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FIXED ODDS BETTING

Chapter 1 - The concept of VALUE.

This 5-letter word needs to be imprinted on your brain if you are to become a successful punter. The average punter is trying to pick winners. That’s the plan. However, that’s frankly a ridiculous strategy which completely misses the point and ensures that the bookie makes a good living. Picking the jockey with a red cap will find winners, as will backing number 6 or the grey horse. Nonsense, picking winners is easy and therefore we will consign that theory to the scrap heap!

Let us return to the concept of value. If TESCO’s were to sell DVD players for £1 – you would buy one. It’s too good value not too. If they sold them at £2,000, you would laugh and walk away. Same DVD player but the price it is offered is either good value or poor value and we would all find it easy to make that distinction in that rather far-fetched example.

Chapter 2 - TRAINER FORM

Look for the X in the postdata section of the card (R POST) and check out any trainers with an X in the TODAY'S TRAINERS page. You have to learn to take a view as the X may not be valid if the stable is small or has few runners. However, for more prominent stables this can prove invaluable. Milton Bradley had gone 137 runners without a winner when I last checked earlier in the week. This is a stable with a modest strike rate of around 6/7 % but with a lot of runners monthly. If a trainer has had this many consecutive losers, cross the horse off. Racing Post journalists are particularly poor at taking this into account. Michael Blanshard went nearly the whole season before having a winner and Nerys Dutfield has had a blank season.

Some trainers commonly fall into the Cold Trainers category. N Twiston-Davies is currently in blinding form and tends to be at either end of the scale. His horses tend to run better fresh and later in the season he will be on the cold list for sure. Equally, at some point Milton Bradley will hit form and then he will have a lot of very well handicapped horses in his stable. Wait though until he has at least 2 winners. After 30 losers I made the point to a friend that he was out of form. My friend felt that was not particularly important as he was due a winner then etc etc.. I hope he hasn't backed the next 106 losers!

A glance at today's Racing Post shows top Northern Trainer Tim Easterby has had 74 consecutive losers. The stable is out of form. Eamon Tyrell has gone 202 days and 126 runners since a win in Ireland. Cross their runners off. It is amazing to me that very cold stables still have short priced runners and favs where the betting public is either unaware or adopting that suicidal phrase 'well he must be due a winner then!'

Some trainers such as Martin Pipe, Paul Nicholls and Michael Stoute rarely go through lean spells of any length. You have to learn to read the stats in context and take a view, but this is the starting point for me on any race.

Trainers comments are also extremely useful – don’t become a conspiracy theorist as most trainers give a frank and honest opinion of their horses chance. One or two trainers are famously optimistic or pessimistic which you will pick up with experience but on the whole there is great value in their comments.  

Other recurring nuggets are details of injuries, breathing operations, size of the horse, preferences one way round, long term targets, what is expected of the horse, trainers opinion on the h'cap mark etc etc. I personally believe no one knows the horse like the trainer and anyone new to this game should give trainer comments a high priority. At this stage of the season, the Stable Tour comments are more valuable when many horses are still making their seasonal debuts. As the season wears on, then perhaps the value lessens.

Similarly, the trainer comments in the Racing Post (and online now) on the day, especially on days where there is terrestrial TV meetings are invaluable. So many trainers say ' I don't think the ground will suit', 'the distance may be too far', 'I expect he will come on for the run', 'he looks harshly handicapped' etc. These comments are an invaluable aid when analyzing a race.

Just a further note on breathing operations mentioned above. A horses speed is limited by the amount of air it can get into its lungs. This is an important concept. Horses are able to swallow their tongue and therefore choke. This, obviously, will prevent the horse winning. A tongue tie prevents this from happening.  Some horses have other problems with their soft pallets etc which cause difficulties in getting enough air into the lungs. I am going to stop now because I am way out of my depth as I am not a vet but the point being - when a horse has had an operation to improve it's breathing, then it will often run much better. Paul Nicholls is not slow to have his horses operated on. At the moment, there is no requirement to declare such operations have taken place but if you come across such information, it may be worth taking note. 


Chapter 3 - TYPE OF RACE

Let's briefly look at some race types;

AMATEUR RACES - It is hard enough in this game without adding the amateur jockey into the mix. Abilities and experience vary wildly and even a good amateur usually has only a fraction of the experience of a good professional. These races are known for being run flat out as usually at least one amateur is unable to hold their horse. Of course, if you are sure that the best horse has the best amateur then it may be worth a bet, but in general avoid these races like the plague.

NHF RACES (BUMPERS) - Another category to avoid unless you know something not in the public domain. These races are used as a training ground and often are run at a slow pace. Certain trainers do well in bumpers and it can be worth watching these stables. Nicky Henderson is a good example and others include Alan King, Henrietta Knight, Paul Nicholls of course and Martin Pipe. However, this is not news, as their runners tend to be short enough. If you must bet in bumpers, then watch the market for positive vibes and pay attention to the Training Centre tipsters in the Racing Post.

2-Y-O MAIDENS - Unraced horses in this kind of race are usually best avoided unless, again, you know something others don't. Unless this is so, then when faced with a field of unraced 2-y-o's, then move swiftly on. If you must bet, then again, the Training Centre tipsters are worth a glance. Horses in these races that have experience have in the past often represented some value even if they finished down the field. It seems to me though, that in the past couple of seasons this advantage has been a little less pronounced and the market has corrected any advantage.

NOVICE HURDLES - I have no strong opinions on this type of race. They can present opportunity and danger. These days, many novices have had a flat racing career prior to hurdling and horses often improve for the switch, and often they don't. Again, experience is valuable and I tend to avoid hurdlers making their debut over obstacles.

NOVICE CHASES - A quick way to the poor house is to back short price novice chasers! Some trainers have a better record than others and trainers such as Robert Alner, Henrietta Knight and Nicky Richards tend to use hurdles only as preparation prior to their horses going chasing. Look for lightly raced horses that are built to go chasing and have not had a long career over hurdles and on the flat. Learn to deduce when a horse is going chasing by default because of a rising hurdle mark, or in an attempt to re-kindle the horse’s enthusiasm. As a general rule, chasing debutantes present a bigger risk than those with some experience. Avoid where possible odds on chances and look for a bit of value. Lady Luck takes a slightly bigger interest in this type of race than others.

HANDICAPS - Both flat and jumps, these are the medium for the form student to make financial gain. Handicaps move towards a more settled environment and the more races the runners have had between them, the easier it becomes. Learning to assess the lightly raced improvers against those dropping down the handicap is the key. In theory, every horse should finish level(!) and so things like the draw, stable form, trends, stats etc etc all work in your favour. If horses A & B are exposed animals and are handicapped to finish level, then if stable A is in blinding form and stable B is on a dreadful losing run, I would expect horse A to triumph. This is a simplistic example but the principle is there. With exposed handicappers, you are eliminating a lot of the unknowns seen in other types of races; yet the proportion of big priced winners is much higher. Successful tipsters love the big handicaps, which may appear daunting at first glance but are much more likely to provide a long term return for the mathematical gambler. Handicaps will be covered in more detail later on.

Chapter 4 - ALL WEATHER RACING

All weather racing is not everybody’s cup of tea but it is without doubt a huge part of British Horseracing. It is fair to say that the overall quality of the racing and the horses that run on the AW tends towards the bottom end of the class scale. However, every race has a winner and a wet Tuesday at Southwell offers as good an opportunity as any to find value.

I tend to concentrate on handicaps on the AW as I believe this is where the value lurks for the analytical mind. The ideal bet often comes from working through the following criteria

1) Does the horse want to win? If the horse is ungenuine, moody or repeatedly hangs, then avoid. I think on the AW horses who hang often do so consistently. Cross these off.

2) Is the trainer out of form? A big factor to me as discussed earlier. Small stables often have long barren spells but many middle - leading stables go through terrible spells. Milton Bradley, Nerys Dutfield, Michael Blanshard on the flat this year. Do not assume that they must be due a winner. Cross off horses where the trainer is clearly struggling.

3) Is the draw bad?.  The draw, especially over sprint trips on the AW tracks can make a significant difference.

4) Has the horse won or run well several times in a higher grade?

5) Has the horse won off today's mark? If the horse is young and improving, then this is of little relevance but for the more exposed animal it helps when selecting a good bet.

6) Is the horse in form or running into form? A horse dropping down the handicap but also improving on previous efforts fits the bill. Horses running badly should be avoided. Learn to distinguish between badly and moderately.

7) The jockey - Arguably more important on the AW than turf. Many claimers seem to be cutting their teeth on the AW tracks and generally, due to the tight nature of the bends more than anything, good jockeyship is important. A horse suddenly having an experienced pro up is worth a second look. Some jockeys ride the AW tracks better than others.

8) Horses running style. I liken the AW to greyhound racing. If you have 2 animals that run a circuit in 1 minute, one that leads and one that is held up, the one that leads will win more races. Horses that are held up are often best avoided as hard luck stories are more plentiful on the AW.

A horse that meets the 8 criteria above is almost certainly worth a very close look. Try to avoid red hot favs though. Something that the world and his dog are tipping is probably short enough. If the focus is elsewhere and you have a 5/1 - 20/1 shot, then in you go!  

<MORE TO FOLLOW>

Chapter 5 - STAKING PLANS

The subject of staking plans is well documented and there are some interesting and ridiculous theories a plenty. I have researched staking plans and gone over all my old bets to see if any particular staking plan makes the difference between profit & loss. The conclusion that I drew from this is that a good staking plan will not compensate for poor betting performance.  You need to back the right horses at the right price and no staking plan will effectively turn around a losing strategy.

However, to have a staking plan is ultra important. You must have discipline in betting and the staking plan anchors the natural urge to do foolish things with your stake. It seems to me that when the average punter wins some money - he increases his stake in light of his brilliant skill and judgement. The losing punter often increases his stake to chase his losses. This is disastrous! And don't think I haven't been there plenty of times in my formative years!

So, how best to define a staking plan? Well, my first rule is

1) The stake should be adjusted according to the price of the horse. Basically, more money should be put on an even money favorite than a 33/1 outsider. 

2) The stake should be determined by the size of the betting bank. Ideally, this should be a sum of money, set aside for the purpose of gambling and then written off. If it all goes, that's that. 

The staking plan below ensures that the bank should last a long time even with poor performance and will increase at a rate dependent on the success of the investments.

Let us assume a starting bank of £1,000. Each bet should be to win / lose 5% of the bank.

So, if our first bet is a 5/1 shot, then £1,000 x 5% = £50 / 5/1 = £10

£10 should be the stake. If the bet is a lay, then the same rules apply. We risk £50 by accepting a £10 bet at 5/1.

Ideally, this stake should be calculated as each bet is settled. However, in practice, this is not feasible as several bets may be placed on the day's racing in the morning and as the action unfolds the stakes would have altered. The best way therefore is to calculate the 5% after each day. I personally calculate mine only at the end of each month but I would recommend daily for the newcomer.

If successful, the bank will increase with an exponential type curve. eg, assuming a profit of 10% of the bank each month;

£1000 x 110% = £1100

£1100 x 110% = £1210

£1210 x 110% = £1331

Therefore each month the monetary increase is larger than the previous month. Desirable of course! In reality there are losing days, weeks and months but if you are successful then this staking plan is, in my humble opinion, the best way of going about things. Do not be tempted to think that if you really feel positive, it is worth having a bigger bet. Rather, ask if lesser bets should be placed at all. The staking plan is an essential 'mentor' which acts as a barrier between 'Gambling' and 'Investing'.

Although I do advise a points stake when supplying tips, I recommend that the above system is used and implemented by the client to a level of investment that suits them. 

I also find it a necessary compromise to determine the stake before attempting to place my bet. I therefore use the Racing Post forecast price to determine my stake. Of course, this creates an inaccuracy but it becomes necessary for practical reasons. 

Just one other staking plan to mention (and I seriously advise anyone against trying this!) is a system that on paper is foolproof and requires no skill in tipping.

Suppose we were playing roulette (with no house edge) and therefore the chance of RED coming up is even money. Suppose we place a £1 bet on red. If we plan to win £1 for each red that comes up, then if we lose we need to win the accumulated losses since a win plus the £1 profit.

A simple excel calculation shows that we can expect a losing run of 16. Therefore, our 17th bet would be £65,536! Just to win £1. It would be better off in the Post Office. I only mention it here as I have succumbed to this apparent no-risk strategy in the past and won lots of '£1's' before hitting the inevitable losing run and wiping out all the £1s and many more besides! Chasing your losses is a fatal action and must be avoided.

  Chapter 6 - TYPES OF BET

This won't take long. If you want to know the ins and outs of a SUPER HEINZ or the odds on a 12 horse each way accumulator coming up, then all that is available elsewhere on the internet. That kind of bet has it's place - it's a fun bet. Nothing more. You cannot expect to make a steady income from anything other than WIN, E/W, LAY and PLACE bets. Walk into any betting shop and they are plugging Lucky 63's, forecast accumulators, Heavily doctored forecast dividends etc. Why? Because all those type of bets are a cash cow for the bookie. You never see 'Why not try a Win Bet' with the image of a blank betting slip.

WIN Bets  -  The win single is the staple diet of the serious gambler. If you don't win, then you've lost. In fixed odds betting, the win single is the best medium for consistent long term profits, and that should be just as exciting as watching your accumulator go down after one race!

EACH WAY Bets  -  Each way betting is actually a bad idea mathematically. In a 7 horse race, if a bookie is paying 1/4 the odds 1, 2 then if each horse was 6/1 then the bookie would take 14 points and pay out 12 points assuming a theoretical balanced book, a 29% bigger profit margin than the win market which would pay out all 14 points. Again, 1/5 odds in a 15 runner novice hurdle assuming each horse is 14/1 pays out 26.4 pts for each 28 points taken. In a handicap of 16 runners or more, there are 4 places and at 1/4 the odds the bookies advantage is vastly reduced and if the book is only slightly over-round and there are circumstances when it can actually favour the punter. In a contradiction to all the above, suppose three 8 runner races whereby the fav was longs odds on, then an e/w treble on the second fav may pay out more than the true odds suggest it should. However, in general, e/w bets lose a bigger proportion of the stakes placed than win bets.

Having said all that, I reasonably often advise an e/w bet on my selections - especially in handicaps. The reason for this is that as I am appyling the concept of value to my selections, the mathematical disadvantage is eroded by the perceived value in the odds on offer. Coupled with the fact that I expect my selection to run above its market position, regardless of where it finishes, my long term results show that backing my selections each way has proved an asset over time.

In an 8 runner race, terms of 1/5 the odds a place would typically be offered. Let us assume that each horse an equal chance and there is no profit margin for the bookmaker (if only!). In this circumstance, each horse would be a 7/1 chance. If we had £20 win on each, then we would stake £160 and return £160 whichever horse won. No profit or loss.

If we instead had £10 each way on all 8 selections; then we would again risk £160 but our returns are as follows;

On the 2 placed horses, we return £10 at 7/5 (7/1 x 1/5 the odds) = £24.each.

The winning horse returns £10 x 7/1 =  £80 + £24 for the place part.

Our total returns are now £24+£24+£80+£24 = £152.

We have therefore made a loss £8 or  5% of our stake.

So is Each-way betting always a bad idea? No, betting is never that simple!

Consider the following mythical 8 runner field;

Odds of runners – 1/8, 18/1 and the other 6 runners at 100/1 – a 100% book.

If this race was run 100 times; by chance alone, the 18/1 chance will win roughly 5 races, finish second on 42 occasions, third on 27 occasions, and finish unplaced in the remaining 2 races. (Believe me – you do not want me to go into the maths of this)!

If we have a £10 each way on the 18/1 shot in all 100 races, then we risk £2,000. However, our returns are as follows;

1^st 5 times = Return of £236 x 5 = £1,180

2^nd 42 times = Return of £46 x 42 = £1,932

3^rd 26 times = Return of £46 x 26 = £1,196

(18/1 x 1/5 the odds = 18/5 or 3.6/1)

A total return of £4,308 for a £2,000 stake – a profit of £2,308!

The above illustrates that e/w betting can actually be very favourable to the punter under certain conditions. Other examples include handicaps of 16+ runners where the each-way terms would be ¼ the odds for the top 4 places.

For those who are familiar with the betting exchange Betfair, then the place market offers other opportunities but that is for another day.

FORECAST BETTING - I am afraid that this kind of betting truly is a bookmakers benefit. Forecasts dividends are formulated in one of 2 ways. In pool betting (such as the Tote in horse racing or the pool system used at a dog track), the money taken is divided by the winning units – after a % has been taken out of course. The % removed for profit is much higher in the forecast pool than the win pool and it is almost certain that you will lose on this kind of bet in the long run.

The other way that forecast dividends are calculated is simply by the use of a mathematical formula which the bookmaking industry decides upon. This has been reduced and modified down the years so that it is a total benefit to the bookies. Because the man in the street can not work out the maths involved; then they are unaware that forecast & tri-cast betting offers shocking value and should be avoided!. As a general rule, the more the selections in a multiple bet such as a ‘Lucky 15’ – the more the bookies love it as the average return drops ever lower. Of course, we have all read or heard about someone whose accumulator came up or who won the Scoop 6 but the fact remains that these kind of bets keep the bookie in cigars!

One final comment – it is quite possible to get rich backing even money favs as long as they have on average a slightly better chance than 50/50. Back an even money shot each time at 0.99/1 and you are a long-term loser. Back it at 1.01/1 every time and you will be a very rich man!

PLACE BETS  -  I rarely bet 'place only' although on Betfair there are interesting opportunities if one studies things closely. I confess that this is on my 'list-of-things-to-do' still and I hope to eleborate on some useful strategies in the near future. One thing that does seem to be interesting is if there are 8 horses in a race and 1 is subsequently withdrawn, then the place market still pays out on 3 places. Of course, there will be a deduction but if the outsider is withdrawn, then this deduction will be small yet the market will still pay out on 3 places.

LAY BETS - This is a bigger topic and so will be covered seperately in the near future.

Chapter 7 - TRENDS

I am not about to pour water on the theory that trends may point towards future results BUT trend analysis consists of 2 block variables

STATISTICS   vs   EXPECTED PROBABILITY

What is often missing from trend analysis is the second part, which is vital if you are to profit from analysing trends.

As a brief example - let's look at the CORAL CUP. In the RP Cheltenham Guide - 'LONGBOW' points out that the race is a bad one for favs with only 1/10 successful in the past 10 years. That forms the STATISTIC part.

However, as is always the case, he has ignored the EXPECTED PROBABILITY. If we look at the SP of the fav in the past 10 years and reduce the total book to 100%, we get a true idea of how many favs we would expect to have been successful. Last year the fav was 6/1 in a book of 142%. Previous years - 5/1 (142%), 10/3 (128%), 5/1 (122%), 4/1 (137%), 11/2 (132%), 7/1 (141%), 13/2 (139%), 6/1 (136%) & 9/2 (141%).  If we crunch the maths, the expected number of winning favs would have been

1.11 Winning Favs

So, our trend has actually proved that the favs in the Coral Cup are about average. The way that 1/10 winning favs is potrayed as a negative pointer is simply incorrect and mis-leading.

Also, no horse older than 10 has won in the past 10 years. This statistic has a lot more logical truth to it as in this ultra competitve handicap, older exposed horse are always going to struggle. However, with only 5 runners in the past 10 years, when you crunch the numbers based on the SP's, then there is greater than a 99% chance that there would have been no winner older than 10.

Trend analysis is a much understood tool but it can be very valuable but the general press use it to please the masses without completeing the task. I don't have time to go through it all but trends such as 8/10 won last time out are often more than explained by chance alone when you look at the SP of all horses that apply.

Example;

No 5-y-o has won the Champion Hurdle since Eve decided to partake of an apple in the hope that Adam would cover up his dangly bits!

This trend has some scientific basis. Perhaps 5-y-o's are not mature enough? Maybe. The trend has a sound basis and should be borne in mind.

Agreed? OK, now 2 more trends (fictional);

a) In the last 10 years, 8 of the winners had finished first or second on their previous outing.

b) Backing all third favs in novice handicap chases at Taunton in Jan & Feb where the jockey has worn at least some yellow (except on Tuesday's) returned a LSP of £33.20.

Which one of the above is stupid? Both of them are. I find it a little annoying that genuine pointers such as the weight of a Grand National winner are inter-dispersed with CIRCUMSTANCIAL trends.

In the RP today - in the first race of the day at Newbury - TEN YEAR TRENDS advises us that in the past 10 years, the winner's SP has been between 5/4 and 18/1 with a 'Median' SP of 9/2?! Oh good. And there's me worrying about how I was going to find the winner! If anyone is reading this from the (Normally Excellent) Racing Post - then please enlighten me as to why this information takes up space in the paper?? If I was a novice punter or a pro - how would I be expected to use this information? Hello? Earth calling editor......

Seriously folks, when presented with trends, ask yourself if there is any scientific basis behind them or whether they are purely circumstancial. If there have been 8/10 winners carrying less than 10st 11 - then read this as there have been 2 winners above 10st 11.

CARRIED WEIGHT.

I would like to touch on the subject of weight. Much is made about a horse’s mark, or rating and how this has dropped or risen from past runs. I don’t want to go into one and write a book on this subject but there is a factor that you should consider when looking at a horses mark. It is strange to me that if a horse is running again before the handicapper has had time to re-assess; then the horse usually carries a 6lb penalty. So far so good. But this is the case if the horse is a 3 mile chaser or a 5f sprinter. Why is this strange? Well, I run to the bottom of me garden at full pelt and then do the same with 3 bags of sugar; chances are that the time I achieve will be pretty much the same. If I go for a 3 mile jog carrying the sugar, my time is likely to suffer as the 6 lb proves a great burden – and that’s assuming I don’t have to jump.

My point is this – a sprinter in form is a powerful beast weighing a ½ ton and an extra 6lb will have a much lesser affect than 6lb on a horse asked to go for a slog through the mud and jump 20 fences. Common sense. Horses run in and out of form and I am not a trainer or a vet but in my opinion, an over-importance is attached to a few pounds here or there by tipsters and analysts when, although it is a factor, it may sometimes not be as important as the horses current form and well-being.

If a horse is badly out of form, dropping in the weights 5lb will make diddly-squat difference. However, when the horse starts to return to form and he finds that his mark has dropped also, he has a good chance of going in. If he wins nicely and is happy & healthy – then if he runs again, the 6lb penalty is unlikely to stop him. If he gets beat, the exertions of the previous race or the race conditions, luck in running etc etc are much more likely to have made the difference.

The Importance of Taking a Good Price.

I am sure we all go shopping and we rarely get to the checkout without first knowing what the price is, whether it’s a pint of milk or a wide screen TV. If you bet at Starting Price (SP) then you are doing just that. You are asking someone to just let you have whatever they think, no matter how much of a rip-off that may be.

The SP was once the way that the majority of bets were settled. However, over the past few decades, the off-course betting industry has seen some pretty significant changes. I am old enough to remember betting tax of 10% which was reduced and subsequently abolished. Other major changes include the internet and online betting, spread betting and of course the biggest single change – The Betting Exchange. Betfair has had a massive impact in all kinds of ways and will continue to do so. Most of the changes have benefited the punter in his quest for success and it has never been easier to make a profit from betting on horses; but there are still pitfalls that need to be avoided.

The biggest enemy to making a go of things is to bet at SP. I NEVER bet at SP anymore. If for some strange reason I have no other option, I will leave the bet rather than accept the modern SP. As a professional gambler, I am telling you that to make a living at SP is South West of impossible.

Why the big downer on SP betting? Well, 5 reasons immediately come to mind.

1)     The SP return has always served to keep high street bookies in cigars and that is not destined to change. The prices are such that the man in the street has not a hope of making a long-term profit unless he is extremely good at selecting his bets. Even supposing he is, were he to embrace the other options open to him then he would make a much greater profit.

2)     In the past, the opening show on-course was often the first time that prices were available. This meant that the on-course bookie was suitably nervous and so opened his book cautiously and moved the prices out gradually. It would have been very rare for the SP % not to have been lower than the opening show %. Modern day, this is not the case. Early prices are available on every race by breakfast time and even earlier on Betfair. This means that when the on-course bookie has a lot of information on which horses are fancied, how the market has developed before he opens his book. It is therefore reasonable to expect that there will be little overall difference in the opening show book % and the SP %, regardless of the individual fluctuations. What happens in MOST races these days, is that the SP % is higher than the opening show %. Often 4 or 5 horses are shortened whilst 1 or maybe 2 drift. There is no plausible excuse for this and the SP must be avoided. I will provide some sample data on this at a later date but if you watch the market from the opening show to the SP on a few races, you will soon see what an absolute travesty the SP is.

3)     The way the SP’s are reported has changed a number of times over the years. A few years ago, a new way of reporting SP’s was introduced that returned much fairer SP’s for the punter. Predictably, the off-course bookies were unhappy and convinced the powers that be to alter the way SP’s were returned to ensure that they made a much bigger margin. Big Mac highlighted this with his usual vigour but the ‘unjust and unfair’ system is still being used today.

4)     Bookmakers can manipulate the SP quite easily at the smaller tracks where the on-course market is not overly strong. We are back to the ‘I give you my money – you just decide how much to give me back if I win’ situation!

5)     As I touched on earlier – even if you can make a profit at SP – this profit would be very much greater if you had shopped around and taken a better price.

So, what can we do?

1)     At the very least, ask your bookmaker for ‘Opening Show’. This alone will guarantee a bigger return long term in the current climate.

2)     Open an account with Betfair. This will mean that you can take Betfair SP, a new innovation that means that the book % will be on average 105% including commission charges and you can hopefully beat even this by taking a price pre-race. Betfair is an immensely powerful product but to the newcomer it can be a little daunting. The author is a Betfair Accredited Trainer and is therefore qualified and authorised to train individuals or groups on all aspects of Betfair. Email for details on this.

3)     Add  http://www.oddschecker.com to your favourites. This website is free and not only does it show current prices from a whole host of bookmakers, it also provides easy to understand visual information on the market movements of each horse. Open as many accounts as you can. This will pay you back in the long run when you can take the best odds, whichever bookmakers is offering them. There is often a bonus for new accounts opened through our site so if you wish to open an account, then check out the pro-tips or authors website and click on the link to ensure you get any offers that are available.

4)     Learn to assess when a horse’s price is going to drift, and when to take the price immediately. This is an acquired skill and of course it is impossible to ensure you always get the best price available, but reading the market will give you a significant advantage. Betfair is a huge help in this area with graphs showing price movements and trading volumes etc. There are also further third party software packages that will effectively bet for you, that however is for another day.

Just a couple of final thoughts – The bigger the field, the bigger the gulf in value between the industry SP and the Betfair SP. Similarly, the bigger the price, then on average the bigger the difference. 33/1 shots quite regularly are available at prices in excess of 100/1 on Betfair!  

Trading &  Betting ‘In-Play’ – Some Basic Considerations.

Protecting your Stake.

Anyone who uses Betfair will be familiar with the scenario where your win bet trades at a low of 1.2, 1.08, or even 1.01 in running and yet still gets beat! Few things are as frustrating as this when watching a race unfold live. There is however an antidote to this which can be applied skilfully to not only avoid the worst disasters but also, hopefully, to enhance long term profits. I use this tactic regularly and in a sense, there is a similarity to each-way fixed odds betting in that getting pipped may not be a disaster.

As always, things are best illustrated by an example;

Suppose we back HORSE A at 5 for a £10 stake and lay the same horse at 1.6 for a £10 stake.  It is important that the KEEP IN RUNNING option is selected on the lay bet. Let us assume that at some point during the race, HORSE A trades as low as 1.6.

In this example, we have basically paid an insurance premium of £5.30 to protect our stake at the point where our horse trades at 1.6. Should the horse lose, we have broken even. It would perhaps have been nice to ensure a small profit whatever the outcome. This is easily achieved by increasing the lay stake to say, £12. Should the horse trade at 1.6 now, we will have achieved a ‘Green Book’.

Nothing is free though and we have reduced our profit by a further £1.14 if the horse wins.

There are an infinite number of examples I could go into here but that would be pointless. I do have a spreadsheet calculator available for anyone who wants it. Just email me at Billy121only@aol.com

It is important to understand this and other advantages that the ability to trade in-running can offer the punter.

The Theoretical Model

Imagine on your 18^th birthday to decide to start trading the Barclay’s Bank share price for the next 30 years. For those not familiar with financial trading, it is possible nowadays to sit at your PC and buy and sell the share price of a company without having to actually buy and sell the shares.

Anyway, over that 30 year period, you would expect to change your opinion on whether the share price was good value many, many times based on the price fluctuations, available information & forecasts, and your opinion of this information against the share price. A horse race is no different. Even a 5f sprint may see a horse trade as vastly different odds during the course of the race as the horses position and people’s opinion on how well he will fare as the race progresses changes. If we could slow the race down so that it took half an hour, we might make many trades both backing at laying as our opinion of the horses value fluctuates. 

Of course, in reality things move very quickly in a 5f sprint but even then there is a dynamic opportunity to trade in and out during the race. Let us consider briefly a 3m steeplechase. Perhaps the hot favourite clouts the first fence. There are two potential opportunities here. One is to immediately offer to lay the favourite at a bigger price on the basis that the horse, having made a mistake at the first fence, is suddenly less likely to jump and travel well enough to win. Certainly, if you can lay the favourite at its pre-mistake price in a fraction of a second then you are on a long term winner. However, the opposing view is that maybe the mistake was a one-off. No real harm has been done and the people rushing to lay the horse at a bigger price have over-reacted. Maybe you should back the favourite at the bigger prices on offer? Decisions decisions! If you to for the latter option, then if the favourite jumps the next 3 fences fluently then it will almost certainly shorten in price. Now you once again have 2 options – hold on to your bet (which is now good value) in the hope that the horse goes on to win; or lay the horse back for a much smaller, but totally safe profit.

People often over-react to events on the pitch, the track, the press etc. Many successful traders routinely question the true impact of any particluar circumstance or piece of information on the long term goal. If a football team has a player sent off, then the ‘TV pundits’ immediately paint a grim picture of his teams chances of winning the game; the stats show however that the disadvantage is not as sever as peoples initial reaction tends to suggest.

Betting in running actually offers an infinite number of 2-way choices throughout the duration of the race or event and that is without considering how one might adjust the stakes. Just because you have backed a horse for £10 does not mean that you cannot lay £4 off in-running or lay at £20 in- running. The net position is very different in either case of course.

The Trading Model

There is another important point that I should like to touch upon here. If you can back a horse at 8.6 and lay if off for the same stake at 8.4 every time, then you will see your bank swelling more than most punters could ever hope for! If you can buy a car, stuffed toy, antique table – whatever and sell it for 5% profit (assuming your costs are 5% of the profit – the Betfair commission level) then you will be successful.

This type of betting is commonly known as ‘Trading’ and I will be writing more in-depth articles on this in due course. However, the principal is straight-forwards enough. With pure trading, I have a completely different mindset. I neither know nor care how well a horse is going to do in the race. My opinions are irrelevant and suppressed. I am focused on the likely direction of movement of a horse’s price. Much trading is done before the race starts and I am looking to make a large number of very small profits by backing and laying at 1 tick (price increment) difference. Back at 1.8. Lay at 1.79.  Lay at 38, back at 40 etc. 

Betfair has a trading graph for each horse in each race and this can be an invaluable tool in assessing market direction. There are also a number of software packages that work with Betfair to help with this kind of trading. Some software will even trade for you!

How The Race Will Be Run

When looking at trading a horse in running, another key area of opportunity is to assess the horses running style. A front runner, assuming he gets to the front, will usually trade shorter in running as he takes his opponents along. Similarly, a staying handicapper who needs plenrt of driving and tends to stay on late will usually trade bigger in running as he appears not be be travelling too well. The question is, are these price movements valid? Often they are not. Perhaps the front runner is consistent enough but exposed. Maybe he only holds on in 1 race in 12 and so the fact that he is leading mid-race is no justification for the odds to shorten. Are we worried if our horse is being driven mid race from a long way back? Yes, absoutely if this is not typical of the horse but, if that is just the running style of the horse in question then that is normal and there is probably some mid-race value to be had.

When you have watched a race on Betfair; always look at the price graph of at least the winner. It often makes very interesting viewing and will help to build up a picture of how the horse was traded through the race. The process of making the kind of judgement above, like many factors involved in betting, works best in handicaps where all or most of the runners are pretty exposed.

Limitations

Although betting in-running is an exciting and potentially profitable betting medium, there is a major drawback. ‘Live’ pictures and commentary are subject to a delay before they reach your computer, television, mobile phone etc. This delay varies wildly depending on all sorts of parameters but the basic rule is this – if someone has more up to date information than you, then you should not trade as it will be long term suicide. If you are watching a test match in your lounge in Essex that is being beamed from Australia, then there will be an additional few seconds delay as the picture ‘travels’ half way around the world to your TV set. It is essential to bear this in mind.