Profit On The Exchanges: Laying Horses with an Official Rating

While doing a bit of research today I was looking at the Official Ratings of horses (OR) and seeing if any trends showed up. The OR is freely available you’ll find it on the Racing Post and Sporting Life sites.

Now all ratings service produce long term losses if you back everything, the way to use them is to do some research and see if any long term trends are profitable, or be selective. Or, since you know they show long term losses you can look for an edge when laying the horses. So while looking at the OR stats from various angles a couple of race type kept showing profits if you laid them on the exchanges.

Year Ran Win SR Lay PL
 Lay ROI
2008 86 42 48.84 12.52 14.56
2009 82 46 56.1 1.27 1.54
2010 79 42 53.16 8.57 10.85
2011 78 31 39.74 24.44 31.33
2012 58 31 53.45 7.27 12.53

Now some may think the stats above aren’t impressive but when I tell you all the selections were ODDS ON FAVOURITES they look pretty good, especially as the average odds were 1.68. And these results have the 5% commission deducted as well, so if you have less than the default 5% then that means more profits.

So although this system has less than 100 qualifiers a year, it helps you target odds on horses with lay betting.

Free Horse Racing System Rules:
1. Check for races in which the favourite will be odds on, do not use forecast odds, you need to bet near the off.
2. Only bet in CLAIMERS or CONDITIONS races, regardless of whether they are a handicap or not.
3. Make sure the selection is the top rated with its Official Rating.

It is as simple as that. All horses in the race need not have an OR. If just one has an OR then that is the top rated.

The History of the Betfair Betting Exchange

Founded in the year 2000, Betfair has become the world’s biggest betting exchange. In the early days people were a bit wary of it having only had bookmakers to back with for decades, but they soon got the hang of the idea, and with the option to lay horses it quickly became a big hit. Professional gamblers quickly discovered its potential as it offered better odds than the bookmakers even with a 5% commission rate.

Betfair now exists in a number of countries, some of them, like Australia, after a long legal battle, and the spread of this betting exchange continues to this day with the likely hood of a license being granted in California in 2013. Some countries, like the USA currently ban Betfair outright, but most others allow access.

At the end of 2006 Betfair purchased Timeform, a well known ratings service, and now offers most of this information freely via its betting site. Not long after that they launched a radio service.

2009 Became a moment in history for the exchange when the New York Racing Association granted them a license to bet on all the areas race meetings, although Betfair allow bets on all US racing, the agreement with the NYRA means both parties benefit. In 2012 a similar agreement was made the Hollywood Park Racetrack in California. These agreements only allow Betfair to bet on these tracks, not to allow US punters in those areas to bet online.

Floated on the Stock Exchange on 22 October 2010 at a share price of £13, the company was valued at £1.4 billion! Not bad for a company that turned over just under £400 million in 2011, with around £23 million profits. Year on year profits are increasing especially as they are now based in Gibraltar, although they still work from the London office!

Betfair no runs an online casino, an arcade, it covers the majority of sports found around the planet, runs poker rooms, including live poker, has Betfair TV, a forum, blog, as well as running the Tradefair site for financial trading.

These days all the bookmakers use the exchanges, you won’t see a professional gambler without an account, and traders on the betting exchange account for a lot of the turnover, even though the top end can get charged 60% of profits, but then without the exchange the trader’s profits would be 0%.

How Many Favourites Win Horse Races In The UK?

The answer to the question “How Many Favourites Win Horse Races In The UK?” is something everyone one should know who bets on horses as it is probably the best variable for targetting potential winners. So what is the answer?

The figures below clearly show that of all the horse racing favourites over the last 5 years just under 32% won, this includes turf, NH and AW. That is pretty decent, but then when you look at the losses you would have had with a normal bookmaker to £1 stakes your eyes may pop out!!!

Runners Wins SR P/L Exchange ROI Exchange P/L to SP Lay P/L BF
62079 19672 31.69 -2003.34 -3.23 -4850.76 -1996.08

Even losses with an exchange look pretty daunting, although nowhere near as bad as with a bookmaker. Losses if you laid all the favourites are huge as well.

This leads us to two other questions, and also one way of easily targetting more winners:
How Many Favourites Win Handicaps In The UK?
How Many Favourites Win Non-Handicaps In The UK?

Type Runners Wins SR P/L Exchange
 P/L to SP Lay P/L Exchange
HANDICAP 35051 9000 25.68 -1184.32 -3122.59 -1270.7
NON HANDICAP 27028 10672 39.48 -818.72 -1728.17 -725.09

Now we see something not a lot of people in High Street bookmakers are aware of. The fact that out of all the Favourites that run in non-handicap races, nearly 40% win!!

The picture gets a bit mudddied when I tell you that both sets have a negative exchange ROI of 3%. So in reality although the SR’s of both are far apart, they actually both produce the same losses, and this is because non-handicap favourites start at lower prices.

Let us concentrate soley on the non-handicap winners from here on, and we will split the stats into turf,NH and AW and see if anything stands out.

Race Type Runners Wins SR P/L Exchange P/L to SP Lay P/L Exc
A/W 4754 1905 40.07 -111.35 -297.93 -159.89
Chase 3574 1498 41.91 -103.28 -212.9 -91.93
Hurdle 6652 2764 41.55 -206.54 -382.1 -159.25
NHF 1178 392 33.28 -115.69 -161.65 44.9
Turf 9531 3626 38.04 -249.91 -582.95 -309.31

Well the one thing that stands out here is that you need to be extremely careful when getting involved with National Hunt Flat races (NHF). The other 4 categories are fine, but as chase and hurdle races shower a higher edge we will dig a little deeper into individual race types. The reason for additional edge with jump racing Favourites is that the form is more reliable with most horses running year after year.

Type Runners Wins SR P/L Exchange ROI Exchange P/L to SP ROI to SP Lay P/L Exc
 Lay ROI Exc
Amateur 38 13 34.21 0.22 0.59 -1.72 -4.53 -2.8 -7.37
Auction 8 6 75 5.08 63.55 4.71 58.88 -5.56 -69.46
Chase 3569 1496 41.92 -105.22 -2.95 -214.02 -6 -89.58 -2.51
Claiming 155 52 33.55 -21.35 -13.77 -23.58 -15.21 12.51 8.07
Classified 15 7 46.67 6.98 46.52 5.71 38.09 -8.17 -54.44
Conditions 95 41 43.16 3.85 4.05 0.23 0.24 -9.29 -9.78
EBF 20 8 40 -3.78 -18.91 -3.61 -18.06 2.75 13.75
Fillies 36 14 38.89 -2.79 -7.75 -3.98 -11.06 0.68 1.89
Grade 1 254 106 41.73 -1.57 -0.62 -10.25 -4.04 -13.03 -5.13
Grade 2 412 156 37.86 -62.22 -15.1 -71.23 -17.29 41.18 9.99
Grade 3 113 47 41.59 -2.35 -2.08 -5.91 -5.23 -4.09 -3.62
Hunters 308 127 41.23 0.5 0.16 -9.68 -3.14 -18.49 -6
Hurdle 6651 2764 41.56 -205.54 -3.09 -381.1 -5.73 -160.2 -2.41
Juvenile 529 212 40.08 -57.92 -10.95 -69.76 -13.19 29.56 5.59
Listed 89 38 42.7 -7.06 -7.93 -9.25 -10.4 2.5 2.81
Maiden 2380 912 38.32 -66.54 -2.8 -135.52 -5.69 -72.31 -3.04
Mares 761 281 36.93 -84.45 -11.1 -103.81 -13.64 42.4 5.57
Novice 4426 1965 44.4 -148.03 -3.34 -256.78 -5.8 -83.01 -1.88
Rated 4 3 75 4.15 103.73 4 100 -4.47 -111.75
Selling 440 167 37.95 22.87 5.2 6.57 1.49 -50.04 -11.37

In order to make use of the above table you need to target those races that are either showing a profit already, and remember these are based on favourites (including joint), non-handicap races over jumps. You also want to pay close attention to any showing a small loss with less than -2% ROI, as a bit of targetting on your part should easily turn them into profits.

Using the information here you should have no problem putting together a profitable horse racing system.