Betting 360 Ep 007: Dave Talks To Legendary Bookmaker Dominic Beirne – Part 1

by David on June 13, 2013

Betting 360 Podcast - Betting From All AnglesDave talks to one of the biggest bookmakers in horse racing history, Dominic Beirne, who shares the race-form analysis insights that led him to revolutionise the role of the on-course bookmaker.

Dominic is currently more involved in the betting media, where he works as a form analyst for Betfair. He also runs Intelligent Wagering Solutions and provides race planning and advice consultancy services via info@racetactics.com

Punting Insights You’ll Find

  • How Dominic became the biggest bookmaker in Australia.
  • How to keep your cool on race day.
  • The importance of a number of different form factors such as weight, distance, jockeys and trainers.
  • How to use the official handicap ratings to your advantage.
  • How important it is to dig deep into sectional times.
  • Why punters should stick with their probabilities once they’ve completed their assessments.

Today’s Guest:

Dominic’s Closing Tip:

“Well I’ve never seen a set of data that doesn’t improve measurably if you add in the jockey factors, so if you weren’t looking at the jockey factors I think that you’d take up a new career.”

Get the Transcript:

Get the whole transcript here

**Click Here to Read the Transcript**

Episode 007: Dave Talks To Legendary Bookmaker Dominic Beirne – Part 1

Welcome to Betting 360, your number one source for horse racing and sports betting insights. Coming around the bend is your host David Duffield, with another expert view to give you the winning edge.

David:

Hello and welcome to Betting 360, I’m your host David Duffield, and every week here on the podcast I bring on a special guest to look at punting from all angles. Our expert today is Dominic Byrne, a real interesting background and career within the industry, obviously in his mid-twenties, late twenties, he was the biggest oncourse bookmaker in Australia if not the world, and taking on all the heavy hitters, and dealing with telephone numbers basically. So got out of that a few years later, and you’ve seen a lot of his work in the media recently through Betfair, and he has a super computer, a bunch of algorisms, and what he calls his IWS ratings, which have proved to be really quite accurate in predicting races. So very interested to find out what the everyday punter can learn from someone as successful as Dom.

Dominic:

Most days there’s twenty or thirty people in the betting ring, but you were able to set books, and bet rounds, or gamble when you wanted to, so bet round I mean, you would refer to that as a green book these days. So you could pretty much start with next to nothing, and if you had the confidence in the prices, you could grow pretty quickly, and by the time I was twenty seven I had the biggest turnover betting on local events. Bob Lann and McQue betting on multiple events, on the interstate where you had bigger turnovers, but I was the biggest on the local.

David:

And you’ve taken on some pretty heavy hitters, I suppose the pressure, the excitement of a race though, how did you stay focused enough to make good decisions?

Dominic:

Well I always appeared outwardly very cool, I think that for nearly all the time I was pretty cool inside. At the finish there it got rather crazy, the scope of the betting men was completely out of my control, and when you loose control like that, that you could go broke in a bad week or a bad month, it’s not a good business model. And when the stock exchange crashed in ’87, I lost more than half of my clients, and the ones who weren’t in the exchange who survived, still expected to get one hundred thousand dollars on a four to one chance, or twenty thousand each way on a twenty to one chance, which was a reasonably regular bet that I would lay. And we’re talking back in 1988, so it’s a long time ago, that would be a lot of money these days. But I could manage then because if I thought they were the right punters, but there were some who were pretty smart, and then getting off you had therefore no fill in money because a lot of my other punters had disappeared. And I didn’t have any opportunities to get it back because I think at one stage I held 22% of all the money held in New South Wales on Sydney racing events, and there was no one to bet back with because the next biggest holder was much smaller.

David:

So you mention the stock market crash, is that part of the reason why you got out of bookmaking? because you were still pretty young when you left the stand.

Dominic:

Well if I said it was only a business decision it wouldn’t be honest. But if I said well what was the business decision that drove it, I was sending over sixty or seventy million I think in the two years beforehand. And I recognised that realistically, my right amount of turnover was about fifteen or twenty probably, and it wasn’t easy to drive it down to that. So I had to completely change all my attitude on gambling and risk, which wasn’t very easy to do when I had punters as I said, who expected to be maintained at the same level of service.

David:

Alright, and we spoke with Nick Albury last week, he has a background as an actuary, and I believe you did some study along those lines as well?

Dominic:

Yes, I think when I was young..anyway yes I did get into actuarial studies. I think there was only one place you could do it when I was a boy, and it was Macquarie, there might have been somewhere else in Canberra, or in the state somewhere. But it was a great course to do, but unfortunately I couldn’t feed myself very well (laughs) so I only lasted about six or nine months, and then went out and got jobs at the abattoirs, and brickworks and that to survive. It wasn’t until I was twenty-one that I was able to get a Clarks licence. But my training, I didn’t have much training in actuary, but I loved it, and I loved a couple of the subjects. I think one of them was finite differences, which I still use today, and there was this big fat computing science book which, I wish I would’ve stayed and absorbed all of that. Back in 1975 or maybe ’73 or something, I went to university, so that would have been a valuable skill in the mid-seventies.

David:

Definitely. And so how differently do you do the form nowadays, compared to say thirty years ago?

Dominic:

Well I did everything with pencil and paper. I was producing markets when I was eighteen, nineteen on horseracing and greyhounds, so everything was manual though, and it’s completely different these days. We’ve been computerised, I was aligned with Michael Fraser in the mid-eighties loosely, when I say loosely in the mid-eighties we had an arrangement whereby we set up computer. It was mostly Michael’s, I had some input into it, but it was Larry Young who did it, and Larry now runs Centrebet, they change their names all the time, it’s still Centrebet right?

David: Yep

Dominic:

Okay. So Larry went on and worked for Conquer, and he’s a very very clever mathematician, anyway he’s set up most of Michael’s systems, and I’m still with Michael today thirty years later, so the computer science of it has been with me for a long time.

David:

So I’d like to talk about the super computer I suppose, the IWS ratings, I know you’ll only be talking in general terms and that’s fair enough. But are the inputs and also the waiting’s for your assessments constantly evolving? or are they at a stage where you’re comfortable with what they produce and you don’t really tink with them much.

Dominic:

Okay, well I don’t tinkle with the algorisms too often, but something will come up or I’ll read something, and I’ll rewrite something and then test it and see whether it produces a higher profitability. But the co-efficiency on the different factors are in constant change. However I tend to prefer to leave things alone for a period, I mean I don’t go in there and change things too often, because if you’re jumping at every whim, every weekend, you back a loser because you’ve thought oh okay, you’ve had a red hat on a wet track and so therefore I’ll blow that. You know I’m going to penalise all the red hats on wet tracks, then you would be doing yourself a massive disservice. So I think once you’ve sort of set it up, you should let it run for quite a period, and only interfere when you think you’ve got something really valuable to test.

David:

So what’s the indicator, when I suppose the difference between variance or draw down anything like that, and something that you would look at changing in your actual algorithm?

Dominic:

Usually it’s inspired from something that I read. I suppose the profits always an indicator that you should be looking at something, but you know if you go in there and  are re-running stuff reasonably regularly, revising what it’s doing then things are going to jump out at you. And there are trends in horseracing of course, the public are smarter in some areas, and change in some other areas. You asked us a little bit earlier about inputs, well my inputs are pretty much what everyone would use, it’s how you transform the inputs I suppose. You know if you thought that distance was an important input, it might be that you’d have to write something many pages long to suck out all the information you can get out of a factor just called distance, so there’s quite a lot to it.

David:

Okay, well I might ask a few general questions about the importance, or probably the relative importance of various form factors, and more from I suppose, profitability or punting’s perspective rather than just purely a winning chance. So firstly handicapped weight, do you think the betting market exaggerates the importance of weight, gets it about right, or even underestimates it?

Dominic:

Well I’ve always had the view that horses at the top of the weights, have got a much better chance than the public used to recognise, they’ve caught up now and it’s harder to over anything much in horseracing. But I’m not a big fan of people saying this horse has dropped a lot in weight and therefore you should be emptying out on it today, I’m not a big fan of those sort of generalisations. A handicap is very important, it’s there for good reason, and it’s there to sort of try and…you know no handicap is egotistical enough to say ‘oh I’ve normalised all the horses because I had my pencil out, and they’re all in a dead heat’. They’d be an uproar from owners and trainers if handicaps were done that way. However I do think handicap in Australia are way too conservative, and I’d like to see horses going up more for a win, and then coming down much more aggressively when they loose. Now the argument against that from the handicappers point of view, and racing authorities point of view, is that people will say  ‘oh well people play the game’ well it’s not going to take too long to work out what trainers are playing the game, win then run tenth five times, and massively dropping the weight. So handicappers do have an attitude, they have rules about this, they never drop a horse, the run, immediately after a win. So my horse might go up six points for a win, if it runs tenth next start you won’t see it revised down. But there are horses that are running around that run fifteen, twenty times unplaced, and if you look at their handicap ratings they’re just completely uncompetitive, so I don’ think that’s reasonable to owners, but as an input there’s hardly one that’s more important than handicap.

David:

Now what about, I suppose those general changes like in terms of the weight scales, a lot more compressed now then it was ten or fifteen years ago, how quickly do you need to adapt to changes like that?

Dominic:

Okay. Well the computer is probably going to recognise the top weights, that are well treated…if the premise of what you said was true, and it does get a lot of air play that statement, and I don’t know if it’s vividly that true. I think that it’s a long time ago that Desert War was running around right, how long ago was that? was it early 2000’s?

David: Mm Hmm

Dominic:

So it was well cemented then that horses ratings were not going up, in regard to the sum number of wins that they were having at good one level for instance right?. But then again, they might have the ability of going up, but in the old days of course, I mean if you go back thirty or forty years, well they just kept going up for their wins. I would suggest that’s why you’d get this very very large spread. But I would venture to say, that a lot of the horses who win with decent weights, would win with a lot more weight, so I think there is room for a little bit more elasticity and elongation in this spread of weights.

David:

Okay. And how about sectional times, you were one of the first Australian form students to really dig deep into sectionals, do you still consider them really important today?

Dominic:

Oh yes they’re really important. I remember having a conversation with Michael…like Sebastian Coe and Steve Ovet were running fifteen hundred I think, and it was coming up to the Olympics and I was mucking around with the times on some of their other races, and I found it really interesting. And I sent one of my staff to the barrier trials, and he would go all over Kembler, and Hawkesbury, and everywhere, going to the barrier trials, which was a massive advantage over everybody else in the eighties who didn’t have a film of the barrier trials, let alone have all the furlongs clocked. So it’s always been the case that horses can run an exaggerated furlong sectional, compared to other horses are definitely the ones to bet in horseracing. Australia is currently just awash with information and data, and there’s a fair bit of misinterpretation of the data out there. But you know on the other hand the smart interpretation, because there’s plenty of smart interpretation of data as well, the smart interpretation of the data is going to, if not get in there very very quickly, reduce the positive prospect of making cash out of knowing that a horse has got a far sectional. In other words you might have got a ten to one, Cold Diesel when he was running around in certain races, all of a sudden that sort of horse is a five to two now.

David:

Yeah that’s why you need to be constantly evolving. And you mentioned that some of the work that you do is inspired by something that you’ve read, is that a key part of what you do each week, it’s just to constantly stay ahead of the game?

Dominic:

Like I say I don’t probably buy a new book each week, but you might read an article or a paper that inspires you, and sometimes just confirms what you think. Sometimes it completely contradicts what you think, sometimes contradictions are simply because they’re put on a different data set, so I like to keep in touch with what is written out there.

David:

Alright. What about trial form, you mentioned that the work you did many years ago on barrier trials. Today, in today’s punting world do you think it’s overrated or underrated?

Dominic:

Well you’ve got some really smart people that have stuffed it up effectively (laughs) you know you’ve got guys like Tony Brassel and Mark Sheen who…you know we used to go to barrier trials and there would be three people in the grand stand. They’d be Mark Shien, Tony Brassel, and my guy with a video camera.  And if you’ve got really really smart people doing analysis and then the forecasting, then horses are going to be found. So it’s all about the probable chance of them winning, but people like Mark, when he was more focused on tipping and punting, and Tony Brassel, whose always been on the tipping side and not really necessarily a betting person, they’ve had a massive input, and an increasing input of the decade, into the price of first starters and horses resuming from a spell. So gradually as a positive factor, once again the public has just been wisened up, so realistically in many years I discept that the public price is going to be correct on debut horses, it regularly is. I’ve got a point where I never back one, and I just alter my other probabilities around whatever the public price on the first data’s is.

David:

It seems pretty consistent across the gambling world that edges don’t last for long. When I did a podcast earlier in the year with a large tennis syndicate guy, and he was saying if he used his current ratings to bet in today’s market…sorry, in today’s market he makes one and a half, two precent, if he was using it three or four years ago I think it would be more like five precent. And it sounds similar to what you’re talking about in terms of sectionals or trials, that you can get ahead of the game but eventually the market catches up.

Dominic:

And I suspect, from what I hear that Rugby Leagues the same, people that are smart can make five precent on turnovers or more, fifteen years ago well no one was betting with bookies, supposedly it was illegal of course. But lots and lots of people would have a bet against each other like ‘I’ll back St. George today and you back Manly’ and smart people when they were going head to head with a colleague, were just too good. And now the markets I’m told, are just so close to accurate that it’s not that easy to win on any sport. Nevertheless you know people will always love the challenge, and there’s always an edge there you’ve just got to find it I guess.

David:

(chuckles) It’s where the hard work comes in. So just back to I suppose, overrated or underrated, what about official handicap ratings? I know you’ve mentioned those in some articles that you’ve written for Bet Fair, but I don’t think the everyday punter pays any attention to them.

Dominic:

Yeah I’m surprised there not printed more often, I mean of course they don’t need to be printed in most handicaps where the weights are simply a mathematical reflection of the official handicap rating. But in set weight races it is quite valuable for them to be printed, so that’s why I get them out there on the Bet Fair site, when I think there of particular interest. I usually print them if I think I’m in complete agreement, and therefore if they completely reflect the public opinion, and I just want to say you should move on from this race. Sometimes I use the overall handicap ratings to prove that. But it’s important to know, now that you’ve touched on it, that they are more elongated when the horses are younger, so you could look at them and think, well how can this horse go from winning at Bendigo, to winning this listed race in the city, and why did the market place know to put it up at three dollars when there’s a twenty five point difference between it and the other three dollar horse. So it is a very valuable tool the official handicap rating, but you have to know how to apply it, and that’s what I try to do with the Bet Fair clients, is try to keep them as well informed as I can when I think there’s an error.

David:

What about the horses record at the track, is that a big factor in what you do?

Dominic:

Well that’s one of the factors…it is a factor yes.

David:

Okay. Barriers we’ve shown just in I suppose the historical data, that often inside barriers are over bet, that the pub betting public exaggerates the importance of them, and so there tends to be more value out wider, is that what you found as well?

Dominic:

Well…It’s easy for punters to want to back something that looks like it’s going to get a cosy run, you know I wouldn’t go into too much detail about a specific question like that. But the fact remains that if I looked that back over a year and sort of thought okay, well I won a certain amount of money this year, you could probably look back and say okay well I’ve probably won it on maybe twenty or thirty races. And pretty regularly it’s something that looks like it’s got some sort of poisonous factor there, that has turned the public off. And so it might be that it was first up for a very long period, or it might be that it drew a very wide barrier, or it might be that it was going to have to come from last, it was a horse that had a distance change, or something like that. So it’s the sum of the form that’s produces your final probability. I think a mistake that some punters make is that, they’ll do the form and they’ll think something’s a ten to one chance, and it’s twenty to one. Now it’s easy to find out why it’s twenty to one, you could easily easily say okay well I can tell why it’s a twenty to one, because last data found it last, and it looks like it’s had every possible chance. Or it’s drawn barrier twenty four, it’s had three starts on a wet track and failed three times. When it wins at twenty to one, and let’s say it wins one every seventeen, it’s a really really valuable bet, it doesn’t win the rate of ten to one, but it might win significantly better than the twenty to one that the public’s giving you. Yet when it looses and you put your money on it, you think well I’m just an idiot, I knew it always fails on the wet track, or I never back a winner when it comes off barrier twenty four, we’ll you know, you don’t back too many of them right? So I think that you find that the punters, once they’ve done their probability should stick with them, and not try and find the reason why a horse is a lot longer in the public, because my experience is that’s where the money is.

David:

Okay. And how do you incorporate jockeys into the form, some punters really only worry about the horse and they put up with the jockey, but I know you have jockey ratings and the like, so how do you incorporate that?

Dominic:

Well I’ve never seen a set of data that doesn’t improve measurably if you add in the jockey factors, so if you weren’t looking at the jockey factors I think that you’d take up a new career.

David:

And do you feel the same way about trainers?

Dominic:

Ah yes.

David:

Thanks for that Dom, we’ve actually been going for a little while now already, and we do try and keep these around the twenty minutes or so, we’ll leave it there for today and we’ll come back next week with part two of this chat because there’s a lot of other topics that I’d like to really dig into.

Thanks for tuning in to Betting 360.  Get more in depth analysis, tips and that betting edge by heading over to ChampionPicks.com.au where you’ll find a full transcript of this episode.  If you liked the show, share us with a fellow punter or drop by iTunes to leave us your thoughts.  Betting 360, punting from all angles.

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What Do You Think of the Show?

{ 4 comments… read them below or add one }

Frank June 16, 2013 at 8:48 pm

Fantastic to get a insight into the best racing analyst in the country. A man who every racing fan can learn something off.

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Nic June 19, 2013 at 5:45 pm

The transcript for the Dominic Beirne is still part one, will part two be published?

Reply

David June 19, 2013 at 7:48 pm

Both the audio and the transcript for part 2 will be published by lunchtime Thursday

Reply

Harper June 28, 2013 at 4:04 pm

What a brilliant racing mind. Unlike the vast majority of professional gamblers and horse racing experts, Dominc aims to educate the public, rather than to simply provide his judgement – and he does it better than anyone.

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