Are favourites poor value?
The quick answer to the question is yes.
When a bookmaker makes his book, just like the casino’s house edge, they keep a little bit of the pie (so to speak) for themselves. For example, the 2:05 Southwell was won by Deal Maker [3/1] trained by Charlie Johnston. The horse placed second, Violet Love, 11/8f, and Awj finished third, priced 17/2. Clearly, the favourite wasn’t a value bet finishing second. The full result on the Racing Post details the total SP [starting price] 113%. A perfect book would be 100%. If you had bet on all of the horses in this race you would lose 13% of your stake. Like all statistics, a bigger sample of data is needed. Imagine if this race was run 100 times. A bookmaker would be confident, based on luck, winning £130 from each £1000 bet.
There is a different angle to this and that’s related to skill. Unlike the house edge at the casino, which is based on luck, an astute gambler can win and it’s the reason why accounts may be limited or closed.
As a gambler, I would rather oppose the favourite. That is my general answer to the question but clearly each horse needs to be assessed on its merits. Although I wouldn’t bet odds-on. If I miss a winner then I can live with it. The reason being, you have to draw the line somewhere. If you don’t, there is no line and whether you believe it or not that is a mistake.
Gamble with a set of rules and guidelines. They should be imposed by discipline.
My friend Eric Winner said that most favourites need to be priced about 3/1 to break even. Once again, that looks at the whole rather than the individual. You can look at horse racing from every perspective. If you are making money then you have found value. You are correct in your understanding.
However, I look to take on favourites because that’s where the value hides. I’d rather look at the third or fourth favourite with the bookmakers which may be 10/1 (could be much bigger on the exchanges so there is even more value) knowing that I only need one in ten winners to break even.
It pays to go against the crowd when gambling.
How can the majority of people be right? Perhaps that is a ridiculous statement (because at times they are correct). Generally, the collective is wrong. In my opinion, betting odds-on leads to poor value. That wasn’t always the case but it is these days.
Set out your gambling approach.
The reason being, if you aren’t in control of your actions then you may be manipulated by others. It all sounds a bit like cloak and daggers but I’ve seen enough, especially on the betting exchanges, to consider there are some very clever gamblers out there who use psychology as a tool of advantage. You don’t want to be on the receiving end of that because you will lose.
For most punters, the favourite is the start and finish of the gamble. They don’t see or bet beyond it.
I appreciate the favourite may be the horse to beat. I’m certainly not afraid to take it on. In fact, I look forward to the opportunity. If you wouldn’t bet on a short priced favourite then the race is made void by that action. But what happens when the favourite loses? You may be thinking ‘I had my eye on that winner and look at the odds it won!’
The next time you see a favourite, don’t be scared to take it on.
The chances are it’s poor value.