Testing Overlays

[CincyHorseplayer]

Originally Posted by HalvOnHorseracing

A person I worked with in the 1980's told me he had never been to a racetrack. He lives in Riverside and since I was at Santa Anita last week I asked him if he wanted to go and he said he'd come on Friday.

One of the things I was told very early in my racing career was that it is good betting to turn 4/5 shots into 7/2 shots. It can be done by using the horse in a combination bet.

Anyway there was an odds on horse in the 5th race on Friday. I told my friend I was just going to bet an exacta with that horse and the 1 horse. He bet $20 on the same exacta. It paid $9.80 for $2. In other words, we turned a 4/5 shot into almost a 4-1 shot.

Not the payoff of the century, but it makes the point that you can get a decent return on your investment, even with short-priced favorites, if you focus a combination bet properly.

My friend collected $98 for his $20 investment. Not bad for your first bet.

Growing up at River Downs I learned this was often the only way to make money! Or pass practically an entire day of races. I still play plenty of exactas where a single combination might be $20 and another $20 spread out to get a 7-1 return. I've gone back to more of this than win betting simply because better returns take off some pressure of having to be the Einstein of handicappers.

[CincyHorseplayer]

Originally Posted by pandy

I get what you're saying, but that's a theory. Yes, in some instances the favorite may actually appear to be a good bet, but the problem is, no matter how good you are at handicapping, there isn't enough leverage there to show a long term profit on favorites. If the takeout was in single digits, maybe, but with the takeout 15% or higher, there just isn't enough room for error, and the rebates are too low on win bets to make up the difference.

Favorites are a false temptation. You hit a few overlaid favorites and you think you can bet them, but in the long run, they're a losing proposition. Of course, sometimes you have to use the favorite in exotics, but that's different. As win bets, they are fools gold. Theory is one thing, real life results is another.

Yep Pandy my last 3 years AB contenders less than 2-1.

2016-(-14%)

2017-(-7%)

2018(-11%)

The $6-8 range shows a modest profit. Then things jump up from there. Choosing the right odds range is simply a good foundation for nearly all bets IMO.

[pandy]

Originally Posted by CincyHorseplayer

Yep Pandy my last 3 years AB contenders less than 2-1.

2016-(-14%)

2017-(-7%)

2018(-11%)

The $6-8 range shows a modest profit. Then things jump up from there. Choosing the right odds range is simply a good foundation for nearly all bets IMO.

5-2 seems to be a good cut off for someone who wants to keep their win percentage respectable. Certainly less than 2-1 is brutal in terms of ROI. You know, when you first meet and get a chance to talk to a professional horseplayer, it's usually not the conversation that you expect. They tend to talk more about betting than handicapping. And one of the first things they talk about is the take out. The professional bettors aren't always obsessed with who's going to win, but they're experts when it comes to the math: the size of the pools, the takeout on each type of wager, carryovers, the wagers at each track that tend to generate overlays, the odds range that they can bet to show a profit. Sometimes, that's why they can win, even though they're not necessarily a bettor handicapper than other people who lose. They understand what they're up against and they have the mathematical know how to maximize their chances by making the right bets.

[GBL]

Originally Posted by pandy

I get what you're saying, but that's a theory. Yes, in some instances the favorite may actually appear to be a good bet, but the problem is, no matter how good you are at handicapping, there isn't enough leverage there to show a long term profit on favorites. If the takeout was in single digits, maybe, but with the takeout 15% or higher, there just isn't enough room for error, and the rebates are too low on win bets to make up the difference.

Favorites are a false temptation. You hit a few overlaid favorites and you think you can bet them, but in the long run, they're a losing proposition. Of course, sometimes you have to use the favorite in exotics, but that's different. As win bets, they are fools gold. Theory is one thing, real life results is another.

The answer was given based on the subject line "Testing Overlays". And overlays could include anyone including the favorites.

Now, that you've now put it in different light, it's impractical to think you can break the bank simply by playing win/place bets in longer terms. That's just not going to happen. Odds are stacked against you anyways. For good longer term ROI, exotics are more suitable to achieve the objectives. Secondly, if you play 20 races a day everyday, every system WILL fail. There just can't be any fool-proof system if you play too many races.

One of the keys to have an acceptable ROI and success rate in longer term is to limit the number of plays to minimum and only when the reward is acceptable against the risk. It's simply Risk vs. Reward strategy and limiting to your plays to when you feel the right opportunity arises. When you restrict your plays to only 2-3 races a day instead of 20 or 30, you're in a better position to play smarter and avoid unnecessary risks and losses.

Of course, that's also subject to one's own financial objectives and longer term goals.

[Dave Schwartz]

Now, that you've now put it in different light, it's impractical to think you can break the bank simply by playing win/place bets in longer terms. That's just not going to happen. Odds are stacked against you anyways. For good longer term ROI, exotics are more suitable to achieve the objectives. Secondly, if you play 20 races a day everyday, every system WILL fail. There just can't be any fool-proof system if you play too many races.

Is that an immutable law?

It clearly can be done by some people. It's being done by Whales every day.

[steveb]

Originally Posted by GBL

The answer was given based on the subject line "Testing Overlays". And overlays could include anyone including the favorites.

Now, that you've now put it in different light, it's impractical to think you can break the bank simply by playing win/place bets in longer terms. That's just not going to happen. Odds are stacked against you anyways. For good longer term ROI, exotics are more suitable to achieve the objectives. Secondly, if you play 20 races a day everyday, every system WILL fail. There just can't be any fool-proof system if you play too many races.

One of the keys to have an acceptable ROI and success rate in longer term is to limit the number of plays to minimum and only when the reward is acceptable against the risk. It's simply Risk vs. Reward strategy and limiting to your plays to when you feel the right opportunity arises. When you restrict your plays to only 2-3 races a day instead of 20 or 30, you're in a better position to play smarter and avoid unnecessary risks and losses.

Of course, that's also subject to one's own financial objectives and longer term goals.

i thought your first post was very good.
this one though i dont agree with.
i reckon churning is the way to go, and any pools are fine, if you can find bets above expectation.

i reckon it's much easier to win money from many small bets(i guess small is relative)even if your roi is far less, than it is from being selective
you can't spend roi.

i would be confident that ALL the big guys churn.
every race....every pool......where expectation is exceeded

and if you are just a hobby punter, it would not be much fun waiting.... waiting....waiting for your next play.
that's one boring hobby.

[GBL]

Originally Posted by steveb

i thought your first post was very good.
this one though i dont agree with.
i reckon churning is the way to go, and any pools are fine, if you can find bets above expectation.

i reckon it's much easier to win money from many small bets(i guess small is relative)even if your roi is far less, than it is from being selective
you can't spend roi.

i would be confident that ALL the big guys churn.
every race....every pool......where expectation is exceeded

and if you are just a hobby punter, it would not be much fun waiting.... waiting....waiting for your next play.
that's one boring hobby.

"....if you can find bets above expectation."

That's the bottom line, I suppose.

Whenever you come across a race which offers the proposition you're seeking, you make a go. How often these opportunities comes up I think depends on how you define it.

The reason that WP-only isn't the way to go for long term profitable ROI (subjective, again), especially when you're not willing to consider favorites' overlay as an overlay (as the originator of the thread implied), is not practical given the fact that some 60% of the races are won by top three favorites. practically killing the chances of any long term positive ROI. A 10/1 shot finishing second behind 6/5 favorite, generally speaking, will still probably pay around 2/1 or 5/2 for place. But then you have to come up with that 10/1 to begin with. Much tougher than people generally think.

The better way in such situations is to play longer price horses in "exacta-as-a-place" meaning rather than play place, play exacta with the favorite on top with longer priced as under. And, play straight win on the longer priced horse.

If betting favorite is a losing proposition (which actually is true) betting longshots in every race is also a losing proposition. There got to be a good mix and balance of both in one's betting strategy. I would think that hit ratio of around 40% with mixed odds could yield good ROI on longer term. Lots of subjectivity.

[GBL]

Originally Posted by GBL

"....if you can find bets above expectation."

That's the bottom line, I suppose.

Whenever you come across a race which offers the proposition you're seeking, you make a go. How often these opportunities comes up I think depends on how you define it.

The reason that WP-only isn't the way to go for long term profitable ROI (subjective, again), especially when you're not willing to consider favorites' overlay as an overlay (as the originator of the thread implied), is not practical given the fact that some 60% of the races are won by top three favorites. practically killing the chances of any long term positive ROI. A 10/1 shot finishing second behind 6/5 favorite, generally speaking, will still probably pay around 2/1 or 5/2 for place. But then you have to come up with that 10/1 to begin with. Much tougher than people generally think.

The better way in such situations is to play longer price horses in "exacta-as-a-place" meaning rather than play place, play exacta with the favorite on top with longer priced as under. And, play straight win on the longer priced horse.

If betting favorite is a losing proposition (which actually is true) betting longshots in every race is also a losing proposition. There got to be a good mix and balance of both in one's betting strategy. I would think that hit ratio of around 40% with mixed odds could yield good ROI on longer term. Lots of subjectivity.

P.S. to the above in light of overlays: Just like overlaid favorites, not every high priced-overlay is a good, bet-able overlay. The 15/1 in your assessment system going off as 25/1 doesn't necessarily makes it a good bet.

[GBL]

Originally Posted by GBL

"....if you can find bets above expectation."

That's the bottom line, I suppose.

Whenever you come across a race which offers the proposition you're seeking, you make a go. How often these opportunities comes up I think depends on how you define it.

The reason that WP-only isn't the way to go for long term profitable ROI (subjective, again), especially when you're not willing to consider favorites' overlay as an overlay (as the originator of the thread implied), is not practical given the fact that some 60% of the races are won by top three favorites. practically killing the chances of any long term positive ROI. A 10/1 shot finishing second behind 6/5 favorite, generally speaking, will still probably pay around 2/1 or 5/2 for place. But then you have to come up with that 10/1 to begin with. Much tougher than people generally think.

The better way in such situations is to play longer price horses in "exacta-as-a-place" meaning rather than play place, play exacta with the favorite on top with longer priced as under. And, play straight win on the longer priced horse.

If betting favorite is a losing proposition (which actually is true) betting longshots in every race is also a losing proposition. There got to be a good mix and balance of both in one's betting strategy. I would think that hit ratio of around 40% with mixed odds could yield good ROI on longer term. Lots of subjectivity.

Since every claim should be backed up by factual data, I thought it became necessary to publish some relevant statistics to highlight the difficulties and challenges one might face if he's hoping to make WP bets the basis of long term profitability especially when you're not willing to entertain favorites.

Here's some data to ponder from Dan Illman blog from the poster who maintains immaculate turf workbook for Gulfstream Park every year.

This was posted a day earlier (Monday 3/19/2018).

"Lately the Gulfstream Park turf courses are looking rather threadbare. Last week (W-T-F-S-Su) they ran 33 turf races. That is a lot of turf racing. Most were utterly forgettable. 18 races won by favorites (54%). One streak saw 6 straight chalks win. Only one winning horse went off more than 5.90-1 during the WHOLE WEEK. Field size was 8.4 last week. The course generally was not quick. Average winning time v. track record was about plus 4 seconds."

[pandy]

I agree with GBL that exotics are better for producing a positive ROI. But it's difficult to generate a positive exotic bet ROI with a key horse that has a minus ROI expectation. In other words, you still need to find that overlay. And, again, your chance of long-term success goes up if the key horse is not the favorite.

As for being ultra-selective and not making many bets, I don't agree with that. I think some players can make a lot of bets and still win. I read Mike Maloney's book and he seems to make a lot of wagers, and I know other players who are pros who make a lot of bets. One professional player who is currently active bets several pick 4's and pick 5's every day and has a lot of action, and wins.

There were three main points I wanted to stress from this thread, A). Favorites are generally bad bets in the long run. B). The horses that have the best long-term potential ROI are often not your top pick, or are not the horse that appears to have the best chance of winning. Your chances of winning actually go up if you only key the horses that have a lower win expectation. This is especially true in exactas and other vertical wagers where you can key a horse first or second. C). Testing, or actually betting and record keeping, is more reliable than "theory".

I remember many years ago reading that eating eggs can raise your cholesterol. But then I read a bodybuilding book by Vince Gironda, a natural professional bodybuilder who owned a famous gym in Hollywood. Gironda trained bodybuilders and movie stars who had to buff up quickly. He wrote a book called Unleashing The Wild Physique which was published in 1984. In that book, he said that the medical reports about eggs were false. He explained that for many years he had been having his pupils eat a dozen or more eggs a day as part of their training diet and their cholesterol didn't go up. Eventually, the medical profession started to test people and found the same thing, although eggs contain cholesterol, they don't increase your cholesterol. My point being, testing and real life results trump "theory".

[pandy]

By the way, thanks everyone for contributing to this thread, I appreciate it. GBLL mentioned that he didn't think you could win betting only longshots and that you need a mix. A mix is good because it helps cut down on run outs, but my testing has always shown that you can win, even on win bets, just by betting horses in the 6-1 and higher range. I truly believe that there are more overlays in the higher odds range because only the better handicappers are able to sniff out that live longshots.

One of the main reasons why most handicappers are just average, or below average, is that they are masters-of-the-obvious.

Years ago there was a website, I've mentioned it before, but unfortunately, I can't remember the name, but this was a service that gave out 20 to 20 computer generated longshot picks (on the morning line) every day. The picks were not just one angle, their system generated longshot picks based on different criteria that it showed could produce a positive ROI.

The cut off was either 6-1 or 8-1 on the ML, I can't remember exactly, but I think it may have been 8-1. Many of the horses went off much higher. I subscribed to the site out of curiosity. They offered a guarantee, which was, if they didn't show a profit that month, the next month was free.

Anyway, I followed this site for about a year and they showed a profit ten out of 12 months and showed an overall profit even though they gave out about 160 horses a week and almost every horse went off as a longshot. The win percentage was only around 12%! They also had stats showing their results over a three year period and they showed a profit all three years.

They took the site down and were thinking of selling their system as software but I never heard from them again.

[CincyHorseplayer]

Just wanted to add one last thing about decision making. When I first started to track contender selection ie 1st choice 2nd choice 3rd choice etc I noticed the drop off after the first 2. Top 2 would hit in the 25-30% range then 3rd choice would be 12-15% and 4th choice 8-10% etc. And I realized that many 3rd/4th choices and even 2nd choices weren't worth betting anyway so I started tracking them simply by main contenders and marginal contenders. Similar results over the last 1,000 races. Main contenders represent 21% of the entries and win 55% of the races. Marginal contenders represent 29% of the entries and win 31% of the races. It was what I had suspected all along. Marginal contenders do not win enough to develop a betting approach with them. And the mutuels are not any higher than the 9.07 on main contenders. And with the precipitous dropoff in hit rate evidenced by the 12-15% and 8-10% the average mutuel would have to be fairly astronomical to justify betting these horses. This reality has led to me to a conclusion I wholly believe=that value handicapping can lose itself quickly and become even a futile quest for value if not grounded.

That said with main contenders representing 21% of entries there are plenty of opportunities to bet value. I make practically no distinction between my top choices in a race. On handicapping principle I can split hairs if necessary but when win betting I simply bet the horse not taking action. If both aren't getting play I bet both. End of strategy. From 2001 to 2012 my average mutuel stayed with .50 of 9.40. Since then it has hovered within .50 of 12.23. All I did was restrict my win betting criteria to the above. Nearly 4 months into the new horse betting year my average mutuel is happily over $15, but waves of favorites the last few weeks are bringing that back into line.

None of that has anything to do with exotics. Lower mutuel horses always weave their way through payoffs and can still produce the desired return on bets. But I find the above to be a solid foundation for all plays to have a solid expectation. Or you don't bet. Period!

[CincyHorseplayer]

Originally Posted by pandy

I agree with GBL that exotics are better for producing a positive ROI. But it's difficult to generate a positive exotic bet ROI with a key horse that has a minus ROI expectation. In other words, you still need to find that overlay. And, again, your chance of long-term success goes up if the key horse is not the favorite.

As for being ultra-selective and not making many bets, I don't agree with that. I think some players can make a lot of bets and still win. I read Mike Maloney's book and he seems to make a lot of wagers, and I know other players who are pros who make a lot of bets. One professional player who is currently active bets several pick 4's and pick 5's every day and has a lot of action, and wins.

There were three main points I wanted to stress from this thread, A). Favorites are generally bad bets in the long run. B). The horses that have the best long-term potential ROI are often not your top pick, or are not the horse that appears to have the best chance of winning. Your chances of winning actually go up if you only key the horses that have a lower win expectation. This is especially true in exactas and other vertical wagers where you can key a horse first or second. C). Testing, or actually betting and record keeping, is more reliable than "theory".

I remember many years ago reading that eating eggs can raise your cholesterol. But then I read a bodybuilding book by Vince Gironda, a natural professional bodybuilder who owned a famous gym in Hollywood. Gironda trained bodybuilders and movie stars who had to buff up quickly. He wrote a book called Unleashing The Wild Physique which was published in 1984. In that book, he said that the medical reports about eggs were false. He explained that for many years he had been having his pupils eat a dozen or more eggs a day as part of their training diet and their cholesterol didn't go up. Eventually, the medical profession started to test people and found the same thing, although eggs contain cholesterol, they don't increase your cholesterol. My point being, testing and real life results trump "theory".

I agree with all of this down to the eggs Pandy!

[GBL]

Originally Posted by CincyHorseplayer

Just wanted to add one last thing about decision making. When I first started to track contender selection ie 1st choice 2nd choice 3rd choice etc I noticed the drop off after the first 2. Top 2 would hit in the 25-30% range then 3rd choice would be 12-15% and 4th choice 8-10% etc. And I realized that many 3rd/4th choices and even 2nd choices weren't worth betting anyway so I started tracking them simply by main contenders and marginal contenders. Similar results over the last 1,000 races. Main contenders represent 21% of the entries and win 55% of the races. Marginal contenders represent 29% of the entries and win 31% of the races. It was what I had suspected all along. Marginal contenders do not win enough to develop a betting approach with them. And the mutuels are not any higher than the 9.07 on main contenders. And with the precipitous dropoff in hit rate evidenced by the 12-15% and 8-10% the average mutuel would have to be fairly astronomical to justify betting these horses. This reality has led to me to a conclusion I wholly believe=that value handicapping can lose itself quickly and become even a futile quest for value if not grounded.

That said with main contenders representing 21% of entries there are plenty of opportunities to bet value. I make practically no distinction between my top choices in a race. On handicapping principle I can split hairs if necessary but when win betting I simply bet the horse not taking action. If both aren't getting play I bet both. End of strategy. From 2001 to 2012 my average mutuel stayed with .50 of 9.40. Since then it has hovered within .50 of 12.23. All I did was restrict my win betting criteria to the above. Nearly 4 months into the new horse betting year my average mutuel is happily over $15, but waves of favorites the last few weeks are bringing that back into line.

None of that has anything to do with exotics. Lower mutuel horses always weave their way through payoffs and can still produce the desired return on bets. But I find the above to be a solid foundation for all plays to have a solid expectation. Or you don't bet. Period!

pandy,
Thanks for positive and healthy exchange. Agree with many points you raised.

[AltonKelsey]

Shouldn't have to say it, but the number of bets you make has nothing to do with winning or losing IN ITSELF.

Some of you are confused. Many ?

A small sample is more likely to WIN even if the long term roi stinks.

A large sample will almost surely lose.


Thus, the confusion, thinking that many bets is somehow a negative.

For positive long term roi's its exactly what you want, as many plays as possible