horse betting

[sleepydragon]

There's a FT article that talks about Horse Betting. 

Nowadays, there are so many data available on each horses, one can build models and derive trading strategies.

 

Has anybody make money consistent from horse betting?

[Dinar]

11 minutes ago, sleepydragon said:

There's a FT article that talks about Horse Betting. 

Nowadays, there are so many data available on each horses, one can build models and derive trading strategies.

 

Has anybody make money consistent from horse betting?

The was an article years ago about a couple of guys who made hundreds of millions of dollars betting on horse races in Hong Kong.  https://www.bloomberg.com/news/features/2018-05-03/the-gambler-who-cracked-the-horse-racing-code

[Gregmal]

I feel like this has been engineered to a house advantage in what currently is called historical horse racing. 

[boilermaker75]

“A man’s gotta make at least one bet a day, else he could be walking around lucky and never know it,” Jimmy Jones, horse trainer.

[Spooky]

That recent FT article on horse betting was super interesting... seems to me that this is the future of investing as well given that Buffett / Munger always compare investing to a pari mutuel system. I've been envisioning a market dominated by rival AI algorithms battling it out head to head (which we already have to a large degree) to see who has the better AI. Where can humans retain an edge in this world? Is it still identifying qualitative factors like management quality / brand value? Or will AI surpass even the greats like Warren? So should we all just buy the Vanguard Total index?

 

I've also been thinking of a side project on training a Buffett Bot... anyone want to look into it with me?

[thowed]

My father did.  It was his career, but I don't think everybody in the business did.  He researched the Form ferociously with meticulous notes & so was a huge inspiration for me when I turned to the stockmarkets.  As well as knowing that they're both industries where you have to accept that the right process won't always produce the right outcome.

[Spekulatius]

My guess is that any AI model will have blind spots that somebody figures out how to brutally exploit and make a lot of money. It’s a dog eat dog world in finance, especially if it’s a zero sum game.

[aws]

It seems like the only way you could possibly win is if you also had one of those rebate deals. If the track takes a 20% commission from recreational players, but only 10% from the professional, then that certainty seems like an insurmountable edge and, depending on how tough those deals are to get, a pretty significant barrier to entry.

 

It reminds me when I was playing a lot of online poker in college. The sites all offered rakeback deals in the range of 10-50% of your pro-rata share of the rake. As the games got tougher, you might be struggling to break even at the tables, and collect all your profit from the rakeback. I expect for horseracing well over 100% of the profit must come from the rebates.

 

I would think that this is quite unhealthy for the industry. The betting syndicates would stop in a second if betting became unprofitable after rebates, so I'm not sure what value they are really adding. But if there presence drives out enough recreational players then the whole system has to shutdown.

[Gamecock-YT]

I've been doing well in a different sport using something similar. There are plenty of blind spots that could cause you problems. Injuries being the big one. But I was winning so consistently I had to start increasing the bet sizes. A lot of work though. Plus always the prospect that if you do well enough that people aren't going to want to take your business. 

[Castanza]

I was told this by a friend who lives in Kentucky and semi-follows the sport: "In investing we have Buffett. In Horse racing we have Baffert" 

 

Bet on Bob Baffert's horse and call it a day if you're hell bent on gambling. Still a lot of corruption in the horse industry. I mean, look at this guy...

 

Edited April 3, 2023 by Castanza

[Libs]

The problem is Baffert's horses get massively overbet. He wins a lot, but not enough to justify getting 3/5 odds all the time. 

[Castanza]

No clue lol I don't bet on sports or anything as I think it's a complete waste of time. Unless you're Biff from Back to The Future and have a copy of the sports betting almanac I see no reason to engage. I try to avoid habits of those who easily part with their money. 

 

Gambling and lotto tickets are right near the top of that list. 

[Gregmal]

Baffert is currently suing Churchill Downs which I found amusing. 

[D33pV4lue]

There is so much corruption in horse racing (PEDS, buzzers, other tactics). I would never devote any amount of time to trying to figure it out. I have my one day at the track every year in Toga and that's good enough for me. But if this stuff does interest you I suggest listening to this podcast episode. It will probably make you rethink trying to create any sort of models. 

 

 

[Saluki]

There are probably a lot of places, besides the equities markets, where people who are smart and numerate are making a killing because they aren't the type of places that finance guys go to, like horse races.  If you are surrounded by people who are innumerate, then "in the land of the blind, the one eyed man is king."   As long as you do it quietly so others don't catch on and crowd your trade, you can keep raking money in.  Like Ed Thorpe did in the early days of the Black Scholles option model when he had a better version of the model, but used it to get rich instead of publishing papers and winning a Nobel Prize. And, he knew what the model the other guys were using was (because it was published!) so he knew it's weakest spots (convertible bonds). 

 

This discussion reminds me of the guy who made a lot of money in the Lottery due to a quirk in the rules.  Again, the Lottery is normally a place that people in finance wouldn't go near. 

 

https://highline.huffingtonpost.com/articles/en/lotto-winners/

 

I've remembered this line for years, which reminds me of the equity markets:

 

"The lottery is like a bank vault with walls made of math instead of steel; cracking it is a heist for squares."

[whatstheofficerproblem]

Ah yes, betting, how can I forget, gambling & betting have a special connection with me, my great grandfather was an avid enjoyer of the sport, he was such a patron that he brought , no should I say dragged, our then extremely wealthy family to below poverty line which took my family two entire generations to toil and get into the lower middle class again. The after effect is so bad that my parents to this day don't like me indulging in the stock market, my grandfather almost beat me to death when he found out I was pursuing a career in public equities.

 

Back to the topic of horse betting, in the show Billions, the main character Bobby Axelrod says that he started winning when he quit following the horses and started following the bets, the guys that bet the last rather. How effective is this strategy? Bet at the end on the horse where there is a sudden inflow of money?

Edited April 5, 2023 by whatstheofficerproblem

[Libs]

I am fortunate to enjoy gambling without having any addictive issues with it. It truly adds spice to life if done in small doses. 

 

That said, I'm deeply skeptical of beating the horse races. Overcoming the 20% take seems impossible, frankly, unless you are an insider like a trainer, and bet large amounts on the rare occasion you have a big edge.