Can You Make Money Chasing Favourites?
Hi, Malcolm here! Today, I want to dive into the age-old saying: "You can't make money chasing favourites." But is that really true?
Let's explore this concept and see how we can leverage this information to potentially profit in the markets.
Understanding Strike Rate
The Strike Rate is considered to be the chance of a particular horse winning the race. There is a simple calculation you can do to quickly determine the chance of a horse winning based on its current market price.
I should clarify that and say “That the market thinks it’s chance of winning is”.
If we see the price of a Favourite say at 2.00 we simply divide one by two.
1 / 2 = 50 or 50% or 1 / 3.45 = 30%
This gives you a quick way of determining the chances the market things the horse has of winning
Understanding Favourites
First, let’s clarify what we mean by “favourites.” We’re looking specifically at BSP (Betfair Starting Price) favorites, which are generally considered the most accurate.
Over the past year, we analyzed data from 12322 races, showing a strike rate of about 33.52% for favorites. This means if you’re laying a favorite (betting against it), you have a 66.42% chance of winning.
However, backing favorites isn’t as profitable. In fact, the data indicates a loss of 541.91 points across all races with no specific race type being consistently profitable. So, the idea that you can't make money by following all favorites holds true to some extent—but there’s more to it.
Looking at Price Ranges
Now, let’s get a bit more specific. What if we focus on favorites with a price of 2.5 or under? Analyzing this subset, we find a strike rate of 52%, which is almost like rolling a dice—there’s roughly a 50-50 chance of winning or losing. While this may seem better, the data still shows a loss of 82.66 points.
So, how can we use this?
Knowing that favourites have around a 50% chance of winning when their price is below 25, we can start strategizing differently.
For example, we can consider laying second favourites in races where the main favourite is particularly strong. This approach lets us make informed decisions rather than blindly following all favourites.
Digging Deeper into the Data
Interestingly, some race types have shown occasional profitability, such as "Chase" races which returned a modest profit of 9.72 points over the last year. However, this isn't consistent over time. If you analyze multiple years, the profit margins often disappear. This shows how market dynamics can change, and what worked in the past might not always work in the future.
Now let's look at favourites trading below a price of 2.00.
We are now talking about very strong favourites and ones we would expect to have a very good chance of winning. The stats show that favourites with a price under 2.00 actually have a 60.91% of winning.
For those looking to refine their strategies further, we can also consider other variables like the performance of horses in their last race, age, and specific race conditions. For instance, horses that finished first in their previous race have a strike rate of about 76%, though not necessarily with a profitable outcome.
What good is this information?
There are two ways of using this information.
The first it to look at the strike rate and then decide if the favourite really does have a good chance of winning and if it does then take it on.
Or again if we feel the favourite does have a good chance of winning then “Lay” one of the other runners in the race.
If the Favourite is between 1.10 and 1.99 then second favourite only wins 20% of the time (Between the price of 2.50 and 10.00) which means if you “Lay” the second favourite then you have an 80% chance of winning.
Just because the favourite loses, it doesn’t necessarily mean the second favourite will either.
Some more stats on favourites.
I am going to use the TTS+ “Quick Anlayse” buttons to give you some more facts about favourites.
This doesn’t mean they can be profitable but having more informations is always handy.
These are the LTO (Last time out) stats (-2 not run before -1 didn’t finish).
So I was intrigued a little by the 2nd last time out so changed the table to “Lay”.
As you can see laying favourites that were 2nd LTO did produce a profit over the last year.
The other interesting stat was that 9 th LTO from the back table making 14.91 points let us see what that looks like in the TTS+ result sheet.
That’s a year of results so it probably doesn’t seem worth thinking about it for most people but interesting all the same.
Let’s see what else we can find.
This is the number of wins the horse has had.
Let’s look at that from a “lay” point of view.
The one I find interesting here is Favourites without any wins.
This is what the results look like when “Laying” them on Chase or Hurdle races.
The last one we will look at is the Age table.
Now let's look at it from a “Lay” point of view.
Ages 2 and 3 could be noted as something to explore because there are plenty of selections to use filters against.
As an example, this is ages 2 and 3 on AW only which represents 50 points profit.
In conclusion.
To wrap it up I think the saying “You can not make a profit following favourites” is a bit too simple. It should be “You can not make a profit following favourites blindly and at any price.”
Horse racing has a lot of ways you can take advantage of the markets but you really need a tool like TTS+ to make it simple to find them
https://www.cashouttrading.com/dobsoft.asp
