Interesting article
We couldn't help noticing the other week some assessed odds published in a racing newspaper for the top five horses in a race. These prices immediately caught our attention.
Here are some random prices of our own. See if you can work out why these assessed odds for the top five runners in a seven horse field would immediately catch our attention:
R3.00
R3.90
R4.00
R4.40
R16.00
Worked out why? If not, here are the odds again with the percentage chances of winning for each one - just divide 100 by the rand odds.
R3.00 - 33.33%
R3.90 - 25.64%
R4.00 - 25%
R4.40 - 22.73%
R16.00 - 6.25%
Total that up and you get 112.95%. Now these prices cannot bare any logical mathematical relationship to a horse's true winning chances. It is not possible for one of those five horses to win that one race approximately 1.13 times every time the race is run. That's what giving those runners a 112.95% chance of winning means. (That's also not including the winning chances of the other two runners.)
Put another way, to easily understand the maths, imagine if we assess the odds of heads and tails for the toss of a coin as both being R1.80. Now we all know they are even money (R2.00) chances.
Now further imagine you are offered R1.90 about heads and tails. You bet R10.00 on each. Every toss of the coin you get a winner and win R9.00, but lose your other bet of R10.00. So you are down a rand.
But guess what. We can claim that you got a value winner every toss of the coin because we assessed heads and tails as both R1.80 chances!
To have mathematically valid assessed odds the market must be priced at no more than 100% taking the entire field into account.
While on the theme of betting odds you can now easily work out what you are up against betting on the tote. Tab websites give you the final tote odds for each race. All you need to do is take each price and divide it into 100 to get the percentage. For example, if the favourite is R4.00, that is 25%. If the next horse is R5.00, then that is 20%. Add these percentages up. You will probably get close to 120%.
Let us assume you got exactly 120%. To work out what the true odds of each runner was, based on the total money in the pool, all you need do is multiply the tote odds by 120 and divide the result by 100. So if the tote odds are R5.00, you end up with 600 which you divide by 100. The true odds you should be getting without the tote cut are R6.00. Now that really let's you know what you are up against. Based on the betting, instead of being paid R6.00, you are being paid just R5.00
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