What is a Good Profit From Horse Racing Handicapping Or a Reasonable ROI?

Many people ask, “How much money can I make betting on horse races?” While many people struggle to make a profit from horse racing handicapping and betting on horse races, few people have a realistic idea of what can be expected and how much profit can really be achieved. Horse players often talk about R.O.I. or return on investment (ROI). Simply put, it is the percentage of return above your initial investment. So if you spend $100 on a win bet and get back $125 your ROI is 25%.

So how do you know what a good ROI is and what you can expect? First of all, when comparing investments, you must look at competing investments and also take into account the amount of risk and work involved. Handicapping horse races is time consuming and therefore, you must pay yourself for the time you spend handicapping. You can pay a professional such as myself, to do some of the handicapping, which means you’ll have to spend less of your own time, but in the end, you’ll still have to spend some time researching and putting some thought into how you bet.

If you buy stocks or make any other investment, you have to do some research as well. You may have a broker who makes recommendations or a financial planner or analyst, but in the end, just as with the people who pay me to handicap races for them, the ultimate decision will rest with the investor. Many stock investors now consider 10% as a reasonable return on their portfolio.

How much you can make on horses will vary from week to week, but your yearly average may be better than the stock return, but also much riskier. When it comes to horse handicappers, even the pros have their ups and downs and you have to look at the long haul to get an accurate idea of what is reasonable. For instance, the weekend of June 11th (I work in three day weekend blocks and send a newsletter with the information for each three day block) my key horses made a profit of over 80% ROI. That is very high, but the next week the profit on the same kinds of bets was way down.

In the most recent weekend, June 25th 2010 to June 27th, 2010, my top picks made a flat bet profit on win bets for thoroughbred bettors of 22% ROI, while bettors who played my top picks in harness races on half mile and 5/8’s mile tracks received 11% ROI. There are no guarantees in betting on horse races and it would be reckless of me to guarantee a profit or to try to predict how much profit to expect because of the volatility of the market.

Overall, however, it is safe to say that at times horse racing bettors may see a higher rate of return than bettors in other markets, but they pay for that possibility with a much higher risk.

How to Profit From Sports Gambling

The goal for sports punters is to earn a profit whilst enjoying our favourite sport. The sad truth is that for the majority of gamblers, this is an elusive dream. However by developing and carefully following a stratagem anyone can make this dream a reality.

There are two factors to consider to profit from sports gambling:

  • Bet Selection
  • Staking Plan

Bet Selection

The first, Bet Selection, is obvious – we need to back winners at least some of the time. Let’s consider Horse Racing, anecdotally there are many professional punters who earn a comfortable living from picking horses, but the key word here is professional. Research and analysis of each horse in the 59 racecourses across the UK takes a sizeable amount of time and experience. If you want to be successful then it’s a full time job! For the majority of us this means we have to use the advice of experts to do some of the legwork for us.

Horse Racing Tipsters

UK horse racing has no end of self-proclaimed “experts” on the Internet charging up to £100 per month. When selecting a horse racing tipster the most important factor we need to consider is long term results.

The Internet is awash with tipsters who have had one good month but then go on to post a loss for the next six – but you will only see this one month on their home page! Never follow any tips without first checking the tipster’s full result history. Choose a tipster who publishes all their horse racing tips history, ideally where the results of the tips are published the next day along with a complete history of all their tips.

Take a look at a Tipster Proofing site such as Racing-Index who grades the results for a number of tipsters. Consider which tipster gives you gave for money and fits with your own betting profile – can you actually place the 100s of tips each month some tipsters require?

Following tipsters alone is not likely to earn us riches – the best tipsters are locked out for new members or charge such high rates that any profits are lost immediately. The solution is to develop our own system using tips from expert sources combined with our own research. This is the strategy successfully used in greyhound racing by followers of the site. As with most things; the more you put into your system the more you will get out.

Staking Plan

Once we have a betting strategy in place it is time to look at a staking plan. The simplest is Fixed or Level Stakes where we simply bet the same amount, for instance 2% of our initial betting bank, each time on our selected horse, however we would want to increase our wagers as our betting bank grows. This leads to Percentage Staking where a percentage of the current betting bank is wagered each time. This means as we win our stakes are larger and conversely the stakes shrink when the betting bank decreases.

However, intuitively we know these staking plans to be overly naive as we would be putting the same amount of money on a horse with low odds compared to a horse with high odds. As we are looking to maximise our profits we should be putting a larger stake on a low odds bet as the return will be less.

To find the optimal staking plan we could take a correspondence course in statistics and dedicate several years into research. Fortunately we live in age where this research is at our fingertips. From probability theory we have the Kelly Strategy where the optimal percentage of our betting bank is calculated from the odds of the bet and our own estimate of the probability of the horse winning.

Using an online Kelly Strategy Calculator just feed in the values to get the percentage of the betting bank to put on each horse. Now the Kelly Strategy can give us some scary percentage stakes if we have an initial run of high odds horses so we could adapt it to a Half Kelly Staking Plan where we wager half the percentage advised by the Kelly Strategy. This would result in a slower accumulation of gambling profits but a less hair-raising ride.

The most important sports gambling advice to heed is only bet with funds you can afford to lose. Always gamble responsibly – if you feel you need help and advice with problem gambling visit http://www.gambleaware.co.uk.