Please note that this article
was written in 1998, so the phone numbers are no longer valid.
Readers would be aware of
our Winform Winners service. The question most often asked by new members of
the service is this. "Am I better off betting with bookmakers or the TAB?" and
it’s a good question.
Recently I aired this proposition
on the Internet through the ausrace discussion group. One member of that group
in particular was certain that when comparing prices on horses that were under
say 4/1 that the bookmakers prices would be superior. As this falls in the average
price range of Winform Winner selections, I thought we would look at the total
dividend returned by both methods for the past two months.
Here’s the result. TAB DIVIDENDS
$202. Bookmakers Starting Price dividends $201.60. Isn't that amazing! Now why
is this. To investigate further let’s look at a typical non-metropolitan midweek
meeting at Broadmeadow.
It is a freezing cold day
with a heavy track and lots of scratchings and a hastily altered track layout
to ensure the meeting could go ahead. In the bars it is cosy and there are plenty
of seats. In the betting ring there are probably no more than a few dozen punters
watching the bookies boards of maybe four or five bookmakers.
By law the TAB takes out about
14.5% of the betting pool before returning the rest to winning punters. After
dividends are rounded down the take averages a total market percentage of 117.5%
. (It is not the purpose of this article to explain market percentages, simply
to make comparisons. That article may be available another day)
On one particular race with
seven starters the bookmakers had a 6/4 favourite, two other horses at 5/2,
one at 11.4 and the others at longer odds. The betting steward takes the average
price of the bookmakers and enters the odds electronically. The total of these
odds comes to over 145%.
Is it any surprise to see
that the favourite pays $3.30 on the TAB but was never better than 6/4 with
The story is repeated at the
"away" meeting at Echucha in Victoria, but in reverse, well sort of. A 9/4 favourite
paid only $2.50 on our TAB. The difference is 80 cents the other way.
At Broadmeadow the punters
who backed the winner at short odds with bookmakers wanted to get set at fixed
odds. The problem with the TAB is that the more money you put on the less you
end up with as a series of big bets will affect your own odds. When bookmakers
have to accept large bets on a "goer" they realise that the other members of
the betting public are not going to be able to bet enough to allow them to balance
their books and this is why their books are set "over round". The TAB never
loses. It can’t . The percentages are always fixed in their favour. Individually
the bookmaker can and quite often does , lose. This is why they are often less
likely to take the risk of offering better odds.
A character who goes by the
non de plume of "Gunsynd" feels that the situation is different on Saturdays,
our main betting day in Australia. I disagree. The market is set differently
of a Saturday as there is a far bigger market. But there is also a much larger
"army" of weekend warriors who devote a great chunk of their time in finding
the winners. When you add to this the weight of opinion unleashed over the radio
by the "experts", you will often find that a horse is severely under the odds
when bookmaker betting opens.
The bookmaker can see this
heavy support and most times will offer only a slightly better price than the
TAB boards are showing. The oncourse "heavies" may well refuse to bet and this
causes both the bookmakers price and the TAB price to ease, although the TAB
price never catches up in this situation.
The end result it that the
bookmaker’s price may be better a lot of the time. It sometimes catches up in
other price brackets. Last weekend for example. Prime Address wins narrowly
at 13/2 ($7.50) the TAB price is only $7.1o. In other states the dividend is
as high as $8.60.
Most bookmakers offer Starting
Price plus 5%. On our figures as stated previously, the 201.6 return becomes
211 (near enough) which is now significantly better than the $202 return from
the TAB. In most states you can legally place a bet with bookmakers before the
race meeting starts, for any amount of money (each bookmaker has his own rules
here) instead of the midweek $100 minimum or weekend $200 minimum demanded by
State law for on course phone bets.
This is not the end of the
story, though. Bookmakers are continuing to bet worse and worse odds. The end
may well be coming, and quicker than we think. The inability of the individual
to finance the liability that today’s betting trends demands has led to the
mooted introduction of fixed odds betting by the TAB. This has started in the
shape of Sports betting. The TAB has virtually unlimited resources compared
to the individual bookmaker and it may now be time to allow bookmaking partnerships
or companies to form for the good of competition.
Your comments are welcome.
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