Profitability is the holy grail of punting. It is what everyone strives for, yet struggles to achieve.

How are long term profits generated? Because a boost to your betting bank is the end result, but how did you get to that stage in the first place?

Here is a very simple yet powerful equation:

Profitability = Reality – Perception

So profitability is the difference between reality (what actually happens) and perception (what the market expects to happen).

Odds of $5 represent a 20% winning chance, which means the only way to achieve profitability at those odds is to win more than 20% of your bets.

Or you can look at it another way using a standard coin toss.

We know that in the long run a fair coin will come up 50% Heads and 50% Tails. But assume for a moment that the public perceived Heads as a better bet so it was priced at $1.90 and Tails was $2.10.

So the difference between the reality (Tails will win at 50%) and the perception (odds of $2.10 represents a 47.6% probability expectation) is the profitability.

The only way you can succeed as a punter is by finding pockets of value. You must identify whatever is undervalued by the betting market relative to its positive effect on performance.

The typical form factors that are widely published and understood are highly unlikely to be a source of consistent profits because their importance and influence is already ‘baked into the cake’. So being a last start winner, or drawing a ‘good’ barrier, or coming from a strong stable, or having the best winning strike-rate are (in isolation) not valid reasons to be backing a horse. You will back your fair share of winners, but you won’t be making any withdrawals from your bookie.

We have busted quite a few myths over the years and they can be a good starting point for further research in finding the pockets of value that produce profits. Just a few examples of under-rated (and therefore potentially profitable) factors to get you started:

If you do the same thing every Saturday then its only common sense that your results won’t change by anything other than variance. Some days you will enjoy random luck, but most months and certainly each year you will finish behind.

To achieve profitability it is essential that you:

  1. Go deeper and/or wider into the form to find under-rated factors
  2. Value value above all else
  3. Fall in love with a price rather than a horse
  4. Be comfortable opposing the market
  5. Appreciate that if you are consistently finding value the profits will follow

Good punting

David Duffield