JB,

About 15 years ago I put together a simple chart that converted win odds into probability of winning based on a long term study of win odds and win percentages in NY. (all odds ranges are not equally efficient relative to the take)

I also studied certain types of horses and the relationship between finishing first and second. Those relationships are also not consistent. Some categories of horses are all or nothing.

Given those percentages, I was able create a second chart that calculated the fair exacta price combining any two horses given their win odds - including and excluding the track take.

My idea was to exploit the inefficiencies between the two pools.

If I liked horse "A" to win, he might be a better value with some horses in the exacta pool than in the win pool, but a better bet in the win pool than the exacta with others.

When I combined my own view of a horse's value in the win pool with the exacta chart that told me whether he was a better value in the win pool or the exacta pool, I could structure my bet accordingly. I could even bet one horse in the exactas and another in the win pools.

The task was so cumbersome I eventually abandoned it because the prices were changing fast late in the betting and was flipping throught charts like madman in the last few minutes. It made my racetrack experience a nightmare. :-)

However, what I was trying to do in theory is pretty darn smart (at least imo :-).

It's similar to an arbitrage between markets like what is done on Wall St all the time.

I suspect the computer users have successfully computerized what I was trying to do manually 15 years ago across many types of possible bets. They are exploiting small inefficiencies in the pools.



Post Edited (09-21-04 18:44)