Betting the Favorite in 1885

Feb 2nd 2011 07:41 pm |

It is a well known fact in horseplayer circles that approximately 30% of horses who go off as betting favorites, win their respective races. This is a stat that has remain unchanged since at least the 1960s. In 1968, Tom Ainslie wrote in the seminal Ainslie’s Complete Guide to Thoroughbred Racing:

All experts know that, in a representatively large sample of races, one of every three will be won by the betting favorite — the horse on which the most money is bet.

Amazing to think, with all of the technology and statistics made available in recent years, the percentage of winning favorites has remained around 30%.

If we were to go back over 100 years ago, when playing the races for the vast majority of gamblers was nothing more than a guessing game, it would be assumed that chaos ensued.  Without readily accessible past performances, gamblers had little fact-based information to assist them in placing their wagers.  Because of this, one would think, less winning favorites and higher payouts to the sharpies with the inside scoop, right?  Maybe not…

In a little known text at the Library of Congress called “Points” in 1885 the author, identified only as an ‘Old Campaigner’, in presenting his somewhat convoluted view of playing the races, compiled wagering statistics for Brighton Beach and Sheepshead Bay in New York along and Monmouth Park in New Jersey. He found that, on average, over 43% of betting favorites in the mutuel pools won races over the period he studied. Here is his data set:

What do we make of this? In an era before the Daily Racing Form, gamblers were collectively picking the winners 43% of the time? A significant increase over the present-day gambling public, who have the advantage of immense amounts of information about not only horses but their human connections too.

Like all statistics, this raises more questions than answers. One thing to consider, and a possible clue into the high percentage of winning favorites: Pari-mutuel wagering (a relatively new and unpolished system in the 1880s) was likely secondary to playing with the bookmakers. Additionally, the big players likely invested their money into auction pools.  Auctions required a larger investment but they made for a better return than the bookmakers or the mutuels.

Mutuel players had the advantage of odds set by bookmakers and the big players who were buying tickets via the auctions.  Maybe these two sources assisted those investing in the mutuels.  While it’s impossible to know for sure, maybe mutuel bettors followed the bookmaker’s odds and the auction bettors, two groups far more intelligent than the average horseplayer. According to the author, the number of winning favorites in the auction pools also exceeded 40%.   Could this be the reason for the inexplicably smarter gambling public over 120 years ago?

All theories aside, at face value, the 40% statistic could be humbling (or, dare I say, demoralizing) for today’s horseplayer. What do we make of the collective gambler betting virtually blind in the 1880s, doing better then today’s horseplayer who has an unprecedented amount of information at his or her fingertips?

I’d love to hear your thoughts, questions, and comments on this!

NEWS, NOTES, AND OBSERVATIONS

“Points for 1885: Being a Collection of Facts and Figures for Small Speculators by An Old Campaigner, published by Press of Pusey & Rooney in New York City, 1885.  The entire book can be viewed online at the Internet Archive

Many thanks to those who commented on last week’s post about George Woolf…someone mentioned Laura Hillenbrand’s book about Seabiscuit that included biographical details about Woolf which I should have mentioned last week.  Sorry for the oversight…

The Derby buzz started with a bang over the big win by Dialed In on Sunday in the Holy Bull at Gulfstream Park.  I wrote a Ten Things about the Sunshine Millions series for Hello Race Fans last week.  This week i’ll do a Ten Things on the Donn, scheduled to be run on Saturday at Gulfstream.

THANKS FOR READING AND GOOD LUCK!

Filed in gambling,thoroughbred racing history



7 Responses to “Betting the Favorite in 1885”

  1. Jim says:

    Fantastic find. I look forward to checking out the “Old Campaigner”. Keep up the great work.

  2. gary says:

    I would like to have seen average field size as part of the study…the 40% stat is curious but could use the context of field size….as always,an interesting look back….garyD

  3. Undine says:

    You know, I sometimes wonder if all the information and statistics we have doesn’t serve to muddy the waters–we have almost too many handicapping “angles” to choose from. (It reminds me of an old handicapping saying: “Study long, study wrong.”)

    Also, I suspect that the horses themselves have something to do with it. I think it’s possible that back then, before drugs–legal and illegal–completely took over the business, they were sounder physically, thus their form was more consistent, making it easier to predict winners.

    I’m sure there are a lot of other factors, but these are two that come to my mind first.

  4. o_crunk says:

    There are some shocking bits in that short book. Among them are straight bets on the third choice being profitable while straight bets on first and second choice are not.

    These markets did not appear to be illiquid either – where one whale is carrying the day, hoping to separate the “dumb” bettor from their money. A tidbit at the end of the book has daily handle at around $70k – that’s a lot of scratch for back in the day.

    Further, at the author’s implied 5% take and a 40%+ win rate, you’re still losing in a black box betting favorites. Average win ticket paid just slightly above even money (near as I can understand from reading this pamphlet). It was still a tough game, as alluded to by the “Old Campaigner” and perhaps the most striking thing about the pamphlet are that the author’s gripes (complaining about the abundance of sprint races!) and handicapping tips are still sound today.

    That said, I would start to refute this by looking at the what the average winning ticket paid today on favorites. I have a feeling that would start to give an idea of just how short the field were then as compared to today.

  5. o_crunk says:

    One more note: At $70k handle per day, adjusted for inflation in 2010 terms, that’s roughly the equivalent of over $1.5M. Or about the daily handle of a small to mid-size track.

    All that on track without simulcast, OTB or sitting on the couch wagering through the internet.

    Put another way, at $1.5M daily on track would among the highest in the country today along with NYRA or the SoCal circuit.

  6. Jon Luman says:

    While it is interesting to see that the time honored statistics of racing go back as far as 1881. It is nowhere close to news. I make of it, that with all of the material published in the past 100+ years, the limits of handicapping are still at the same place.

    Glad to see that the word is getting out, maybe people will start coming back to horse racing just to play the game.

  7. ML/NJ says:

    It would be interesting to know how many starters there were on average in those fields. At Saratoga Harness I’m pretty sure favorites win 40% of the time. I think the rail horse wins 25% of the time! So things that conspire to give some horses a big advantage probably help boost favorite winners. It would be interesting to see the data from the old Massachusetts fairs which also generally had eight starters and a huge inside edge. Maybe these old tracks had more signifcant biases than tracks do today.

    One other thing about those old races. It’s hard to imagine people betting much money without any real information. You don’t see many people who bet by color at the $100 windows. So there were only a few people with real information and these were the people connected to the horses. I assume the bet then as they do now; but their influence on the pools was greater.