Do Not Bet on Horses ( Until you read this article!):  Horse Betting Exchanges

A “Horse Betting Exchange” Case Study – 20% better profit?

Horse betting exchanges, such as Bookmaker.com, claim that you will get 20% better prices in horse betting. Better prices to the horse player, simply means making more money from winners! Great, everyone would want that…if the claim is true.

We put the claim to the test! We bet the horses…at the track, online with a horse book and at Bookmaker.com  to see which method is most profitable and by how much. We made these horse bets on all stakes races in 2007, starting on January 1 st until March 25 th. We found that by betting at Bookmaker.com, net profits were 20.4 to 29.9% better than if you were to bet the same amount on the same horses, getting tracks odds. Now if you have already become an exchange player, better prices are what you have come to expect and depend on. However, if you have yet to experience exchange betting, you may be unfamiliar with the unprecedented value that they bring to the horse player. You may also need more convincing as to the validity of these percentages. Here is a detailed look at how this comparison was conducted.

In today’s world of horse betting there are three major ways a person can bet on a horse. We’ve defined today’s horse bettor in the following ways.

Traditional Bettor – This player bets the horses at a teller window at the track. He receives track odds based on the pari-mutuel pools, which are subject to the track’s “take”.

Off-Track Bettor – This player bets the horses online or over the phone with a horse book or bookie. He also receives track odds and generally qualifies for a rebate on wagers of 3 to 7%.

ExchangeBettor – This player bets online on a betting exchange, such as ehorseX. He bets person to person, matching prices being offered by fellow players. In addition to 20% better prices, this player benefits from fixed odds, can offer prices of his own and has the ability to bet a horse to lose.

To determine if exchange betting really does result in 20% better profits, we applied the following betting scenario to the three different ways of betting on horses. We assumed a $10 “win” wager was placed on each of the 95 stakes winners of 2007 ($950). We also assumed our players made one hundred $10 losing wagers ($1,000). This is to be fair to off-track bettors, who receive up to a 7% rebate on all wagers, not just his winners. We charged our Exchange Bettor a 3.5% commission, which only applies to his winning wagers. Commissions at ehorseX range from 1.75% to 5% depending on volume wagered. Higher volumes result in lower commissions.

The 95 stakes races took place at the following 11 tracks: Gulfstream Park, Santa Anita, Laurel, Aqueduct, Turfway, Bay Meadows, Fair Grounds, Calder, Oak Lawn, Sunland Park and Tampa Bay Downs.

Here is a detailed look at the results…

1 The average price offered at Bookmaker.com used to calculate profit

2 The best price offered at Bookmaker.com was used to calculate proft.

As you can see, betting the horses on a betting exchange versus traditional methods, simply means getting more from your winners…20% more on average and almost 30% more if you shop for the best prices. A few final notes on this comparison: All stakes races from 01/01/2007 to 03/25/2007 (for which the data was available) were randomly selected for this comparison. No races were excluded because Bookmaker.com did not compare favorably. Out of the 95 stakes races compared, average prices at Bookmaker.com were better than the track 88 times. In the 7 cases the track did have better prices, the price difference was nominal.