Racing commission / takeout

Hey,

in my quest for new ways to gamble, I am ready to cross sportsbetting off my list. For football, basketbal and such, the games take just too long for my taste. And in racing the commission (or whatever it is called) is just too damn high. Which brings me to my question:

Why is that so? Parimutuel betting would work just as fine just collecting a 5% commission off of each bet, for example. 14% , 17% , even 19% is just ridiculous. And the casinos could just offer this by themselves, why do they need these sportsbetting networks? At the end of the day, betting on horse 1, 2 or 3 is not that different from betting on numbers on a roulette wheel. (Parimutuel roulette, anyone?)

Morever, an affordable (low commission) parimutuel betting option would be very interesting for me as a gambler, as in some way it allows me to go up against other gamblers, not the house. And for the casino side it is completely risk free, they will collect their cut no matter what...

What am I missing? Thanks!

You cannot consistently offer bets on any sport event unless you can more or less estimate their probabilities. Having a 15% vig is a clear sign of saying 'we don't know anything about this evemt. We just hope our estimate is well within 15% range'.

Second, you run the risk of non-runners. If your race has 10 equal strength contestants, you cannot offer lines at +950 for a 5% vig. Because if one contestant will not start, his bets usually pushes, and the fair line would shift to +900. Either you need to decrease your lines for non-runners after the race (and piss off your customers), or you factor in an increased vig for compensation. Of course if favourites do not start, adjusting the lines afterwards is still common.

Do you know what that commission is taken off for?

The purses they race for get about half
Half goes to the racetrack to cover costs, building lighting taxes water upkeep, promotions, advertising , salaries
Part goes to cover the costs of drug testing the horses that race

You talk of commissions upwards of 19%.....I almost hurt myself laughing so hard at that....as its kind of a low estimate

ASSOCIATION PERCENTAGE, AND TAXATION/LEVY
The Woodbine Entertainment Group deducts and retains the following percentages from wagers placed at our own licenced
sites which are then shared with the horsepeople, host and simulcast associations and the Ontario Racing Commission.
WOODBINE\MOHAWK LIVE: Win, Place & Show: 13.65%. Triactor & Pick 4: 21.7%. Double & Exactor 17.2%. All other 23.0%
GRAND RIVER: Win, Place & Show: 20.7%. All other wagers 21.6%
FLAMBORO & GEORGIAN: All wagers 21.4%
FRASER DOWNS: Win, Place & Show Wagers: 13.5%. Double, Exactor & Triactors Wagers 20.5%. All other wagers 22.5%
HIAWATHA: All wagers 21.3%
KAWARTHA: Win, Place, Show, Exactor, Triactor and Double Wagers: 18.0%. All other wagers 21.3%
NORTHLANDS: Win, Place & Show Wagers: 12.5%. Triactor Wagers 19.5%. All other wagers 21.5%
RIDEAU CARLETON: Triactor Wagers 21.95%. All other wagers 20.75%
SUDBURY DOWNS: Win, Place, Show Wagers: 14.9%. All other wagers: 23%.
WESTERN FAIR: Win, Place & Show: 18.1%, Win-4: 15%. All other wagers 23.0%
WINDSOR: Win, Place & Show Wagers 18.1%. All other wagers 23.0%
Horsepeople receive a further 2% on all wagers, except triactor wagering where it is 4%. The Ontario Provincial Government retains 0.5% on all
bets placed in Ontario. The Canadian Government (through a revolving fund cost recovery basis) retains 0.8% on all wagers placed in Canada for
provision of drug control, photo-finish, video patrol and audit services.

As a horseman, holding Thoroughbred licensure in KY and CA, I maybe can add something. The takeout (the term for the vig in racing) is cut up among many entities--the racetrack's profit obviously, plus state taxes and--most importantly--funding the purses.

Racetracks aren't cheap places to operate. Even the smaller tracks take up a lot of acerage. Payroll is burdensome. What they make on stall fees (what a horseman pays the track to keep his horses on the grounds) is minimal--about $2/day per stall.

It simply has to do with the nature of the physical plant and human resources (not to mention equine resources) of the racetrack. They a lot of overhead.

I know little about horse racing and even less about betting at a race book, but the way I read the original post was this:

It sounds like the race books payouts are based upon the trackside paramutual payouts, but that there is an additional commission that is kept by the race book.

If my assessment is correct, then, as a compeltely ignorant observer, I'd agree that the 14% or more is too high.

I agree that race track take out is high, but we must keep in mind that sports books do not facilitate the actual event like race tracks do. At the race track, take out from wagers must pay for essentially all the operations of the track, since at most entry fees, concessions, broadcasting rights, etc. are worth very little. In NFL betting for example, the originator of the wager must only cover the cost of operating the sports book, not facilitating the event.

At sports books in Las Vegas, full track odds are generally paid up to certain limits. For example, I've seen posted rules that limit Win payouts at 40 to 1 or so, Places at 8 to 1, Shows at 4 to 1 and exotics at 300/1. I have never encountered any of these limits while race betting in Vegas so I can't speak to how they are enforced.

So the real problem is that the entire horseracing industry is funded by gambling. I don't even care about horses though. So let me bet on something that is either

- a lot cheaper to pull of (rat racing, washer / drier racing, monkey knife fights,...)

- something that is happening anyway (basically any sporting event would qualify, I think the Biritsh are way ahead in this field, I've been told you can bet on anything anytime)

To reiterate my point: Parimutuel betting is very appealing to me, but it is only available in racing with far too high take outs. If the casino finds another way to offer me parimutuel betting with a 5% commission and 10+ events an hour, they will have my business.

Racetrack takeout is a constantly controversial topic.

Here is a relevant article in which the general manager of a racing wagering website claims a correlation between the take percentage and handle.

By the way, the wagering website mentioned is Premier Turf Club, which is known for big discounts and rebates. Note that in the article that they can reduce the take in some instances to around 10%. As I recall, when Premier first opened, they were offering rebates that brought the take down to 7%, for all customers who bet over $3,000 per month.

Quote: tupp

Racetrack takeout is a constantly controversial topic.

Here is a relevant article in which the general manager of a racing wagering website claims a correlation between the take percentage and handle.

By the way, the wagering website mentioned is Premier Turf Club, which is known for big discounts and rebates. Note that in the article that they can reduce the take in some instances to around 10%. As I recall, when Premier first opened, they were offering rebates that brought the take down to 7%, for all customers who bet over $3,000 per month.

Thx for the link! We might see change for the better...

Thats what horse bettors thought when many areas got slots at racetracks...figured great they will reduce the takeout now that they are getting MILLIONS off the slots. OPPOSITE HAPPENED they in many cases raised takeout on wagering.

For example people who bet races from PENN STATE are paying I believe around 33-35% takeouts believe it or not....and they are making millions the tracks off of the inhouse slots...... guess they dont want racing and the easiest way to get rid of that is by saying look nobody bets the game anymore

Ontario has given notice the GOLDEN GOOSE that has given out get this $4 BILLION to tracks and horsemens purses will fly away March 31 , 2013. The tracks did nothing to increase the fans in the stands now most will close the doors

California has just approved Exchange Wagering. It's on its way. The way I understand it, people can offer bets to other people.

For example, I'll give you 3-1 odds on Horse #2 winning. One person betting, one laying. I believe the takeout is supposed to be a little less on wagers like that.

I find it appealing when there is a favorite that I just do not like, that I can give someone 3:2 on it, and root for it to lose. At least it's something new.

Will they operate their own exchange or simply make Betfair legal? If they try to operate their own you will find it will be very difficult to get enough liquidity for it to be worthwhile. The customer will find it nearly impossible to get on for any decent amount of money which will turn away all but the small players.

As a point of interest Betfair take a commission (starting at 5% and reducing as you bet more) on profit on a particular market. If you bet on more than one runner, get the winner but lose on the race overall you will pay nothing.

Quote: Canyonero

Hey,

in my quest for new ways to gamble, I am ready to cross sportsbetting off my list. For football, basketbal and such, the games take just too long for my taste. And in racing the commission (or whatever it is called) is just too damn high. Which brings me to my question:

Why is that so? Parimutuel betting would work just as fine just collecting a 5% commission off of each bet, for example. 14% , 17% , even 19% is just ridiculous. And the casinos could just offer this by themselves, why do they need these sportsbetting networks? At the end of the day, betting on horse 1, 2 or 3 is not that different from betting on numbers on a roulette wheel. (Parimutuel roulette, anyone?)

Morever, an affordable (low commission) parimutuel betting option would be very interesting for me as a gambler, as in some way it allows me to go up against other gamblers, not the house. And for the casino side it is completely risk free, they will collect their cut no matter what...

What am I missing? Thanks!

you cant play 1,2,3 vs 7,8,9 in horse racing like roulette BECAUSE Unlike roulette Horses dont have the same exact chance of winning.
If Cigar, Skip Away and Zenyatta were horses 1,2,3 and you gave me even money vs 3 non discript runners I'de quite my job before lunch time.

ALSO the speed at which betting events occur often allow for a lower take out....example in craps or black jack there is basically a new bet about every 45 to 90 seconds