03/12/2008 4:14PM

Q&A 3/12/08

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Let's kick off this Q&A with a trio of questions from players who thought some recent payoffs were too low. My point in doing so is not to argue with commenters, but to illustrate the gap between our intuitive sense of what things "should" pay, often based on bad rules of thumb we all were taught when we started playing the game, and how the parimutuel system actually works.

gary says: I was at Gulfstream on Saturday. The sixth race was reduced to a match race between two horses. Communicated went off at odds of 1-2 and paid $3.00 for the win. Ode to Roy went off at 4-5 and would have paid $3.60 had he won. This means the track took 50% of the dollars bet in the win pool on the winner and 20% out of the win pool on the dollars bet on the loser. The track claims to take 17% out of the overall win pool. How can this math work? No matter how you look at it, it doesn't. A two horse race seems to illuminate that the track is actually taking much more out of the win pool than the advertised 17%. Is there any explanation for this? Thanks.

It might seem like the odds in a two-horse race should be higher than 1-2 and 4-5, but those are in fact the correct prices at a 17 percent takeout. Here's how it works:

The win pool on the 6th race at Gulfstream March 8 was $79,212. The amount bet on each horse was (within a few dollars):

Commentated: $43,566 (55%)
Ode to Roy: $35,646 (45%)

Start by subtracting the 17 percent takeout from the $79,212 ,which is $13,466, leaving $65,746 to pay the holders of tickets on whichever horse wins. For Commentated, that's $1.509 for every $1 bet, or $3.018 for every $2 bet, and the $3.018 is riounded down to $3.00 (odds of 1-2) due to breakage. For Ode to Roy, that's $1.84 for every $1 or $3.68 for every $2, which is rounded down to $3.60 (odds of 4-5).

If both horses had been bet equally -- exactly $39,606 on each -- that would come out to $1.66 for $1 or $3.32 for $2, rounded down to $3.20 (at Gulfstream -- in New York, it would be $3.30.)


jeff says: Any insight into the seemingly low exacta payoffs at Gulfstream? Perfect example is Saturday's 3rd race....$27 winner followed by the lukewarm 2/1 fav....$1 exacta pays $37.00??? I usually like playing exactas but GP is either taking out a huge %age...or somehow bettor's are pounding the eventual winning combo??

A $74 for $2 exacta payoff for a 12.50-1 winner over a 2.00-1 runner-up is well within normal parameters -- the combo "should" have paid right around $80 under Gulfstream's takeout structure if the horses were bet in precisely the same proportions in the exacta pool as they were in the win pool. Are you sure you're not confusing the $37-for-$1 with $74-for-$2? Blowing up the $27 win mutuel by 2.9 seems about right for a 2-1 shot, doesn't it? Not that this intuitive rule always works:


rich_hiller says: Can you do some checking on the pay outs of the La. Derby. I have been playing horses 40 years and I have never seen an Exacta pay so poorly on a big Saturday when the pools are large. I know Pyro won the race at 4/5 but he wasn't 1/9. The second place finisher was over sixty to one in the race and when he finished 2nd I thought no pay could be less than $125.00 for a $2.00 Exacta. When the pay was approximatly $81.00 for $2 I was astounded. Was there a computer malfunction?

Unlike the two previous cases, this is one where the payoff does seem low relative to the win odds, but it's a perfect example of how the real market works differently from a straight application of win odds.

At least the reader didn't think the exacta shoulda paid $216, the first expectation of some players when a $3.60 winner beats a 60-1 shot. You can't just multiply $3.60 by 60, because Pyro was not part of "the race for second" once he finished first. So the 60-1 shot is more like 32-1 once you subtrract Pyro from the equation.

So why didn't the exacta pay $3.60 x 32, or $115.20? I think the answer is that 60-1 shots and 32-1 shots are usually significantly lower prices in the exacta pools, due in large part to players who wheel and part-wheel. I don't think that 20-1 shots are used three times more often than 60-1 shots for second underneath favorites. Wheels and partwheels bring these horses much closer together in price.

It's also possible in this particular case that more tickets than usual attempted to beat some of the shorter-priced horses for second. There was good reason to be wary of third and fourth choices Tale of Ekati and Majestic Warrior, both making their season debuts in a two-turn stakes. The actual second choice in the race at 4.50-1 was J Be K, who in a sense was more likely either to win or finish off the board than run second -- you could take a shot on his wiring the field, but if he didn't get loose early, he was likelier to be unplaced than second. So if all these factors made My Pal Charlie more like 40-1 than 60-1 in the exacta pool, the payoff is understandable.


c says: Isn't possible that Daaher was never as good as he was hyped up to be? Let's face it, Midnight Lute was a spent horse going into the Cigar Mile, so his "Grade 1" victory there has to be looked at with some skepticism. Also, Forefathers was the second best horse in the Jerome. That gives you an idea about how good that field was. The more graded stakes they cram into the schedule, the more flashes in the pan we're going to see.

Daaher ran two dismal races this year at 2-5 that were so at odds with his previous races, it's difficult to believe he was physically at his best. We'll never know how really good he was, but his raw talent is undeniable. Maybe he had a glass jaw and never would have been able to withstand top-class early pressure, but when he had things his own way on the lead he was impressive both visually and against the clock. Tens of thousands of horses get loose on the lead every year but few of them run as fast as Daaher did in his Saratoga allowance, Jerome and Cigar Mile.

Download daaher.pdf

I also don't know why we can assume Midnight Lute was a "spent" horse going into the NYRA Mile. He ran pretty fast and was at a huge tactical disadvantage. It was nearly five lengths back from him to Naughty new Yorker, a ultiple stakes-winner and a horse you can set your watch by. I thought it was a solid race all around, and there was every reason to think Daaher would be a major player this year. Something clearly went awry.


richiebee says: While living in NO in the early 80s, I enjoyed shrimp and oyster po boys extensively,resulting in a cholesterol count which resembled a zip code. I'd never heard of a corned beef po boy. Could "cajun kosher" be the culinary wave of the future?

Maybe: http://www.koshercajun.com/menu.pdf