ATTAINABLE GOALS

UNFAIR GAMES VS. FAIR GAMES
In unfair games, a maximum boldness strategy is optimal: Craps, Roulette, Slots, Black Jack.In fair games, a minimum boldness strategy is optimal: Poker, Sports Betting, Horse Racing.So if you were rolling the dice in Las Vegas, a game where the odds will be against you, you would be smart to bet all or most of your bankroll on a few rolls and hope to be lucky. The longer you play, the more likely you will lose.

If you're playing the horses, and you have become a talented handicapper, you're smart to bet a relatively small amount (2% of a bankroll) on a large number of races you understand, and depend upon your skill. The longer you play the more you win.

HOW MUCH MONEY CAN GOOD HANDICAPPERS WIN IN A YEAR?
It depends upon:
(A) Your skill
(B) How much you bet on key horses to win

YOUR SKILL
If you know your win percentage and the average odds on your winners, you can estimate your winning edge. Your edge is equal to your win percentage multiplied by your average odds on winners, and that product minus your loss percentage.

The amount of money you can expect to win is equal to the amount you bet during the year multiplied by your edge. So if you have a 22% edge on the game and you bet $100,000 during the year, you can expect to win $22,000. Which is a nice profit from your hobby and an exciting game!

Here are the attainable goals for skillful handicappers:

Win%	Aver. Odds	Edge
30%	5-2	.05
33%	5-2	.15
35%	5-2	.22
40%	5-2	.40

The average odds are held constant at 5-2 because in reality they do not vary much on key horses to win.

The edge is equal to your return on investment (ROI). If your edge is 20%, that means for every dollar you bet, you can expect to get back $1.20. Investors, savers, and business men and women would be pleased to do as well.

Notice that handicappers who improve their skill by 10%(30% to 32%) have tripled their profits (.05 to .15). How nice! It pays to improve your handicapping.

THE AMOUNT OF MONEY YOU BET
Nobody can make a decent profit at the races by betting $2, $5, or $10 on key horses to win. Bet size should vary between $20 and $200, beginning at the smaller amount. Handicappers can increase the size as experience, proficiency, and confidence allow.
Because newcomers and casual handicappers invariably are curious to know, most leading handicappers and successful players bet $200 or thereabouts on the one, two, or three key bets to win they find on a day at the races. Some bet significantly more, and others bet less than half as much.

As a rule, handicappers can expect to find one, two, or three key bets to win each day, an average of two. If regular handicappers play 200 days in a year, the number of key bets to win will be 400 and the amount wagered will be between $8,000 ($20) and $80,000 ($200).
Now would-be handicappers have a basis for estimating how much money they might make when betting to win in any calendar year. Imagine yourself a successful horse player and plug yourself in at one or more of the handicapping and betting levels in the grid below.

$20 WIN BETTOR

WIN%	ODDS	EDGE	BET	BETS	INVESTMENT	PROFIT
25%	5-2	(.12)	$20	400	$8,000	($1000)
30%	5-2	.05	$20	400	$8,000	$400
33%	5-2	.15	$20	400	$8,000	$1,200
35%	5-2	.22	$20	400	$8,000	$1,760
40%	5-2	.40	$20	400	$8,000	$3,200

$200 WIN BETTOR

WIN%	ODDS	EDGE	BET	BETS	INVESTMENT	PROFIT
33%	5-2	.15	$20	400	$80,000	$12,000
35%	5-2	.22	$20	400	$80,000	$17,600
40%	5-2	.40	$20	400	$80,000	$32,000

In the age of full-card simulcasting, successful handicappers are playing multiple tracks each day, or more precisely, one-two-three bets at each of multiple tracks. Profits that formerly accumulated just at the local track can now accumulate at two, three, or four tracks each year. So dedicated handicappers, by all means, can multiply the potential profits resulting at one track from their skill by two, three, or four.

None of this has any relevance to exotic wagering. Successful handicappers also play the daily doubles, exactas, trifectas, and serial bets such as the Pick 3 and Pick 6 every day. The edge on any exotic wager depends upon the value expected from that specific betting situation, and is relatively unpredictable from year to year, or even from month to month, week to week, and day to day.

Effective strategies for playing the various exotic wagers are important, and they will be described in detail in this CD-ROM, but they are not related in any systemic way to the profits talented handicappers can expect year after year.

PRIME BETS TO WIN
A standard of excellence in handicapping is the ability to earn a 20 percent rate of profit on prime bets to win. A prime bet means a high-probability contender that has a clear decisive edge on the field and has been offered at a fair price. Numerous handicappers are talented enough to satisfy the 20 percent standard. But few do.

Handicappers who win 30 percent of their prime bets at average odds of 5-2 share a 5 percent edge on the game. For every dollar wagered to win, they receive $1.05 in return, a 5 percent profit.

A handicapper who can win as frequently as the crowd, 33 percent, but at 5-2 odds (the public averages 8-5), boasts a splendid 15 percent edge on the game. As Dick Mitchell has pointed out, by improving handicapping proficiency 10 percent, profits triple. This is the attainable goal all recreational handicappers should set sails to achieve 33 percent winners, average odds of 5-2, a 15 percent edge and profit margin. The reality for the casual majority is closer to 30 percent winners at odds of 5-2, a mere 5 percent profit margin.

The "edge" is important. A handicapper's true edge on the game suggests the optimal bet-size. It's the edge divided by the odds to $1.00. If the handicapper has a 5 percent and the horse is 5-2, the optimal bet is 5/2.5, or 2 percent.

To bet more is to bet too much in relation to actual proficiency, and guarantees a long-term loss. Overly aggressive betting is ruinous in horse racing. To bet less is to win at a rate of profit less than actual proficiency allows, a sad but not desperate circumstance.

VALUE BETS TO WIN
Value bets to win involve horses having a handicapper's reasonably good chance, but at conspicuously generous odds. The odds will be twice as great as expected, or longer than that. Instead of fair value, the handicapper perceives excellent value, perhaps outrageous value.

The horses do not figure convincingly, and many will not be first choices. Betting decisions remain equivocal, but the price exerts an undeniable pull
In certain situations, as in contentious races, the horses may be mild first choices offered upward of 8-1. That's value, as the horses can be expected to win at least once in eight attempts, probably more than once.

Or, the value bets may be unexpected overlays at 10-1 or better in contentious fields where lukewarm first and second choices have been overbet.
In predictable races, first choices may be severely overbet, leaving the handicapper's second or third alternative as an outstanding board attraction.

Or false favorites may be ridiculously overbet, such that a pair of reasonable alternatives go to the post at very attractive prices.

Or an angle horse in a relatively unpredictable race may be offered at irresistible odds.
Value bets are characterized by lower probabilities of winning than prime bets, so losing runs can be extended. If a horse has roughly a 20 percent chance (4-1), actual odds should be 6-1. A horse that has a 15 percent chance (6-1), should be 10-1 on the board, or better. A horse having a 10 percent chance (9-1) should be 15-1, minimum.
Bet-size should be a portion of the prime bet to win, not an equivalent amount. Stronger opinions can receive 50 percent of prime, weaker opinions 10 to 20 percent.
How will recreational handicappers know whether value bets to win are tossing real winnings, or losses?

It's strictly an empirical question. Handicappers must keep a record of the value bets and study the results. A year's worth of results on 8-1 shots, or greater, reveals the trend. Two year's data tell a fairly accurate story.

BETTING TO PLACE AND SHOW
Whether expert or novice, mass confusion thwarts veritably all attempts to earn money at the races in the place and show holes, which is possible but improbable.

Recreational handicappers should not bet overlays and longshots to place or show. They are probably underlays in those pools.

Alternately, low-priced favorites can often become overlays to place and show. Odds-on favorites often should be bet to place and show, not to win.

Exacta bettors commit three mortal mistakes every racing day.
The put too many overbet favorites on top, thereby creating numerous exacta underlays.
They buy exacta boxes connecting three horse--baseballs--routinely, usually a nonsense bet. They bet exacta wheels, absolutely a nonsense bet.

Remember these maxims:
1. Overbet favorites should be used primarily on the bottom of exacta combinations.
2. Exacta boxes make sense only when both sides represent overlays.
3. Key horses should be coupled in partial wheels only, limited to other contenders that are overlays.

Exacta bettors must realize the nature of the exotic risk opens the possibility of extended losing runs. Low-probability events can happen infrequently over longer periods, certainly throughout the run of a race meeting.

The exacta is the competent contemporary handicapper's best friend. It affords the occasional customer a chance for meaningful profits in the short run, as win wagering does not. If recreational handicappers respect the bet and play it smartly, they should do all right much of the time, and at times they will reel in the big ones.