Jan 22, 2015 01:29 AM
Ever wonder where serious professional punters with very large betting turnovers
go to punt? Bookmakers? Betting exchanges? The answer is TABs. I caught up with
a popular broker in the wagering industry who works with some of Australia's
betting professionals and received some valuable insights into where and
how the very large bets in Australia actually get placed.
It sounds a little counter intuitive that the smartest money in Australia is
invested in parimutuel totalizators. Surely that means they drive the odds lower
which impacts their ability to finish on top. How do they ensure that they get
the right price for their bets?
The more questions I asked, the more I learned that the game that they play
is much bigger than just doing the form and having a bet on your top picks.
The form is just one part of a much bigger
betting system that reaps guaranteed returns. The other part of the system
involves precise knowledge on exactly how the parimutuel system works, so that they can place the right bets at the right time to maximise profits. The process starts
with form analysis using complex algorithms to calculate each horse's chance
of winning, producing their own market with odds that represent each runner's chance of winning the race. They feed this information into their
own parimutuel simulators, which also takes into account:
- The size of the bet to place;
- Time before the race that the bet should be placed to determine its influence on
- The size of the parimutuel pool at various times pre-race to help estimate the final size of the pool; and
- The current price of each horse in the TAB market.
Benefiting from Influence of Big Bets on TAB
Social punters are probably getting dizzy from the level of sophistication
involved here. Rather than becoming a victim of shorter prices from big bets
on the TAB, these smart punters are using the parimutuel model to their
advantage. By modeling the wagering system and calculating which bets
to place at a specific time pre-race, they are achieving maximum return from
their bets. We discussed the influence that shortening odds have on the
psyche of punters as they are swayed to bet
on horses with shortening prices close to race time in a recent article.
Australia's smartest punters have modeled this impact and are using it to their
advantage every day of the week.
Simple Betting Example
This thinking is a little on the deep side but if you take a simple scenario
you can see how it might work. After modeling the influence of a big bet on
the market at a certain time, you place a bet at a particular time before they
jump. Say five minutes before the race. The large bet sends the odds for the
horse lower which influences more punters to follow the money and back it, leading
to other horses in the race blowing out. A well timed second larger bet, say seconds
before they jump, on horses that have blown out as a consequence
of the initial bet, allows the smart punter to get a good price for their fancied
runners as their is no time left for other punters to follow the market lead.
TAB bonus for the Big Bets
If you have this sort of information and system at your finger tips, you are
now in a powerful position. The five TABs that operate across Australia and
New Zealand make very healthy margins from their Tote pools, as high as 15%.
The more money wagered in the Tote pools the more money the TABs make, regardless
of the outcome from the race. They are looking for volume, and smart punters
like these can provide it to them. As such, they are prepared to negotiate large
rebates to incentivise these blokes to bet with them. With five TAB agencies
operating across Australia and New Zealand, there's enough interest to achieve
a significant second income for the smart punter.