06/28/2016 10:07AM

Exchange wagering do's and don'ts

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It’s not often you can catch a break living in New Jersey, the land of stratospheric property taxes, grueling bridge-and-tunnel commutes, and no left turns off major roads. So when the Betfair exchange launched exclusively for residents of the Garden State a few weeks ago, it was a much-welcomed bone thrown to New Jersey horseplayers.

Having dabbled with the platform, I'd like to offer a few "do's and don’ts" for the Regular Joe horseplayer. I'm not an expert in arbitraging and I don't have a fancy algorithm to take dozens (hundreds? thousands?) of positions simultaneously to ensure a profit. But just like you, I do like to bet on a horse on occasion, and when I do, I have found the exchange to be a nice complement to my regular tote wagering. Here's some advice from what I have gleaned so far:

Do’s

1. Follow the money

If nothing else, use the exchange to compare prices with the tote and do some value assessment of the field. It's worth noting you don't have to be New Jersey resident to view the live exchange prices here. You just have to be a New Jersey resident to be allowed to wager on the exchange. But if you play any of the exchange tracks on a regular basis, you can use the exchange prices to get a read on what the final tote odds will look like. While tote odds often fluctuate a great deal as post time approaches, the exchange odds often are closer to the true value of the horse. For example, if a horse is being pounded on the tote but cold on the exchange, you may have found a vulnerable favorite.

2. Get in early

Fixed pricing is a beautiful thing. How often have you been dismayed to see the price on your prime play plummet as the gate opens? With the exchange, you can lock in a price at any time. And often the best time to get the best price on the horse that you like is early, before the market settles. If you have done your homework and created a value line for what price you will take on a horse, you may have a better chance of finding that price early. When that happens, I like to lock in at the price with at least a modest win bet. If the price goes higher, I'll dive in and buy again. If it goes lower, I'm happy with my superior position.

3. Ask for more

Don't just take the sticker price automatically on the horse you like. Adjust the odds a few ticks higher and see if anybody bites on your bigger price. More times than not, your price will be taken as long as its within earshot of the latest price on the board. This is a brilliant way of beating the takeout as pointed out on our DRF Webinar on Exchange Wagering.

4. Be an insider

Being an expert on a specific track or circuit can be a huge edge on the exchange, especially early on in the meet before trends become apparent to the overseas and bot players. Trainer patterns such as shipping angles, first-time-starter hit rates, jockey and owner stats can be used effectively here. If you know a trainer is shipping some live horses in from the previous stop on the circuit, don't be afraid to unload on the unsuspecting Euros and casual domestic players. Keeping notes on surface biases on a track is always a good idea and may lead you to even bigger overlays here as well.

5. Make multiple win bets

The exchange only applies its takeout on your net winnings in any pool. That means you can effectively reduce the takeout by making multiple win bets in the same race. For example, let's say there is a big field where you like two horses about equally. If you bet $50 to win on each horse, that means you have put $100 into the win pool. If one of your horses wins, the takeout is applied to your winnings minus the total you put into the pool, in this case $100. You're essentially getting a rebate on your losing win ticket, thereby reducing the takeout.

6. Longshots play longer on the exchange

The vaunted bot players usually are trying to take advantage of the "favorite-longshot bias" that dictates favorites will not be as short as they should be and longshots will not be as long as they should be on the tote. Perhaps the best example of this is in a race like the Kentucky Derby when a horse is 55-1 but the real value is more like 200-1. On the exchange, longshots that are 15-1 on the tote may be much, much longer on the exchange. Think 40-1 or higher. They are begging you to take that bait because those horses are usually hopeless. BUT . . .  what if you actually like the longshot? If finding longshots is in your skills set, check out the exchange prices and don't be afraid to turn the tables on the bots. I pulled this off recently in a maiden race at Woodbine. As you will see in the chart, Wonderland went off at 18-1 on the tote. I cashed at 34-1 on the exchange. Cha-ching!

Don'ts

1. Mispunch a ticket

On a regular ADW or at the track, you can cancel a bet that you miskeyed. But not here. There are no canceled bets on the exchange, which means if you enter a bet by mistake and it gets matched, then your money is committed. Double check your plays! It's easier to mess this up on a mobile device with your fingers. When this happens, you can take opposing positions to minimize your exposure.

2. Be a bookmaker

You can bet a horse to lose on the exchange, basically "laying" a price on the horse. But if you are gonna be on the bookmaking side, be aware that your losses could be significant depending on the odds. It's easy to say on Twitter or to a friend, "That horse can't win!" But how sure are you really? So sure you are willing to lay $100 against possible winnings of $20 if you offer 5-1 odds? If finding bad favorites is a skill of yours, then you can lay them at short-ish prices and do well over time. But favorites have an annoying habit of winning when you don't want them to, so be prepared to get your nose bloodied at some point. In general, don't get into the laying side unless you have a substantial bankroll that can withstand the up-and-down swings.

3. Bet in-race

Unless you have access to an ultra-fast signal or are at the track, this is a bad idea. The in-play betting is a mug game for players who can see horses making moves fractions of seconds earlier than others. The odds change very quickly, and it's hard to keep up. If you are just on a feed with any kind of lag, as ADW and satellite feeds often are, you will be at a disadvantage. And if you are going to dabble here, it would help to be an experienced pace handicapper with access to strong pace figures such as DRF's Moss Pace Figures or perhaps your own homemade figs.