AUSTRALIAN PUNTERS' ASSOCIATION
ABN 23 649 310 363
35 Allambie Road, Allambie Heights, NSW 2100
Phone: (02) 9905 6470 Facsimile: (02) 9401 0632
Email: info@auspunters.com.au
**The Australian
Punters Association has brought to the attention of the Racing authorities what
they believe is an unfair situation when a horse is scratched at the barrier.**
**PRESS RELEASE**
**BOOKMAKER DEDUCTIONS - LATE SCRATCHINGS**
The Australian Punters' Association ("APA") today called for a revision
of the manner in which deductions for late scratchings are calculated.
Presently, the deduction schedule is based on an assumed bookmaker margin of
approximately 6%. As has been amply demonstrated on our website, bookmakers
do not offer anything approaching that margin, particularly at starting time.
Accordingly, the present method (6% assumption) means that bookmakers effectively
take profits from cancelled bets, with punters on the scratched horse(s) receiving
money-back, but remaining punters effectively paying bookies for the privilege
of not having bet on the scratched horse(s).
We are proposing a principle that the deduction for late scratchings be based
on P x (1+M), where P is the prevailing price and M the prevailing margin, at
time of scratching. Currently, the deduction assumes that the margin is approx.
6%, which very severely understates the true margin. For example the scratching
of an even money chance, leading to a deduction of just under 50c, would see
the bookmaker margin on what is currently a 20% margin race explode out to almost
40%!
The principle which we suggest is that the bookmaker margin be exactly the same
before the scratching as afterwards. This would be similar to a TAB - a TAB
takes almost exactly the same percentage pound of flesh from remaining punters
after a scratching as before.
If we take, for example, the average SP margins which applied to bookmakers'
offerings at Saturday class races in Adelaide, Brisbane, Melbourne and Sydney
for the 2004/5 season, these were:
Adelaide 33.01%
Brisbane 29.14%
Melbourne 20.91%
Sydney 14.96%
Comparing the current scheduled deductions over a range of prices would give
the following:
Proposed Deduction
Current on above margins
Odds Decimal Deduction Adel Brisb Melb Syd
1/2 $1.50 0.62 0.50 0.52 0.55 0.58
Evens $2.00 0.47 0.38 0.39 0.41 0.43
3/1 $4.00 0.23 0.19 0.19 0.21 0.22
6/1 $7.00 0.13 0.11 0.11 0.12 0.12
10/1 $11.00 0.08 0.07 0.07 0.08 0.08
20/1 $21.00 0.04 0.04 0.04 0.04 0.04
The current deduction schedules leads to the following post-scratching bookmaker
margins
Odds Decimal Adel Brisb Melb Syd
1/2 $1.50 74.6% 64.4% 42.7% 27.1%
Evens $2.00 56.6% 49.3% 33.8% 22.6%
3/1 $4.00 40.3% 35.2% 24.6% 16.8%
6/1 $7.00 36.5% 32.0% 22.6% 15.7%
10/1 $11.00 34.7% 30.5% 21.5% 15.1%
20/1 $21.00 33.6% 29.6% 21.0% 14.8%
which can be compared to pre-scratching margins as shown above. The APA's suggested
schedule would bring all post-scratching margins exactly in line with the pre-scratching
margins.
For the more technically minded, the algebra underlying the principle is attached,
it is a very straightforward alteration to the current calculation, and quite
easy to apply in practice, given that bookmaker margins are shown on the computer
screens on course.
For further information contact:
AIDRIAN O'DOMHNAILL 0411 680 408, or
DENIS MORONEY 03 9853 7318
Or email info@auspunters.com.au
**PROPOSED CHANGE IN BOOKIE DEDUCTIONS**
M0 = margin before scratching
Mc = margin after scratching, assuming deduction calculated as at present
Mp = margin after scratching, assuming deduction calculated under proposed method
Di = Dividend on horse i (before scratching)
S = Dividend on scratched horse
M0 = 1/D1 + 1/D2 + … + 1/Dn - 1
Assume deduction of 1/S
Then
Mc = 1/(D1*(1-1/S)) + 1/(D2*(1-1/S)) + … + 1/(Dn*(1-1/S)) - 1/(S*(1-1/S))
- 1
= (1+M0)/(1-1/S) - 1/(S*(1-1/S)) - 1
= (1/(1-1/S)) * (1 + M0 - 1/S - 1 + 1/S)
= M0/(1-1/S)
Mp = 1/(D1*(1-1/S*(1+M0))) + 1/(D2*(1-1/S*(1+M0))) + …..
+ 1/(Dn*(1-1/S*(1+M0))) - 1/(S*(1-1/S*(1+M0))) -1
= (1+M0)/(1-1/S*(1+M0)) - 1/(S*(1-1/S*(1+M0))) - 1
= S* (1+M0)2/(S*(1+M0)-1) - S*(1+M0)/(S*(S*(1+M0)-1)) - 1
= [S2*(1+M0)2 - S*(1+M0) - S*(S*(1+M0)-1)] / (S*(S*(1+M0)-1))
Taking the item in square brackets
= S2 + 2*M0*S2 + M02*S2 - S - M0*S - S2 - M0*S2 + S
= S2*(M0+M02) - M0*S
= M0*((S2*(1+M0) - S)
= M0*S*(S*(1+M0) - 1))
Canceling out the S*(S*(1+M0) - 1)
Mp = M0
Then the difference between post-scratching margins
Mp - Mc = M0 - M0/(1-1/S)
= -M0/(S-1)
This makes intuitive sense. The bigger the pre-scratching margin the greater
the reduction and the bigger the price the lower the reduction. |