will go for it? Who knows. Train people how to make an odds and many definitely will. You can even program the software so the players can analyze their own data and see vital stats. It is a one time investment that pays dividends forever. Want to bring people to the track, offer bonuses on parlays and/or round robins. Bottom line is rather that fix pricing and use technology to its advantage and thinking a little outside of the box, the racing industry wants to be the leech that uses every other form of gambling to keep it afloat. For some reason you think this is fantastic. Enjoy the procession.

[porchy44]

Originally Posted by Scamper

I believe it takes more time and effort
to become a really good handicapper
then it does to get a PhD in college or
to become an expert in real estate or
the stock market.

You have to have the discipline of a Tibetan Monk, and I dont know any....

[Jeff P]

Believe it or not roughly 70% of state lottery revenue is generated by scratchers tickets and not mega-jackpot games.

It also turns out lottery players are price sensitive.

Back in 2010 then Governor Arnold Schwarzenegger signed AB142 into law - a bill that gave the California Lottery the ability to raise prize payout percentages on the games they were offering.

As a result, the California Lottery engineered a complete turnaround.

I wrote about this for the PlayersBoycott.org site back in September, 2014.


Recommendations for California Racing from PLAYERSBOYCOTT.org
http://www.playersboycott.org/ArticleSept012013.html

Borrow a Page from the CA Lottery:

CA Lottery Increases Total Revenue for Education through INCREASED PRIZE PAYOUTS
AB142, a bill authorizing the CA Lottery to LOWER the Takeout on Scratchers Games, was signed into law in 2010 by CA Governor Arnold Schwarzenegger.

Unlike horse racing (which took the opposite approach and raised racing takeout with SB1072) the CA Lottery has been able to leverage LOWER TAKEOUT to drive brand recognition and generate significant increases in both sales and total revenue for Education.

Here's a quote from Linh Nguyen, Acting Director, California Lottery:

Ray Paulick wrote about this about a few months later in January, 2014.

California Lottery Success a Lesson for State’s Racing Industry?
https://paulickreport.com/news/ray-s...cing-industry/

The California Lottery and California's horse racing industry both were experiencing economic declines in 2010. The lottery benefits public schools and state officials became concerned after 2009 when the revenue stream to education, while still over $1 billion per year, hit its lowest point since 2003.

Horse racing interests were concerned, too. On-track attendance and overall wagering, with the exception of Del Mar, were in steep decline. Competition with other forms of gambling in and out of state was growing. Breeding activity was falling and racehorse ownership was down. Leaders of horsemen's organizations and racetracks believed increased purse levels would stimulate horse ownership, leading to larger field sizes and a reversal of wagering declines.

The legislature took on both problems from different approaches.

Lottery officials felt not enough prize money was being returned to lottery players. California law capped the percentage returned to prizes at 50 percent, with a minimum 34 percent of revenue going to education.

A new law gave the lottery pricing flexibility, permitting officials to effectively reduce takeout. In 2011, according to a recent Los Angeles Times article, the portion going to prizes was increased to 55 percent. In 2012, that percentage was increased even further, to 59 percent.

There was only one rub to the law: education contributions were required to grow year-to-year. If they fell, the lottery was required to return to the previous formula capping prize money at 50 percent of revenue.

It worked. Helped in part by the introduction of new games, lottery revenue soared by 42 percent over the first two years of the new law. The contribution to education increased by 21 percent, even though the percentage of revenue going to public schools fell from 34 percent to 30 percent.

Horseracing went in a different direction. Instead of returning more to horseplayers, a new law passed in 2010 returned less by increasing the takeout by 2 percent on exactas and by 3 percent on trifectas and multi-race bets. All of the revenue from the takeout increases went toward purses.

Statewide handle has declined since the law passed and went into effect in 2011, dropping 10.5 percent from $3,441,290,099 in 2010 to $3,077,584,646 in 2012. In response to the wagering declines and an outcry from some vocal horseplayers, a few new bettor friendly wagers have been created, including a low takeout Pick 5 that has become very popular, and three low takeout daily doubles offered since the start of the Santa Anita Park meeting Dec. 26.

Point is all gambling games - both advantage games like horseracing, poker, blackjack, etc., and non-advantage games like slots, craps, roulette, lottery scratchers tickets, etc. - have a theoretical price point in terms of rake/vigorish/takeout, etc. that results in gross profits being maximized.

Set the rake too high for the game and betting volume craters (as well as gross profits.)

Set the rake too low for the game and betting volume grows but (but gross profits fall.)

Set the rake close to the each game's theoretical optimal price point - and you spark interest and betting volume for the game - while also maximizing gross profits.

One example of this for an advantage game is sports betting (4.5%.) Does anybody really think a casino would make MORE money on sports betting if it raised the rake on its NFL lines to match horse racing's 22% blended takeout?

Two example of this for non-advantage games:

• Scratchers tickets sold by a number of state lotteries (prize payout percentages in MA are within a point or two of horseracing trifecta and superfecta takeout in some states.)

• Slots and historical racing machines (prize payout percentages more than 90%.)

In a lot of states horseracing (a game with a 22% blended takeout) is only able to survive because it receives welfare money generated by games priced much closer to their (theoretical) optimal price point.

Suggesting the idea that optimal pricing for gambling games may not be so theoretical after all.




-jp

.

[Bustin Stones]

Originally Posted by Poindexter

First off, people please stop with the lottery as serving any meaning in the discussion about takeout. The customer for the lottery is not the customer for the racing industry. Its a no skill brand of gambling where people play for a chance to win millions and once in a while over a billion dollars. Nothing in the racing industry can compare or compete. They can charge a 85% takeout and people will still play the lottery. Because when you have little hope of becoming successful spending a buck or 5 bucks for even 20 bucks for a chance to become a multi millionaire seems like a small price. Not exactly rational, but human emotions often aren't.

Regarding your comment that dealing with rebates and takeouts my solve my issues but it wont save racing. How do you know? When has racing ever been competitively priced? Not in my lifetime and I am almost 60. I guess you either did not read my response to RR above or failed to see the logic. If you fix the game everyone enjoys the game more and participates in it more. Not just me. I may have a legitimate chance of crossing over to the profit side and becoming a better customer for the racing industry than many others, but there are plenty of others that will exceed me. Even the group that will never beat this game will stay in it longer, some will stay long term because the enjoyment of the game is worth a little extra juice to them. It is just not worth losing 30 or 40% on the dollar as some these specific players will currently lose when they bet horses.

Re They come out to relax and watch a live race. But, they will no longer patiently wait 25 minutes to see the next race if it's a run of the mill, non event race. They'll decide in the first 10 minutes who they like and be ready to go. They come to be entertained. If we can solve that one, we can save horse racing.

Did somebody drop you off back in 1985.? People have phones and ipads and pcs and can play races from tracks all over the country. The attendance issue is something that will pick up long term if racing would come to their senses and fix the pricing issue. If nobody is betting the game the big horse race of the week, month or year really doesn't mean anything to most. If you convert people from being on the sidelines to actually participating in the game, they will gain a passion for the good horses and the good races and the sport. Suddenly a sports bettor who gets into racing starts to really get into the sport. Maybe he starts going to Belmont Park once or twice a week.

PA, years ago used to use the slogan adapt or die, when I would post on this subject. Guess what, who isn't adapting, and who is dying? The racing industry. People that think like you, which seems to be the entire racing industry, are the problem and the reason this sport will eventually die. Don't worry about me, I will be just fine. I will serve myself in the gambling arenas that choose to offer competitive pricing. Those who want to play ball get my business, those who offer little in terms of competitive pricing get very little of it. These are the facts of life. Racing can decide to become a player in the advantage gambling market or they can continue to be a relic.

One last subject. Racing doesn't have to be a hands on experience for people to bet it. Simple idea. Why can't every adw offer every player the ability to enter a fair odds line (which can adjust for late scratches) and let the computer do the rest. Much like Caw. I enter my line line and bankroll for race 3 at Santa Anita, at post the computer combs the win pool, combs the exacta pools, double pools (if I have a line in both races) makes my bets (based on my required parameters) at post time, while not even being involved. Not exactly rocket science. How many folks will go for it? Who knows. Train people how to make an odds and many definitely will. You can even program the software so the players can analyze their own data and see vital stats. It is a one time investment that pays dividends forever. Want to bring people to the track, offer bonuses on parlays and/or round robins. Bottom line is rather that fix pricing and use technology to its advantage and thinking a little outside of the box, the racing industry wants to be the leech that uses every other form of gambling to keep it afloat. For some reason you think this is fantastic. Enjoy the procession.

I promise you, I am not taking any of this personally. While it may be a noble crusade to get racing to end rebates and lower takeout, it will not have any impact on changing the pool payoffs. You won't make an extra dime. The extra available monies will be scooped up by the high volume operators who will bet the horses down. That 2-1 winner will still pay 2-1. You will only be fattening their wallets with an ability to bet even more to get that horse down to 2-1. Luckily, the industry knows this already and won't waste time helping the high volume operators make even more money off them. You are going to have to beat them at this game with tools you already have. Help will not be forthcoming.

[thaskalos]

Originally Posted by Bustin Stones

I promise you, I am not taking any of this personally. While it may be a noble crusade to get racing to end rebates and lower takeout, it will not have any impact on changing the pool payoffs. You won't make an extra dime. The extra available monies will be scooped up by the high volume operators who will bet the horses down. That 2-1 winner will still pay 2-1. You will only be fattening their wallets with an ability to bet even more to get that horse down to 2-1. Luckily, the industry knows this already and won't waste time helping the high volume operators make even more money off them. You are going to have to beat them at this game with tools you already have. Help will not be forthcoming.

Do you actually think that the "high-volume players" will stick around if the rebates are eliminated?

[Bustin Stones]

Without rebates, the high volume guys won't bet as much. And the industry will collect less because of that. And if takeouts are lower the industry will also collect less. The industry is contracting fast enough without accelerating it. The answer to it is to make the product more appealing and stop worrying about the takeout or rebates. And to attract more betting from less analytical casual people who just want to hang and blow a few bucks.
Back when I was a teen, my folks would have dinner in the clubhouse at Northfield Park with some friends. That's the only time I ever heard of them gambling. They weren't worried about what they lost. It was just a way to relax. My folks never bet on games or bought lottery tickets. They were concerned when I spent so much time enjoying the track and pouring over programs. There are a ton of people like my folks who don't care about whether they won money. It's an outing.

[thaskalos]

Originally Posted by Bustin Stones

Without rebates, the high volume guys won't bet as much. And the industry will collect less because of that. And if takeouts are lower the industry will also collect less. The industry is contracting fast enough without accelerating it. The answer to it is to make the product more appealing and stop worrying about the takeout or rebates. And to attract more betting from less analytical casual people who just want to hang and blow a few bucks.
Back when I was a teen, my folks would have dinner in the clubhouse at Northfield Park with some friends. That's the only time I ever heard of them gambling. They weren't worried about what they lost. It was just a way to relax. My folks never bet on games or bought lottery tickets. They were concerned when I spent so much time enjoying the track and pouring over programs. There are a ton of people like my folks who don't care about whether they won money. It's an outing.

What happened to all those folks then...why aren't they at the track anymore? If there are indeed a lot of "less analytical people" out there, who "just want to hang and blow a few bucks"...what's keeping them away from the tracks now?

[Poindexter]

Originally Posted by Bustin Stones

I promise you, I am not taking any of this personally. While it may be a noble crusade to get racing to end rebates and lower takeout, it will not have any impact on changing the pool payoffs. You won't make an extra dime. The extra available monies will be scooped up by the high volume operators who will bet the horses down. That 2-1 winner will still pay 2-1. You will only be fattening their wallets with an ability to bet even more to get that horse down to 2-1. Luckily, the industry knows this already and won't waste time helping the high volume operators make even more money off them. You are going to have to beat them at this game with tools you already have. Help will not be forthcoming.

Let me provide the math for you in very simple terms. Status quo. 100k pool.

takeout wps 16%

Whales bet 25 k lose 3% or $750 and get 6% rebates for 1500 and a 3% profit.

Public bets 75 k loses $15,250 (the 16 k takeout less the 750 the whales pay)

net takeout on public $15,250/75 k or 20.3%.



Now what happens if the takeout is reduced to 8% and rebates are eliminated as I propose.

Whales now have to go to +3% to make the same income and thus for every 100k bet they will probably be down to about 15 k bet.

So whales bet 15 K at +3% and win $450.

The public bets 85k and has to cover $8450 ($8000 takeout +the 450 the whales win) So what does that do to the public takeout. 8450/85,000 or
it now becomes -9.94%.

This is basically a constant as the Whales betting will go up in proportion to the public betting. Obviously that -9.94% will vary on the players. Some novices will lose upwards of 20 % some sharps will cross into the profit zone and the rest will fall somewhere in between.

So what you fail to understand is that with my proposed plan the Whales win less, they have no incentive to bet horses down as much as they currently do because they are not rebated and have to now win, not lose less than the rebates and the game ends up being better for everyone else. That -9.94% takeout isn't that far removed from the slot player at -8%. It is close enough to break even that the sharp can climb the mountain and be profitable and the numbers make the games takeout very tolerable to everyone. Obviously the number are a little different in the exotic pools but I really do not know what kind of rebate schedule the whales are on in the exotic pools. I would imagine it is probably double digits or higher but I am not going to speculate.

When the public takeout become in the wps pool is reduced to 8% the sport becomes a lot more attractive to those that can actually grow the sport (advantage gamblers) and will keep those playing the game (from the sucker to the novice to the sharp) as continued customers. It is a really simple concept why you and the geniuses in the racing industry that you put on a pedestal think the status quo is a superior approach is quite perplexing.

[ScottJ]

Originally Posted by Poindexter

Let me provide the math for you in very simple terms. Status quo. 100k pool.

takeout wps 16%

Whales bet 25 k lose 3% or $750 and get 6% rebates for 1500 and a 3% profit.

Public bets 75 k loses $15,250 (the 16 k takeout less the 750 the whales pay)

net takeout on public $15,250/75 k or 20.3%.

Poindexter, agree with the conclusions, but the betting public needs to see the impact of rebates presented in a slightly different form.

If anyone (whale or public) bets into a 16% takeout WPS pool, the rake is fixed at the point of the bet - so, $0.84 per dollar wagered is "in action" for everyone in the pool. As part of the betting public, I am not charged "more" than 16%.

Now, if the tracks and pool operators decide to spend part of that 16% rake, WHICH IS THEIR MONEY FOR OPERATING THE POOL, on rebates to whale customers, there is no immediate difference to me in the betting public as I was already raked at 16% on my wagers.

Poindexter's cogent argument is that if the track's business model CAN AFFORD TO REBATE from that 16% rake, decreasing the rake for all makes better economic sense over the long haul than giving cash back to just a few players.

My disagreement with the presentation is when Poindexter captures that "public cost" by suggesting that player "net takeout" increases to 20%+.

Poindexter is correct to state that more of the effective net takeout after rebates is being paid by the betting public to fund the whale players.
However, the takeout is consistent at 16% and the operator's profitability in the net takeout after rebates is more heavily funded by the betting public.

Again, small technical point, but one worth acknowledging.