We’ve all been there. Our great horse racing system has started to lose. The big question is…
Is it a downswing or has the system stopped working?
Everything pivots on making the right decision here. If you decide it’s broken and stop using it, but it was just a downswing, then you’ve binned a profitable horse racing system. But if you decide it’s a downswing and the horse racing system has broken, then you’re going to be throwing good money after bad.
How do you know which is right?
I’m gong to show you some of the ways that you can be confident you’re making the right decision in the rest of this post.
HORSE RACING SYSTEM ACTION PLAN #1
Before you start using your system, you should have a plan of what to do if it starts losing, how you’re going to determine whether it’s a downswing or not, and at what point you’ll stop betting on it.
Almost no bettors do this. Whilst you may be aware that it’s not going to work forever, most of us bet on the selections found by our horse racing systems without ever considering what it will look like when it stops working, and how we prevent ourselves from losing your hard earned profits.
As in a lot of things, we behave differently in this aspect of risk management when it comes to sports betting than we do in any other areas of investment.
But I’m going to ask you to stop.
I’m going to ask you to make sure that you have a plan in place for what happens when your horse racing system stops working. How you’re going to determine it’s stopped working, and at want point you’ll stop betting on it.
Heck, I’m not just going to ask you to create the plan, I’m going to give you one. And it’s pretty damn easy. So let’s move on to step action plan #2.
HORSE RACING SYSTEM ACTION PLAN #2
You shouldn’t just bin your horse racing system. Not even if the results have dropped through the floor.
Because it could just be a downswing!
With all the hard work and time you’ve spent building your horse racing system shouldn’t be binned unless you’re 100% certain it’s no longer working.
And even then it shouldn’t be binned, because the chances are a few tweaks will bring it back to profitability.
But I’m getting ahead of myself… first of all we need to determine if it’s a downswing or if it’s not working.
In order to do this I’m going to share with you the single easiest way to check this.
- Are you winning more bets than the SP would suggest you should be?
Assuming that you’re keeping records of your bets, which of course you’re doing aren’t you ?, then you’ll have the odds you took, the SP and maybe even the Betfair SP.
For this particular calculation we’re going to be using the SP.
Taking the SP for each horse, work out the probability of that horse winning the race by doing this sum:
1 ÷ Decimal SP = Probability
If we take 6.75 as an example:
1 ÷ 6.75 = 0.1481
You can then multiply this by 100 to get a percentage figure. Which means this horse would have had a 14.81% chance of winning the race.
However, we don’t want to multiply by 100, we want the probability figure which is the decimal one. Because if you do this for every horse, and add up all these probabilities you get the expected number of winners based on the SP odds.
Now you can compare this directly with the number of actual winners you’ve had.
For example, if the SP probabilities indicated you should have had 75 winners, but you’ve had 100, that’s a good thing.
If you have had more winners than the SP probabilities indicate, then you’re beating SP, which means it’s very likely that you’re in a downswing.
If you’ve had less winners than the SP probabilities indicate, then it’s possible that your horse racing system is no longer working.
But there’s an important element…
There have to be a decent number of selections. Doing this over ten selections isn’t going to mean anything. Ideally you want to do this over at least 100 selections, but if that’s too many, try and make sure you do it over the biggest number possible. The bigger the number, the more reliable the result.
What about if you have the same number of winners as the SP probabilities would indicate?
In this situation, you should consider that there’s still a problem you need to look into, as opposed to a downswing.
HORSE RACING SYSTEM ACTION PLAN #3
Don’t bin your system.
I know I’ve already said it, but I’m going to say it again because that’s the most common thing to want to do.
But you’re a long way from that.
First of all you need to determine how bad the situation is. if you’re near the number of winners the SP probabilities indicate, then you want to paper trade the selections for a bit longer, and continue to monitor the situation.
You are waiting for it to either come back into profitability and for you to be finding more winners than the SP would suggest, or you’re waiting for it to get worse where you can definitely say it’s no longer working.
If it gets better, then once it’s make a profit again, and the number of winners are higher than the SP probabilities indicate, then move it back into your live portfolio and start using it again.
If it gets worse, then stop paper trading and put it back into development.
And it’s when we put a horse racing system back into development that we need to use step four.
HORSE RACING SYSTEM ACTION PLAN #4
We only need to use this step when we are moving one of our horse racing systems back into development.
Usually a horse racing system that’s been working well, will only stop working because of a small change. Something will have changed that either means:
- A piece of information has become more widely available
- Something has changed within the races
Once we realise that 99% of the reason for a working horse racing system to fail is one of these two items, suddenly the task of trying to fix it, rather than start again, seems much more appealing.
I like to start with number one first, which is why I put them in that order.
The reason being, it’s pretty quick and easy to find out whether a piece of information that wasn’t widely available, has become widely available. Here’s how:
- Check out the Racing Post, At The Races, Sporting Life and Timeform race cards for any new features or anything highlighted
Looking for information that may have been highlighted is very important, sometimes information gets highlighted as part of an ongoing promotion that will draw bettors attention towards something which may otherwise have gone largely un-noticed.
When you find something like this, all you need to do is to wait for the highlighting of it to pass. Once it has you should start to see your edge coming back.
If you find that one of the above sites are now publishing a piece of information, that they weren’t previously, which means a key component of your horse racing system is now widely available, you’ll probably need to put it back into development. There’s nothing you can do about it, it doesn’t often happen, but when it does we just need to see if we can find the edge somewhere else.
The times when you don’t find anything at all, you need to move to step two, and look to see if something has changed in the races.
Your first point of call should be the recent news from the BHA.
Go back through their stories for the last few weeks, or months, and see if anything has been introduced that may have affected your horse racing system.
If you draw a blank, then I like to break down the results by course and perform the same winners vs SP probability winners calculation. Often we’ll find that the issue is only occurring at one or two courses.
When you have these courses, you can then look to see what has happened at them. Have they changed the position of the rails, have they changed the track layouts, are they doing some kind of work. Finding anything like this is excellent, as it means you can re-evaluate your horse racing system for those courses, or just strip them out of the selection process entirely.
Only strip them out of the selection process if you can find a valid reason for your horse racing system to have stopped working at them. If you can’t then don’t remove them, because you will almost certainly see the same issue again very quickly.
The times when nothing can be found, unfortunately we have to go back to the development room.
I like to give myself a set timeframe on how long I am going to spend to see if I can re-work the betting system. Usually this is around 20% to 25% of the time it takes me to build a new one.
If it takes you a month to build a profitable betting system, then I’d put in around a week’s work to see if I can re-develop a failed horse racing system into a profitable one. At this point, the time-cost-benefit starts to weight towards making a new one.
You will have your own preference about how much time you’re prepared to spend re-developing your horse racing systems. But I would . urge you to not simply bin it and start again. A lot of the time a few hours spent can result in the system working again, and that’s always going to be much easier than building a new one from scratch!
What To Do Next…
Now you have an action plan you can put into place if your horse racing systems stops working. And it’s one you should pin to your board before you ever start using a new system. That way you’re not taken by surprise, and you know exactly what you’re going to do.
Have you ever considered putting an action plan in place for when your horse racing systems stop working?
Let me know by leaving a comment below, or if you’ve got any questions on the maths please do ask in the comments section.