The Gambler Who Cracked the Horse-Racing Code

[lamboguy]

Originally Posted by Tom

No one has proved to me that money is not pouring in after the gates open.
Or pouring out after.

you are right, there is a lot coming out of those pools after the races start.

[thaskalos]

Originally Posted by dilanesp

I mean most people who regularly gamble, whether or not they think of themselves as successful or skilled.

Most games are either unbeatable or not worth beating due to long variance curves or insufficient upside to justify time invested.

Those that are beatable are only beatable by a very small cadre of brilliant elite players with extensive mathematical knowledge, whose edge is often under constant erosion.

And one of the main attributes of that small cadre is they know better to assume their knowledge of the game that they beat will translate into an edge in a different game.

Finally, many people who believe they are in that cadre eventually go broke, sometimes multiple times.

In this regard...sports betting is no different than any other form of gambling. The vast majority of the gamblers in general approach the game of their choice with undue optimism, while fully knowing that the mathematics of the game dictate that only a tiny percentage of them can win long-term. You say that most games are "unbeatable"...but the same could be easily said of most RACES. A poll-question was posted here a few years ago...asking about the relative "long-term success" of our collective group here. If I remember correctly...33% stated that they were long-term winners...33% said that they were "about even"...and only 34% admitted that they were long-term losers. And this, in a game where hardly ANY of us have ever run into even a single horseplayer who has proven himself to be a long-term winner. Isn't it obvious that the horseplayers are as misguided as anybody else?

If your argument is that a gambler has a better chance of "success" in horse-betting than he has in betting sports...then I must strongly disagree with you, But, of course...you are entitled to your opinions.

[Denny]

Thaskalos,

Most gamblers are lying. It's human nature to lie if you aren't winning.

It's probably closer to - less than 5% winning.

Maybe 10% breaking even - or close enough.

85% losing.

Just guessing, but, based on playing and observing for over 40 years, and I'm being nice.

(I'm in the last group most years, winning years are exceptions.)

[Parkview_Pirate]

Originally Posted by dilanesp

He didn't make money in baseball.

I am convinced the average gambler significantly overestimates the actual number of profitable gambling opportunities.

There is very substantial evidence that in fact it is extremely difficult to "beat" the financial markets long term absent arbitrage or insider trading, and that people who do either don't advertise how they game the system or are just on the right side of the variance curve.

Hong Kong racing, as I think of it, is the perfect storm for this. I have gone to the races there. The pools are astronomical and there is tons of "dumb money" in the pools because Hong Kong is so wealthy and the culture is gambling-crazy.

I think this guy found just about the perfect outlet for his talent.

I'd agree with your general statement, and add that sometimes that "insider" or arbitrage edge ends up being the process that destroys the sport. Rebates have crushed the profitable or break even opportunity for many of the small players, and drove them from the game, even in Hong Kong per the rumors there. The impact on racing of rebates and lack of oversight shares some of the same characteristics as Amazon's canbilistic model, and is not sustainable.

[PaceAdvantage]

Originally Posted by Denny

Thaskalos,

Most gamblers are lying. It's human nature to lie if you aren't winning.

It's probably closer to - less than 5% winning.

Maybe 10% breaking even - or close enough.

85% losing.

Just guessing, but, based on playing and observing for over 40 years, and I'm being nice.

(I'm in the last group most years, winning years are exceptions.)

More than 85% are losing.

[steveb]

Originally Posted by Andy Asaro

He's profitable because of the enormous rebates he gets. My understanding that without the rebates he would have lost about 2% on average. I could be wrong but not mentioning the rebates in the article was malpractice IMO.

But he walked home with the money and that's all that matters when it's all said and done.

B U L L S H I T

[Maximillion]

Not pretending to know what these guys are doing...but even a 2% loss at the volume they reportedly put thru the windows would still be very strong with just a modest rebate...and its not like they are cherry picking their spots.

[Andy Asaro]

Originally Posted by steveb

B U L L S H I T

OK, he did it at retail takeout rates. Feel better?

[AltonKelsey]

Originally Posted by PaceAdvantage

More than 85% are losing.

I think he meant .85% were winning .

Seriously, depends on what sub group you're taking about. Very sharp players can and do win, good players might win, depends on how the wind blows, and average or worse players will probably lose.

[AltonKelsey]

Originally Posted by Maximillion

Not pretending to know what these guys are doing...but even a 2% loss at the volume they reportedly put thru the windows would still be very strong with just a modest rebate...and its not like they are cherry picking their spots.

Of course, and none of that is news. The ability to play for break even or small loss is a great edge, assuming you can actually do it reliably. You're then playing for the rebate, not to 'beat the odds'.

[acorn54]

i read cx wong's book called "precision handicapping", he was and maybe still is a member of the benter gang. he mentions in his book that benter made 40 times his original bank roll over the course of the 5 years he started out betting in hong kong. i think for all the brainpower and work he did (benter), he earned every penny.

[steveb]

Originally Posted by Andy Asaro

OK, he did it at retail takeout rates. Feel better?

i feel fine.
what i don't do, is state things i have no idea about as fact.

[Andy Asaro]

Originally Posted by steveb

i feel fine.
what i don't do, is state things i have no idea about as fact.

I don't know him personally but I do know people with knowledge of his situation which is similar to how most teams operate. From what I know they churn hundreds of millions of dollars and get the highest rebates available.

The industry gave them the opportunity to maximize their profits by leveraging rebates and designing systems to basically break even with the rebates being their profits. I don't blame anyone for taking advantage of a system that lets them. I happen to live in a state that has a retention cap where the rebates or rewards are basically nothing. And I do think that the allowing one group to get huge rebates while already having a bankroll edge and a SKILL edge is killing the game. If they have a skill edge then they should be able to compete at retail takeout rates (which should be lowered by 5% to 7% for everyone). Not gonna grow the game with what is going on now in the United States. And I am talking about wagering in the United States which is parimutuel wagering.

If I'm wrong which is possible but unlikely then give me some facts.

[GMB@BP]

In a pari-mutual game rebates effectively set different prices for players betting on the same event.

Whether that is fair or not is up to each individual.

Did I mention I dont bet much anymore?

[lansdale]

Originally Posted by JerryBoyle

I'm not sure if I'm happy or deeply concerned that he's still betting and in the US...

The last time I was in touch with Benter, in the early aughts, he was still iin HK but even then helping others to form teams in the U.S.. If you've looked at his paper or at the Bolton, Chapman paper on which his model was based, you know that none of this is rocket science -- the math is available to everyone, but not everyone has the ability to use it or the time/interest in building a handicapping model. Realize that if your model has been successful, you're already competing successfully against other people/teams using these methods.