Following the smart money isn’t so smart

Success in the punting game relies on getting value odds, so the hype about market movers on our racing coverage is amusing and misleading. If you think you can be a long-term winner just by following horses that have already substantially shortened in price, I can put you in touch with many bookies who will gladly take your bets. On a recent webinar our guest Paul Vincent from Luxbet explained it well and I’ll paraphrase: What happens is one or more of the super pro’s will rate a horse at $3.50 and happily take the $4 that’s available. Often they’ll keep backing it right down to $3.50, but by then that horse has momentum in the market, the smarties have backed it, others follow and some bookies will be looking to lay off. So it keeps firming, the public jump on and the horse gets right in to say $3. Of course that means they are now taking unders, because it was only value above $3.50. These ‘follow the market’ punters will back plenty of winners, but not enough to turn a profit. Fawkner last week was a perfect case in point. The horse was truckloaded from $2.80 into $1.80 in one of the biggest plunges of the year. But I don’t think there was a ratings or form analyst in the country who had that horse so short, yet it didn’t stop many punters taking red numbers. Another point to remember is that a lot of the bigger punters bet very early, very late, or drip feed. They’ll bet as soon as prices go up during the week if they spot what they consider to be a mistake in the market. Other times they will bet very late, literally seconds before the jump so as not to show their hand and also to bet into the market when the liquidity is at its highest so they can get set for more. Some also ‘drip feed’ their bets (particularly at Betfair and on the totes) because if they tried to get their entire wager on in one go it would alert and possibly distort the market. The ‘market mover’ has become a big deal on our racing coverage but very few punters realise that by announcing a market mover it actually serves the bookies own interests as well. That’s because this announcement attracts extra money on the totes for the highlighted horse and this reduces the bookies liability since the tote odds for that horse shorten and the bookies’ best tote related dividends for that horse are reduced. No matter what style of punter you are, the same rule applies and that is if you keep taking bottom odds you can’t win.