8% edge laying every single favorite horse

Oh dear.
You really are new here aren't you.

ITDONTWORK!

But if you think it does, paper trade it for a year and then make up your mind!

If you really are new, withdraw your money, spend it on yourself and your loved ones. If you think I am wrong, go ahead with your strategy and come back in a year and tell me I'm wrong. I will still be here and will apologise!

Good news for Ladbrokes, Billy's and Joe's, but you're going to struggle to lay the favs at SP and you're going to get hammered by commission

Thanks Freddie. I will certainly follow his advice for sure, I'm not here advocating people do this or whatever, I wanted to figure out why it works or why it doesn't.

I understand that Slicer, but I'm not getting to the bottom of why this does or doesn't work? Assuming the data is correct, had I placed £100 on every favourite since 1991 I would have turned over millions of pounds, and, according to the figures, I would have made an 8% loss.

I'm not saying this is right, I'm just trying to get to the bottom of it.

So, assuming the figures are correct, had I laid each favourite, would I not have made an 8% gain? Does this not work because of the slight difference in price between backing and laying a selection and the 5% commission?

No one given the OP the answer yet. I don't know if he is a wind up but here goes.

Massey reports are at SP and without commission. If you could lay every horse at SP and without commission you would make an 8% profit.

But there is no where in the world that you can lay at SP, or commission free. You can lay at Betfair SP, and you can pay Betfair commission of, say, 1% if you bet enough. But at those rates you will make a loss.

Laying Every Flat Turf Horse at Betfair SP with Various Commission
5% commission 1.5% loss
4% commission 1.3% loss
3% commission 1.0% loss
2% commission 0.7% loss
1% commission 0.5% loss

So commission takes a wedge out of your winnings, and that fact that you have to offer a price higher than the Bookies SP (which Massey is reporting) means that you can't make a profit laying every favourite.

Now if you were to be more selective; finding races / conditions where favs are overbet you would have an edge and you would make a profit.

e.g.

Laying all Favourites on their racecourse debut 1.3% profit
Laying all Favourites on Heavy ground 6.2% profit
Laying all Favourites ridden by 7lb claimers 2.7% profit
Laying all Favourites trained by M Johnston 1.8% profit
Laying all Favourites ridden by A Culhane 1.03% profit

pittsburgh phil

This might seem like a daft question but am I right to assume that your Flat Turf/BSP stats are from 2008 to date due to the fact that BSP wasn't introduced until December 2007?

Phillyharper, have you ever heard of The Daily Donkey?

I don't know if they're still going but they used to show detailed results of all their lays day by day, month by month, with regular profits in the tens of thousands of pounds monthly. Of course the only reason for their impressive profits was that all their lays were calculated at ISP (industry starting price).

This Phylis chappie sure moves fast for a newbie,take a look at his new thread he is inviting you to put forward your winning methods through his website,another fantasist emerges.

Interesting question Phil,
   your doing something very positive but going about it without respecting various variables that will return a loss in practice.The main problem is that you are basing your 8% backing loss as if you will achieve the same margin when laying when in fact there will be a difference in the cross lay price market of some percent and plus your comms charges added and the fact that some earlier prices records are estimated betfair prices and so are not reliable.

What you should be doing instead is filtering race types , meetings, goings and the like that make a race easier or harder relative to race conditions and factors thus favorites will win more easy races and lose the more difficult races as on the whole the markets are very accurate due to the vast enterprise of price evaluation systems present within the industry and by gamblers alike.

You will only gain on information related edge advantage when you do more homework than the industry which is something you will have to survey for, Adrian Masseys site is quite good for this and there are other databases available, good luck.

Apropos pittsburgh phil's post yesterday.

As opposed to Laying all Favourites ridden by A Culhane for a 1.03% profit how about blindly backing the 2nd & 3rd ISP favourites in races where A. Culhane is riding the favourite?

Since 2008..........

Bets	Wins	SR%	ISP P/L	Races	Race SR%	ROI
299	64	21.40%	58.91	141	45.39%	19.70%

Adrian Massey's site closed months ago!!

@Beat The Overound

Nice post over on that thread. I have only just joined and I have to agree that the level of petty insults is somewhat frustrating. I'm here to learn how to trade effectively. I am not a gambler wanting to throw big money down on low priced favourites and hoping I do well. I want to turn a profit by a high turnover of small bets with effective bank management.

Let me repost your strategy:

Seeing as it's happy hour...

"1. Lay the field at SP to set liability and earn greater than 5% after commission.
2. Lay the field up to $9.00 limit and earn greater than 10% after commission.

If you can't stand the highs and lows, then get out and get a job.

Click and win - simple."

I don't know what you mean by this? Lay all of the horses in a race? Forgive me for not understanding, but could you please clarify?

Thanks.

OK,

I changed some of the settings on the report and chose just the years 2010 and 2011 - both after the time when betfair had SP.

An interesting result emerged. Had you backed the 10th favourite in every single race, it shows a return of 143% based on estimated betfair prices.

Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    2966    67    2.3%    143.7%

Obviously, you're going to need a big bank for that to work, but lets say you placed a £1 bet on each outsider for the whole year? At your 2.3% SR you're going to win twice (on average) before you lose your bank. Possible strategy? My theory behind this is that most of the money and 'wikinomics' that gets the prices so right goes in on the top five horses. With less people putting money on the outsiders, their prices are likely to have a bigger margin of error? What do you think?

Next interesting thing I found, exactly as MrD says, when you put specify estimated Betfair prices on the favourites, the 8% edge completely disappears:

Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    10404    3550    34.1%    99.7%

However, the further down the field you go the worse the market gets at offering the correct odds, check out the stats for the third favourite:

    Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    8938    1226    13.7%    97.8%


And the fourth favourite:

    Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    8571    811    9.5%    95.5%


The fifth favourite shows a profit:

    Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    7989    670    8.4%    108.6%

The sixth favourite shows a big 11% loss:

Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    7050    368    5.2%    89.9%


Looking at laying the third favourite slightly more selectively, in races where there are 10 or more runners, and the distance is above 1m4f, the market is even more incorrect:

Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    2435    281    11.5%    89.3%

Adding the sixth favourite to this selection set to increase turnover gives this:

    Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    4466    393    8.8%    88.7%

If this data is correct - and we can all debate that - laying at £10 level stakes we would have turned over £44,660 over two years showing an 11.3% ROI equal to £5046 profit?

To calculate the 5% commission do we simply say that on average, for every £10 staked, we profit £1.30, and remove the 5% comission from that average return, which is 6.5 pence. So we would profit an average of £1.23 for every £10 staked. At a turnover of 4466 bets, that is £5493 profit?

Did I go wrong somewhere?

One more big of number crunching:

Allowing races up longer than 1m, and races with 8 or more runners, dramatically increases turnover.

    Bets    Wins    Win Strike Rate    Win %Return at Estimated Betfair Odds
All Selections    7475    703    9.4%    90.8%

You're now looking at a 9.2% return (if data is correct). Using the same (possibly wrong) calculations I did before, this shows a return of 87.4 pence for every £10 staked after comission. With a turnover of 7457 bets over two years, you're looking at a profit of £6533?

Slicer, it's all well and good you saying there's a basic flaw in my calculation, but I'm here to learn, not to be tested.

Please just tell me if you can see something wrong.

Forget it. If someone else can see the mistake please let me know.

Should be 8.2% return. Oops.

That changes things on that particular strategy. Instead you're looking at 77.9 pence profit per £10 staked (average) which returns £5809 profit. Total turnover is £80,559.

Still looks like a profitable system though right? I'm looking for a much bigger error in my calculations really, like an incorrect assumption, or something I've missed.

Ok- looks like I have to spell it out:

A 90.8% return for every £100 staked means you get back £90.80 for every £100 staked.

NOT PROFIT!!!!!!!

It is your total return!!!!

I hope that this invaluable posting given freely finally makes you see sense!

Compound Magic, you're exactly correct. I mentioned in all of my posts that I am inverting the data so that I am laying the selections rather than backing them.

Hope that's all cleared up.

So can anyone point out a massive glaring mistake in these calculations then? Where have I gone wrong?

philly you are making some mistakes there. Not just with the maths but with system analysis in general.

The best bit of advice I can give is to not backfit the results. You are running reports and then trying to find bits that stand out. You seem to tweak it a bit and thus show good results which will no way be repeatable in the future.

Backfitting is the biggest mistake punters make. To avoid doing it you need to justify why a filter is in place.

Why is backing 10th favs profitable but 9th favs is not?
Why is backing A Jockey in fields of 8 runners is profitable but backing A Jockey in 7 or 9 runners is not?
Why is backing favourites that last ran X days profitable but X-1 days is not?

If you can not justify why a filter should be included you should not use it.

If you have five minutes read this blog posting I made last year:

http://community.betfair.com/pittsburgh_phil/blog/2010/11/15/5_golden_rules_for_creating_systems

Classic symptons you are showing. You have skipped 1. Fell for 2. and no doubt you are about to set sail on 3. of which you will then perform 4. finally giving up and trying football instead.

Stick with it. But get the fundamentals right first.

I would forget laying for now. Stick purely with backing. Laying requires a totally different mindset.