place odds

[thevig]

Why are the place odds 1/4 of the win odds when you bet each way? I think this cannot be exactly correct, based on the win price. Any thoughts appreciated.

[becareful]

thevig,

The 1/4 of win odds is definitely not perfect but in many cases it is quite a good approximation of the place odds. A few examples might help to illustrate it:

Assume you have a 10 horse race with all horses having an equal chance. With no bookie margin the odds on each horse would be $10 or 9/1 - if you put a $1 on each horse then you would spend $10 and whichever horse won you would get back $10. The place odds for each way would be 9/4 or $3.25 so again betting $1 on each one you would get back $9.75.

If you look at 8 horse race with same scenario then win odds are 7/1 ($8) and place 7/4 (2.75) so you would get back $8.25 for your $8 place bet.

With 17 horse race odds are 16/1 ($17) and 4/1 ($5) so in this case you only get back $15 from your $17 place bet.

You can see, therefore, that the 1/4 odds gives a good approximation but it is biased in favour of punter with 8 horse race and in favour of bookie with 10 or more horses. Also in real life you have the bookie margin and also the various different odds which confuse things (short priced horses, particularly odds-on, can create a situation favourable for the punter). This is why bookies will often not offer each-way on small fields, especially if there is an odds-on favourite.

<font size=-1>[ This Message was edited by: becareful on 2002-07-20 12:19 ]</font>