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The Conscience of Thoroughbred Racing

GIVEN REBATES AND COMPUTER-ASSISTED ARBITRAGEURS, PARIMUTUEL WAGERING IS A BAD BET

HALLANDALE BEACH, FL, March 17, 2023 –Despite the expansion of legal, sports betting to 36 states in 2022, racing more than held its own last year according to data released by Equibase in January. Purses also rose double-digits year over year.

Handle rose just shy of 11% while purses rose similarly to record levels, thanks to a little help from other gambling sources, aka casino dole and sots-like betting machines. But as sports analyst Lee Corso always counsels, “not so fast my friend.”

What these figures do not reveal is how the year ended. Handle in December, with rounding, declined 7.5%, following declines of 4.9% and 4.5% in October and November, respectively, resulting in a final-quarter decrease of 5.5% compared to the same period in 2021.

Of greater concern is that the trend continued into the first two months of 2023. According to the most recent Equibase figures, U.S. handle was down 5.2% in February, which followed a decrease of 7.1% in January even with 163 more races to bet on.

With the expansion of legal sports betting, racing handle likely will be outpaced in the future, begging the question how long can racing hold on as state bean counters, with animal rights groups nipping at their heels, weigh their options.

Indeed, what will happen when self-interested legislators begin calculating the expense of putting on a racing show–with all that valuable real estate just waiting to be re-purposed—compared to installing a few more machines and table games in smaller confines?

Horse race betting has only one viable counter-measure to ensure that its wagering product can keep pace with sports betting and that’s to align itself with sports gambling, the only betting vehicle in which some form of cross-over exists. There has been some, but these things take time.

There is another way to more easily introduce sports gamblers to betting on horses with its steep learning curve and real or imagined unsavory reputation, and that would be the introduction of fixed-odds wagering; the price you bet should be the price you get.

Tom Rooney, grandson of the Pittsburgh Steelers founder, Art Rooney Sr., hit the ground running in his first year as President-CEO of the National Thoroughbred Racing Association, relocating home office to Washington D.C. where he served as a Florida State Representative (R).

Said Rooney recently: “The 2023 gaming landscape promises to be more competitive than ever for the sports wagering dollar. It also represents a huge opportunity to introduce the sport of Thoroughbred racing to a vast new audience if we as an industry embrace the challenge.”

The hope is that he will lead the charge away from parimutuels to fixed odds wagering or, at minimum, as an adjunct to it. I read and I hear that it’s coming. It had better, and sooner rather than later. Both rank and file and serous players have been voting with their feet and walking away.  

As everyone in this space knows, simulcast wagering is a double-edged sword, providing a convenience market at the price helping to kill on racetrack attendance. And live horse racing remains the best and perhaps only means of creating lifetime racing fans.

Surely there always will be an audience for special events such as the Triple Crown classics and Breeders’ Cup, and boutique race meets such as Saratoga, Keeneland, Del Mar and a few others will continue to be attractive destinations.

Great traditional venues such as Belmont Park, Santa Anita Park, Gulfstream Park and Churchill Downs will continue to be major players but will struggle on weekdays and non-event days.

And there is life elsewhere, the surging popularity of Tampa Bay Downs, Remington Park and emergence of Kentucky Downs are good things. But not if the bettors walk.  

In recent years, I have been having a love/hate relationship with the game. Put together an outstanding program and I will support it. We spent last weekend in Oldsmar. It was well worth the time, effort and expense, four-hour drive and all.

It was a losing day but one I’m willing to take the blame for. My handicapping was solid. I bet my share of winners — though there were  a tad too many 1-3 split finishes — but I accept that as part of the game because multiple pools are a bridge to score-making.

But computer-assisted wagering is killing the straight pools and driving players away. The game is rigged against the straight player and it does not help to churn dollars. On balance, racetracks and ADWs don’t seem to care, promoting and pushing bets with high degrees of difficulty.

It has worked short-term. But over the long haul it will continue to bleed the majority of bettors dry as the last six months have demonstrated. But it’s a short-sighted fix. How does racing attract and keep  new fans by promoting high-difficulty wagers while randomly and significantly permits the moving straight-pool goal posts?

I have enough discretionary dollars to be considered a semi-serious player; personal handle last Saturday was just under $500. But I can’t match the arbitrage speed of final-flash computer bettors with whale-sized bankrolls who get roughly a dime back for every dollar bet.

As outlined in last week’s Tote Busters© analysis, we suggested a price play on Graham Motion’s Mission of Joy in the Florida Oaks. We bet enough to assure a profit at 8-1 or 9-1, those prices vacillating in the final wagering minutes. She was 9-1 as she stepped into the gate.  

She scored a hard-fought narrow victory with a bold, wide late rally, showing her potential class in those final yards. I checked the board looking for the running time when my eyes spotted the closing odds. The #1 horse was 5-1.

Mission of Joy dropped four points, literally between flag-fall and that’s-all. She returned $12 even, not even a dime’s worth of breakage. Further, I hit the Pick 5 on a $36 play with 1-2 Tapit Trice, paying a $184.70. There were two $3 horses in the mix, but also 12-1 early-line Mission of Joy, too.

I will tell anyone willing to listen how great this sport is, from the athleticism of horses and riders, to horsemanship, to the satisfaction derived from intellectual triumphs derived by successfully melding art with the science of handicapping.

But in good conscience I cannot tout horse racing as a good gambling game anymore. High-volume players should be rewarded, but not at the expense all other players.

The racing game is rewarding far beyond what sports betting offers beyond the randomness it provides with the proliferation of prop bets–good for bet takers, not bet makers. However, superior race handicapping cannot overcome the advantages enjoyed by a handful of privileged horseplayers.

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9 Responses

  1. Fixed odds wagering on horse racing can help and it exists at Monmouth Park. There is a bill in the New York legislature that would allow it, but it has not attracted much enthusiastic support. There are sponsors in the Senate, but none in the Assembly.

  2. Dan, There’s been a lot of pushback against the Democratic governor in the House, gave Belmont rebuild which she supported a hard time recently. Give NJ credit, they are never afraid to innovate.
    But the movement to fixed odds wagering must go wide. Right now simulcasting is hurting nationally; it’s about the entire game, not just New York…

  3. I too got burned by Mission of Joy’s drop in price as the gates opened. And to be honest, I never would have bet that horse at 5/1 after making an odds line for the race. Now imagine I take a sports betting buddy with me to Belmont one spring Friday after work, and he bets a horse at 8/1, we go grab a beer, and as the gate opens for the race, his horse flashes down to 5/1; as a sports bettor, he is going to feel like he just got robbed if the horse wins. His -180 on the Knicks doesn’t change to -240 when they tip it off. Why would he accept that happening at the track? And what could I even say to get him to come back again?

  4. This is just my opinion and I could be dead wrong, but one of the biggest problems with racing is bettors are not betting their opinions. Most are trying to hit pick 3,4,5,and 6. These bets are hard. For a new player, it is probably “fools gold”.The churn disappears when you bet those bets. I have seen players sit out races as long as they are alive in the picks.Way back when good players made sure they would walk out a winner if their key bets won, not so sure that is the case today.

  5. For the umpteenth time please try to understand how the parimutuel system works! When one horse is bet, any horse, the odds on all the other plodders in the race go up; imagine that if you can. As these geeks with their so-called computer algorithms don’t win every race, just how many of the blue bloods and plugs y’all bet paid more than you anticipated as the odds increased thanks to the geeks.

    BTW, has anyone seen one of these geeks?

  6. Correct. Sadly that’s where the game is these days; convenience and cost savings is ruling the day…

  7. The NFL plays 16 games a week and MLB has that many matchups each day. On a Wednesday in May, the DRF entries page will show a dozen races on North American racetracks with 9 or so races a day. Tom Rooney seems like the perfect person to help reposition the thoroughbred industry and fixed odds are a great start, but the lack of a quality product is the biggest issue horse racing faces.

    Slot machine revenue has made it easier for tracks, that probably would have gone the way of Arlington, to survive. Just because you can, doesn’t mean that you should. When the world isn’t giving you lemons, you don’t try to make more lemonade. There are fewer horses entering racing, yet the industry seems to be trying to keep the status quo that it relinquished years ago. Sure, there are thousands of jobs involved in these various ovals all across the continent, but the world changes and you adapt, or it passes you buy. Look at every storefront business that has closed since Jeff started selling books out of his garage in 1994.

    Most of the sports bettors we talk with every week don’t play the ponies. These are the same people that wait all summer for football to start. Look what happens when that once-a-year spectacle known as March Madness rolls around. According to a report by Challenger, Gray & Christmas, March Madness costs employers an estimated $17.3 billion in lost productivity this year, $1 billion more than in 2022.

    It’s true that “Great traditional venues such as Belmont Park, Santa Anita Park, Gulfstream Park, and Churchill Downs will continue to be major players but will struggle on weekdays and non-event days.” If that’s the case, maybe they should embrace it rather than fight it. I’m pretty sure managers across the USA aren’t worried about their team slacking off today because of the $25,900 feature at Finger Lakes.

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