By David Duffield of www.championpicks.com.au
There’s an old saying that ‘lotteries are a tax on people who are bad at maths’ and this holds true for punters betting into bloated markets.
While I understand a lot of people don’t enjoy or aren’t particularly good at maths, I am still surprised that many punters don’t know the basics of TAB or bookmaker percentages.
Do you know the average percentage takeout in the win betting pool by your TAB? And their takeout of other bet types such as quinellas, trifectas and quaddies? Or bookmaker’s percentages and how this number affects your likely profitability?
It’s vital to know these percentages because they represent the advantage that the bookmaker or TAB has. It is this advantage that you need to beat before you show a profit.
To help the uninitiated get their head around these percentages, I’ll use a two horse race with equal favourites as an example.
- A 100% or no commission market would have both horses priced at $2.
- A 118% market (similar to TAB win betting) would have each horse at approximately $1.70.
- A 150% market (similar to a lot of early country and pre-post betting markets) would have each horse at around $1.33.
Anyone taking $1.33 on a coin toss would have to be a money hater, but I’ve never met one of those. Yet so many punters either happily or unknowingly bet into inflated markets when they would almost always be a lot better off by either waiting for the percentage to come down closer to the start time, or by shopping around to find a better price.
Because, everything else being equal, the closer the market is to 100% the easier it is for a punter to win. Anyone betting early on most country and provincial meetings will struggle to beat the big bookie’s percentages. On the other hand betting on metro meetings is normally ultra-competitive and this plays into the punters hands.
Mark Morrissey of Betchoice says “Punters use TAB odds as their guide because they know that market is around 117% so they compare bookie prices to the TAB. When you get to these provincial meetings and they’re betting to 160% early it’s obvious to the punters that there is a lot of percentage in the book because every horse is unders. But we generally bin those 160% markets straight away and frame it to around 125%. There’s an old bookmaking saying “it’s not what’s on the board that matters but what’s in the book”. You can put up 200% markets and still make mistakes but with Betfair and the TAB’s to watch you can get a good guide as to what’s happening. I don’t think they’re doing themselves any favours in the country, I mean it should be about risk management and handling the bets as they come in. I think they need to start working a bit thinner and if the right money comes in just chop them back a bit but going up at 200% is just not a good advertisement for the bookies”.
“Bookies generally consider each other as the competition and they tend to fight amongst the ranks a bit. But really the TAB is the opposition and the tote prices are the benchmark towards which you should be working. Having said that the advent of Betfair has changed things, with the exchange prices going into the ring in Melbourne the bookie’s are seeing what’s happening on Betfair and the markets are getting skinnier and skinnier.
“The markets are coming through at 108-109% for a lot of metro races and it’s getting very very competitive, possibly even suicidally competitive. They can’t last, I mean everything levels out eventually and it will be survival of the fittest. You can’t work at 104% and make money, not with expenses the way they are. I mean it costs us $60,000 a week to run this place and it’s getting to that point now where there is just no margin left”.
While the keen weekend punter doesn’t need to be a maths whiz, it is important that you know the percentage edge that you are betting against on each bet type.