BETTER BETTING - THE 'VALUE' OF OUR SELECTIONS

BETTER BETTING – THE ‘VALUE’ OF OUR SELECTIONS

The topic is the ‘financial value’ of our selections…not to be confused with our personal notion of the horse’s ‘value’ in the betting markets. This is my interpretation of this topic from “The Compleat Horseplayer” by David Edelman, Ph.D.

WHICH IS THE BETTER BET?
(A)… Even money chances that win 55% of the time, or
(… 20/1 chances that win 10% of the time?

Assuming we have 100 bets of R100 on each of these selections, with the above parameters, the results read.…Stake Return Profit Ave % Profit

(A)…Evens with 55% wins R10 000 R11 000 R1 000 10%
(…20/1 with 10% wins R10 000 R21 000 R11 000 110%

This calculation implies that wagers on ( are far superior.

However, with this method of assessment there is no indication of financial advantage between the two selections. A more meaningful assessment is achieved with proportional staking…betting to win a set amount. Lets say that amount is R100.

With (A), betting to win R100 at evens requires a stake of R100, which at the above percentage profit (10%) translates to R10 profit. Meanwhile with ( the R5 stake required to win R100, with the above percentage profit (110%) translates to R5.50 profit, “an apparently inferior investment” to (A).

This Index of financial value is relatively easy to understand-
Value Index = Average % Profit divided by The Odds
For (A) this is…10% / 1 = 10%,
For ( this is...110% / 20 = 5.5%.

“Such type of risk-adjusted measure is a more true indication of value than mere percentage profit, and is simple enough to be used in practice without complex calculations”.

NO MATTER HOW MUCH WE ARE TOLD, OR READ, OUR GREATEST LEARNING COMES THROUGH OUR OWN DISCOVERY.

Don’t touch the candle, it burns and you will be sore……OUCH!


So much for theory…but how can this concept of financial value work for us?

Firstly, by being ‘open’ to the possibility that such an application can be beneficial to your horse playing, and secondly by ‘doing the work’ to evaluate this with your past and present selections.
The objective, is to identify those areas where we can achieve a greater proficiency from our selections, by means of comparison, and thereafter benefit both in pleasure and profitability from an alternate or amended approach. Some areas to review include-
1. Applying it to your past (and current) selections in the win or place box (multiples and exotics are more complex), and make the comparisons.
2. Applying it to the selections of other tipsters, and make the comparisons.
3. Applying it to the runners from your most favoured stables, and compare.
4. Grading selections (3 star, 2 star, 1 star bets)…identify, apply and compare.

An area for me, is to compare my top rated with my ‘value’ selections (in various forms). Peaks and troughs shall apply. The greater number of examples used shall influence the accuracy of my ‘findings’.
This exercise will be challenging and often mundane, yet there shall be something in it for me at the end of it all, just maybe not what I am expecting!

INFORMATION IS JUST BITS OF DATA
KNOWLEDGE IS PUTTING THEM TOGETHER
WISDOM IS TRANSCENDING THEM
Ram Dass, One Liners

Don't know how smiley got there for (....sometimes ignorance is bliss !

HHP, do you draw up a personal odds line and compare it to the bookies and look for value that way?

UD,
Not any more, used to do 'sheets' yet could not really define any advantage for myself.

Recall some time back, maybe even 4 months, you asked the clan for any 'good books on horse racing'...difficult to recommend then but relative to your question there was a 1990 book called ' Value Betting ' by Mark Cotton (original PRICEWISE columnist if I remember correctly) do not have it, yet read parts of it. His follow-up ' One Hundred Hints for Better Betting' is a good, informative read.
However, the topic of the initial posting really deals with the comparison of selections re 'financial value of the bet', somewhat irrespective of the horses price...that can be fine tuned later for betting strategies. 'The Compleat Horseplayer' is a good book, yet I find I need to read some of 10 times before I get the point...something like consultants telling you something you already know in a language you don't understand.

Hope this provides clarity rather than confussion, it is somewhat tricky.