Horse racing is one of the oldest sports in the world. Betting on the sport started in the 16th century.
The main goal of betting on a horse is to win money although some people do it for fun and socialization. In the past, gamblers filled racetracks and enthusiastically placed wagers on specific horses. Today, the racetrack remains a popular sport for socialization and gambling.
Another large chunk of gamblers no longer head to the tracks. They join the fun online and bet on their favorite horse. Off-track betting in the US started in 1978. The entire sport has evolved and horse wagering has evolved with it. This article dives deep into odds in horse racing to help you understand how it works.
Unveiling the Mechanics of Horse Racing Odds
In horse racing, odds represent the price tag and payout upon specific runners on the track. The odds are a representation of the bet you should place and the amount you should expect in case of a win. They differ based on different factors such as how popular the horse is and its winning history.
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What are betting odds and how do they work?
One thing that confuses beginners is knowing how the odds work in horse racing. In the simplest terms, odds represent the amount an odds company (bookie) offers you against the bet you place (bettor). Odds, whether in a racing track or online, appear in different forms.
You might see odds displayed as 7-2 or something like 3/1 or even 4-1. They can be any ratio but it is important to know what the ratio means. The forms present the amount you must bet and your possible win. For instance, a 3/1 odds shows you can win $3 for every $1 you bet.
Two formats of betting odds
Another important thing to know when learning about how do betting odds work horse racing is the format of betting odds. When you are ready to bet online or at a horse race track, you will notice that odds are displayed in two formats. Traditionally, odds makers display them as fractions but in some regions, they are displayed as decimals.
Fraction-based odds on the board usually read something such as 2-1, 3-1, 10-1, and so on. There is no difference if you see them reading as 2/1, 3/1, 10/1, and so on.
The numerator shows the units you will likely win. The denominator shows the stake required to risk to grab the chance to win then units in the numerator. For instance, in a 3/1 odds you must risk $1 to win $3.
It is easy to read decimal-based odds. On the board, they read in decimals such as 1.6, 3.1, 2.0, and so on.
These figures show the exact win you will likely get against your bet. To know your possible win, multiply your wager with the decimal. For instance, let’s say your wager is $40 and the odds are 1.6. Your possible win would be $40 x 1.6 = 64 (including your stake).
How to calculate betting odds and payouts
A lot of gamblers wager on horse racing without knowing how odds in horse racing work. Understanding how the odds work and payout calculation strategy is important. It can help you correctly decide the amount to wager. Odds makers calculate the payoff based on the exact odds but they round it off to the nearest dime.
If you are at the racecourse and betting with the track’s pool betting, what matters are the rules that apply to the specific track. To understand the exact payout, you need to understand the total value in the win pool (all money consolidated in the pool from bets on the winning runners). You also need to know the total bet on the specific horse. Regardless of the total money in the pool, the odds makers do not pay out all of it.
Some of it must remain in the pool as profit for the company while the balance is paid out. The track takes 14% to 20% of the money in the pool before making any payouts.
To help you understand the payout, take the total in the pool and subtract the take. From the balance you get, subtract the total wager placed on your favorite horse. Again from the value you get, divide the wager placed on the horse.
For instance, let’s say the pool’s total is $1,200 and the wager on your favorite horse is $400. This is how you’d calculate.
1,200 x 15% = $180
1,200 – 180 = $1,020
$1,020 – 400 = $620
$620 ÷ $400 = 1.55 which is rounded off to 1.50
A straight bet means wagering on a runner that will take number one in the race. If the horse wins, your bet wins. You have three straight bet options.
WIN. If you bet on a WIN, it means your favorite horse will be number one.
PLACE. If you bet on PLACE, it means the horse may either be number 1 or 2.
SHOW. Another option is SHOW which means the horse can take either number 1, 2, or 3.
Exotic bets require you to bet on two or more horses/races. It is riskier to wager on exotic bets but they attract a greater reward. For instance, you may bet on the winners in two, three, or more races. The bet requires more knowledge about how specific exotic bets such as perms, trixies and so on.
Best odds in horse racing
Once you understand how horse racing odds work, you also need to understand the best odds to choose. When choosing odds, it is best to choose the bookmaker with the best odds. The best strategy is to wager on the BOG (best odds guaranteed) strategy. In this strategy, you will get the highest value if the odds drift at the beginning of a race.
For instance, let’s say you wagered before start and the odds were 4/1. By the time the race starts, let’s assume the odds have changed to 6/1. If your favorite runner wins in a BOG strategy, you will be paid based on 6/1 and not 4/1.
Let’s look at another instance where the odds drop at the start of the race.
Your bet could be based on 4/1 odds before the start but the odds might drop to 5/2 at the start. If your favorite wins, you will be paid based on 4/1 and not 5/2.
Another option is to place bets where odds are higher. For instance, let’s say you bet on a horse with 1.60 odds and another with odds of 4.50. If the latter wins, you get a higher payout, although there is obviously less chance it will win.