Making Odds
- By
Charles Carroll
Making your own odds line
by hand is an excellent tune-up for your personal handicapping (see
Part 1, last week). However, once youve tuned up, you may prefer
to computerize it. Computerizing the line frees you to put your
attention where it almost has to be today: planning your bets against
the moving target of the public odds. The days when you could
pick up a Form and be excited simply because you think you have
figured out which horse is going to win are long gone. The job,
now, is to constantly roll with the publics odds. You search for
valueand avoiding being stiffed. So before you start
computerizing and leave the nuts and bolts behind, you should spend a
little time just looking over an odds table. It can be both an
educational and a humbling experience.
A couple of weekends ago,
at Hollywood Park, the entry of Bienamado and Single Empire, with
McCarron and Desormeaux aboard respectively, went off at 1 to 10.
That is ONE-to-TENUNO a DIEZ. Odds about as far
on as they can go. I didnt handicap the race, just happened to
catch it on TV, and sure enough, Bienamado won and paid $2.40 to Win
and $2.10 to Place, while Single Empire ran third for zilch, as there
was no Show money due to the entry. Youve got to wonder how
these things happen. Not that there were two good horses with
great riders coupled as an entry and that they performed as
advertised. A few years back, I saw a four-horse Jack Brooks
Quarter Horse entry in a big dollar race cross the finish line one,
two, three, fourexactly as predicted, but I dont think even that
4-horse entry was at 1 to 10. Just this past weekend, another
three-horse entry by Brooks did exactly the same thing at Ruidoso and
paid $2.80still not as on as the Hollywood Park Bienamado entry.
Odds of 1 to 10 mean that
in the publics opinion, that horse (or entry) has a 90.91%
probability of winning. (A reference table of odds and
corresponding percentages can be found in the article library of
iCapper)
If you are handicapping a
race with ten or twelve horses in it, how bold do you have to be as a
handicapper to set an odds line with a horse rated at 1 to 10? If
you have been to the races more than once, you know something about
racing luck and its converse, racing bad luck. Id
venture a guess that simple racing bad luck can affect more than 10% of
any horses performance capability. The horse next to it in the
gates can rear up. Fabulous horses can stumble at the
start. Great horses get boxed in by lesser horses. Jockeys
go too wide, or try to squeeze too close to the rail. You name
it, it happens. There is a greater than 10% chance that any
given horse will get less than a perfect trip. How much,
then, do you have to like a horse to say that although it may have to
overcome a bad trip, it still has a 90.91% probability of
winning?
I cannot imagine ever
making a horse 1 to 10 in my own odds linegiving that horse a greater
than 90% probability of winning in a field greater than twomuch less
betting on it. Which brings up an interesting point: just
how far on would you be willing to go when setting odds on a
stand-out horse andassuming you are even a tinsy bit conservativewhy
is the public willing to go so much further?
It sometimes seems that
newer, grander notions of the crowd have crept into our basic
concepts of the sport. I sometimes suspect this was a subtle
influence of the Dr. Z syndrome, which included a basic premise: The
crowd is smart, so let them do the handicapping and analyze them.
Well, the crowd is not that smart. In fact, the idea is
sort of self-contradictory. It the crowd was really
smart, there would be no overlays for Z-market analyzers or more
normal run-of-the-mill handicappers. You dont have to look far
for evidence. One of the quickest proofs is the crowds piling
on over-bet underlays.
So that were all on the
same page, an underlay is a situation in which the odds pay-back for
a horse is less than its legitimate shot at winningor more accurately,
pay-back is less than the risk imposed by its legitimate shot at losing.
For example, suppose you do your best handicapping and develop an odds
line, as suggested last time, and you make your best horse a legitimate
4 to 1 shot. Suppose too, that you are good at this and have
confidence in your line. The public odds at Post Time drop to 2
to 1. Your handicapping gave this horse a 20% (4 to 1) chance of
winning this raceconversely: an 80% chance of losing. If you had
made this bet at your fair odds of 4 to 1, you would get back $4 for
each dollar bet. However, the public is only offering to give
back $2even though the risk is exactly the same. Thats an
underlay. Conversely, say this horse is your top pick at 4 to
1, yet the crowd loves another horse, which you have pegged as a false
favorite, and offers you 6 to 1. That is better than your fair
odds, and it is an overlay. Overlays are the key to a
gamblers edge in horse race betting (see the earlier article, Finding
Your Edge), and there is a lot more to overlays than simply exceeding
fair odds. One of the fundamentals is that before the race is
run, no matter how good you areNOBODYnot you, not the crowd, not
Steve Wynn, not even Jimmie The Wasp and Lauren Stich during their
Balleys triumphknows exactly what the true odds of the race
are.
Since there is always
some error in the fair odds that you estimate, you will eventually go
broke if you accept only fair odds. In order to buffer against
the inherent error of your pre-race odds line, you have to sit on your
money for fair odds as well as underlays.
Underlays can happen in
any odds range; they dont have to be odds on. In fact, its
probably more common at more normal odds ranges. A horse you make
10 to 1, with no prayer as a contender catches the crowds eye and
drops to 4 1, becoming a drastic underlay.
Most of this has to do
with simple mob psychology. Youve seen it happen: your 10
to 1 horsea completely dead pieceis sitting at 25 to 1, and ten
minutes before post time, blind long-shot betting kicks in and it
rapidly drops to 6 to 1. Im sure youve also seen these same
blind long-shot bettors turn away from the window, look up at the odds
board and mouth surprise. If youre a good lip-reader, youll see
more than that. They were caught in a landslide and dont know
what hit themthey thought they were getting 25 to 1what
happened?
Blind
long shot betting is the road to ruin, but at least its simple,
straightforward, and I can understand it. What I do not
understand, is eyes-wide-open piling on of large amounts of betting
dollars onto big, fatobviousunderlays.
At 1 to 10, in order for
the Bienamado entry to be an overlay, what would you have to
make its fair odds? One to fifteen? One to
twenty? The fundamental criterion of value betting is that
the horse is offered at greater than fair odds. So in order to be
a value bettor and bet on a horse at 1 to 10, you would have to
strongly believe, based on your own handicapping, that this horse had a
better than 1 to 10 chance of winningsay, 1 to
15.
Maybe you could imagine this in some bizarre scenario in which Cigar in
his prime might be dropped into a $2,500 claiming race at Bandera
Downs, but in the reality of carding races, there has rarely been such
a thing as a true 1 to 15 horse.
One of the oldest angles
of railbirds was to watch for sudden drops in odds, just before post
time. The idea was that this was the smart money and you could
jump on for the ride. Sometimes this one even worked.
However, when the drop is not sudden and noticeable, but prolonged and
extreme, it is not smart moneyit is dumb money. When odds
start getting down into the even money (1 to 1) range, you can be
pretty sure that the cash flow is not coming from value bettors.
Value bettors would have
to be giving this horse fair odds of greater than 1 to 1 to take this
bet. When the odds on a favorite get down into this rangeand
would continue declining if the track didnt mercifully stop the
madness by loading the horses into the gatesthis is simply piling on
by the crowd. Which is actually a wonderful thingeven though it
may sometimes kill your opportunity to bet on a race you worked hard to
handicap. It proves that the public is not made up of genius
value bettors, and that the herding instinct remains strong. It
is extremely wonderful if you never liked their choice in the
first place and by piling onto their even money horse, they relieve the
pressure on your personal favoritea legitimate 3 to 1 horsenow
standing at a juicy 7 to 1. Thats an overlay and thats next
week.
