# How Do We Know What A Horses Chance Of Winning Is?

Quite simply, we don’t! There is of course more to it than that. If that was all I was going to say then this would be a very short post. I was discussing the concept in today’s article with a friend recently and couldn’t get him to understand. There are profitable bettors who don’t understand this concept which shows that you don’t need to understand it to be profitable, but if you can understand it I promise that it will push you leaps and bounds ahead in your betting.

It is widely recognised that the odds just before the race begins are a very accurate representation of a horse’s chance of winning the race. We can test this theory by looking back at past races and seeing how often the 33% horses won and how often the 12% horses won etc…. and it does hold up that these odds provide an accurate.

I must add a little more to that sentence though for it to be entirely correct. ‘The odds just before a race begins are a very accurate representation of the horse’s chance of winning the race when looked at on average over the long-term.’

What does this mean? Let’s start at the beginning. There is only ever one correct odds line in a horse race. The winner has 100% chance of winning the race and every other horse has a 0% chance of winning the race. Think about that for a few moments and let it sink in.

When we create an odds line what we are doing is trying to find the average chance of a large group of horses winning over a large number of races. By this I mean that we take all horses who we have assigned a 30% chance of winning a race over the course of the year and ideally we want these horses to win an average of 30% of the time.

Let me try and explain it in a different way to make sure that it makes sense. If we want to create an accurate odds line for just one race, and we are never going to look at another race, then we have to give one horse 100% and all the others 0%. Obviously the horse we give 100% has to be the winner for our odds line to be accurate. If we decide that we are going to be betting on one race every day and over the course of the year we want our odds lines to be accurate we can now create a line that represents what you most likely recognise as an odds line. This is because over the course of the year we may give 50 horse’s odds of 5.00 or a 20% chance of winning the race. If from the 50 horses 10 of them win then we know that for this group of horses we have been giving them an accurate estimate of their chance of winning the race. It is quite a hard concept to explain and I hope that it makes sense, if it still doesn’t then add a comment and I will try and clear it up.

Now that we have this understanding what we need to make a profit is to create an accurate odds line that uses information in a different way to the public odds. We have already confirmed that the public odds just before the race represent an accurate estimate of a horse’s chance of winning in the long-term. The simplest way to create an odds line is in a 10 horse race we give all the runners a 10% chance of winning, in a 5 horse race all runners a 20% chance of winning etc…. You will find that if you look back over past data then an odds line created like this is as accurate as the public one. Can you make a profit from it? Of course not, any more than you can from the public one.

In order to make a profit you need to find information or a way of using the information available that is different to everyone else. You may already have a way that you do this or you can subscribe to the Race Advisor blog for some suggestions.

Let me take you through another example to demonstrate when you will be making a profit. If I have a group of horses that I bet on through the course of the year and they win 30% of the time then when the public put them at a lower chance of winning than 30% I know I have a value bet. If the public have put a horse that falls into my selection at 20% then does this mean that my probability is better than the public one? No it doesn’t, it means that it is different (neither of them are completely accurate because the accurate probability is 100% to the winner and 0% to the others). We know that the public ones are accurate in the long-term, we also know that ours are accurate in the long term. In the long term not all of my 30% horses will be 20% in the public line, some will be higher and some will be lower. Looking at the public odds as a person we will be choosing different horses to each other but when my 30% horse crosses with the public’s 20% then I can place a bet and take a long-term profit.

This is likely to be a bit confusing to start with but read through it a couple of times and feel free to get in touch if you have any questions.

I disagree that the correct probability line before a race is 100% on the winner and 0% elsewhere, simply because the information about the race unfolding doesn’t yet exist.

You wouldn’t say that the probability of flipping a head is 100% or 0% before it was actually flipped – it’s 50% until it is flipped, and as it goes through the air, the probabilities change one way and another until it finally settles.

Same with a race – a poor start or a stumble affects the win probability of each of the horses as the race unfolds.

The 100% line is only correct _after_ the race.

Colin you are right, the 100% line is correct at the end of the race and I agree that as the race is being run the probabilities change depending on what is happening during the race. What I have found is that a lot of people think that there is only one correct probability for a horse at the beginning of the race whereas there are lots of correct probabilities depending on how you are creating the line. If you can accurate line that uses different information to the public one then you are in a position to start obtaining value.

Ah! How do we assess a horse’s true chance of winning a race?

This is the big question to which there is no easy answer.

There are so many factors to consider before the race ( form, course, going etc.) and so many consequences in running ( interference, poor start, jumping errors etc.) and other factors that we punters cannot possibly know about (sudden improvement, trainer’s plans etc.)

But all is not lost because if it was a simple formula everyone would know and that would be that!

Because we can all formulate a different solution we can get an edge and obtain value when conditions are right for our individual assessment.

This requires hard work using ratings and other factors to create a comparison between horses that is represented by a numerical value or forecast price. If the actual price on offer is greater then over a series of bets a profit will be made.

It is all about probabilities, averages and long term results and each person who manages to produce a reliable system of analysis may well back different horses in the same races but still make a profit in the long term.

Sometimes it is best to keep things simple since the game is fraught with unexpected results which, after many hours of hard work, have you tearing your hair out!

I developed a simple approach for non-handicap races many years age using the good old Daily Mirror.

This involved giving points for three factors.

1) First four horses in the betting forecast (4,3,2,1)

2) SF, F or EW (3,2,1)

3) First three Spotform ratings (3,2,1)

Each horse will have a rating. Divide this by the total points to get the probability.

Example: If the horse was Forecast favourite, SF and Topspot the total score is 10 (4+3+3).

If the total points for the race is 20 the probability is 1/2 or 50%, an even money chance.

Should the price on offer be 2/1 then value is obtained since we will back on average, one winner from two.

A very simplistic approach but it illustrates the principle without delving too deeply into form and uses factors which have proven probabilities.

Thank you for this excellent post Roger, and for sharing your approach.