How To Trade a Tote

With racing in much of the world dominated by the totalisator, you need to understand how the flow of money works. Harness this knowledge and you can trade profitably on an exchange, using tote prices as a key indicator of punter sentiment.

UK racing on Betfair will have markets posted the night before as the British betting public expect fixed-odds markets – the market share for the tote in the UK is single-digits. In Asia, Australia, and the US, it’s the tote that holds most of the bets so most of the action is in the last ten minutes before post time. Likewise with exchanges – because there is no (or only a limited) fixed-price assessment available, punters wait until the pools stabilise before getting heavily involved.

You can use this to your advantage if you take a step-by-step approach. With totes working to 115-120%, there is a significant chunk of ‘fat’ built in, but when the pools are so low that a 5/1 shot can halve its odds with one $1000 wager, you can’t dive straight into the deep end! But if you get in early, you may be able to back or lay runners at prices a long way from their final dividend, so don’t shy away from early business. Being brave enough to go up first can deliver great returns!

Imagine your proposed heaviest liability on this race to be 5X. Ten minutes before the race, be prepared to lay any runner to lose 1X. American tracks all use a pre-post market called the Morning Line – a price service which assesses the race to a ridiculous margin (150-200%), much the same as newspaper markets in Australia. You can’t base too much on them as they are not set by anyone who risks real money on them. If you happen to have access to early prices from an online bookie, then you can be a little more confident in their prices.

So for your opening ‘call’, lay the field to 1/5 the size of your max liability, and set the book to a wide margin. If you are first in line, then you can set your book as wide as you like, but remember we are trying to generate some business, so don’t get too ambitious. The table below lists the Morning Line prices, the tote prices (and size of the pool), and suggested odds you try to lay on each runner. Be prepared for significant changes in the tote as the pool builds. A Morning Line favourite who is much higher on the tote will most likely shorten late. Likewise, if a 20/1 shot in the early markets opens at 2/1 on the tote, it will probably drift markedly – but there may be reasons for the changes (important scratchings, track downgrade, perceived bias etc) so stay on the ball.

Stage One

	ML			Tote			Exchange
							Lay At
Blacknwhiteflash	3 1/2	28.57%		6.5	15.38%		5	20.00%
Azaweri	8	12.50%		13	7.69%		11	9.09%
Tiger On Toe	12	8.33%		9	11.11%		11	9.09%
Money Down	10	10.00%		26	3.85%		16	6.25%
Backseat Driver	3	33.33%		4.7	21.28%		3.5	28.57%
Blazing Bureaucrat	15	6.67%		34	2.94%		30	3.33%
Sadlers Battler	8	12.50%		13	7.69%		10.5	9.52%
Lady Of The Down	10	10.00%		8	12.50%		10	10.00%
Via Veneto	8	12.50%		8.6	11.63%		8	12.50%
Italian Descent	5	20.00%		15	6.67%		7	14.29%
Berkshire	6	16.67%		9	11.11%		7.5	13.33%
Cryogenic Freezer	10	10.00%		24	4.17%		15	6.67%
		181.07%			116.02%			142.65%
					Hold 5000

If your fixed-odds comparisons are real prices, then their percentage will be much lower than the example, so you can be more confident with the prices you offer (which means lowering your market %). Important tip – to lay all runners to one amount (eg liability of 1X as mentioned above), click on that link when placing your bet offers (see the article on settings here). A box will pop-up where you can input the amount you wish to lay each runner for – saves you doing the calculations!

Stage Two

							Exchange
	ML			Tote			Lay At
Blacknwhiteflash	3 1/2	28.57%		5.5	18.18%		5.1	19.61%
Azaweri	8	12.50%		14	7.14%		13	7.69%
Tiger On Toe	12	8.33%		12	8.33%		15	6.67%
Money Down	10	10.00%		26	3.85%		23	4.35%
Backseat Driver	3	33.33%		5	20.00%		4.2	23.81%
Blazing Bureaucrat	15	6.67%		42	2.38%		40	2.50%
Sadlers Battler	8	12.50%		13	7.69%		12	8.33%
Lady Of The Down	10	10.00%		8.6	11.63%		10	10.00%
Via Veneto	8	12.50%		8.8	11.36%		9	11.11%
Italian Descent	5	20.00%		9	11.11%		8	12.50%
Berkshire	6	16.67%		10	10.00%		8.4	11.90%
Cryogenic Freezer	10	10.00%		23	4.35%		22	4.55%
		181.07%			116.03%			123.02%
					Hold 15000

As the tote pools grow and the prices vary, the exchange market will grow accordingly. Other punters will jump ahead of you with their prices and the market % will get tighter. Now start adjusting your prices in line with the other gauges you are using. Your liability can increase now as your confidence in the pools grows, but to avoid getting caught out heavily on one runner, your max liability should occur a few minutes out, and stay there only briefly. That gives you some time to lay others to try to balance your book. Getting hit in the last few seconds for your biggest payout leaves you with little option of trading out and can get a bit stressful if laying isn’t your normal strategy. As the market tightens in percentage, most runners will drift, so many times you’ll be able to bet your early lays back at better prices.

Stage Three

							Exchange
	ML			Tote			Lay At
Blacknwhiteflash	3 1/2	28.57%		4.9	20.41%		5	20.00%
Azaweri	8	12.50%		13	7.69%		13	7.69%
Tiger On Toe	12	8.33%		15	6.67%		18	5.56%
Money Down	10	10.00%		30	3.33%		28	3.57%
Backseat Driver	3	33.33%		5.5	18.18%		5.3	18.87%
Blazing Bureaucrat	15	6.67%		55	1.82%		50	2.00%
Sadlers Battler	8	12.50%		15	6.67%		14	7.14%
Lady Of The Down	10	10.00%		8	12.50%		9	11.11%
Via Veneto	8	12.50%		9	11.11%		9	11.11%
Italian Descent	5	20.00%		7.6	13.16%		7.2	13.89%
Berkshire	6	16.67%		9.2	10.87%		9	11.11%
Cryogenic Freezer	10	10.00%		28	3.57%		25	4.00%
		181.07%			115.98%			116.05%
					Hold 25000

Don’t go too crazy in your percentage tightening – it’s rare you will ever lay every runner to come out with the perfect book. Ask a satchel swinger on-course how many times a year that happens – they could probably count them all on one hand – if it happens at all without bet-backs. Most times you will be left with a few to cheer for, others that return a tiny profit or loss, and a few with varying liabilities. But leave yourself some room to move – if you are down to 105% book with five minutes left to trade, you have no room left to move!

There are other options you may wish to build into this system – backing runners you think are well over the odds, backing a plunge horse because it’s just been declared a ‘tote tumbler’ on the TV and its price will crash so you can lay it back a few minutes later, or simply using your opinion as well. If you’ve done your own research, then work out some minimum and maximum prices you’d be prepared to back or lay. If you’ve rated a horse at 6/4 and laid it at 4/1, you won’t be happy when it wins by three lengths!

Exchange betting offers the punter so much more variety and so many more options. Take the time to test out what works best for you. Use all the resources you can to find what makes you win more money!

Key Points in Summary:

1. The more price guides you have, the more confidently you can trade.
2. Don’t risk everything when the tote pools are low – build it up over time as they grow.
3. Leave some room to balance your books before the race starts – no time or no percentage to spare puts you in a potential panic situation.
4. Don’t be afraid to build your own opinion into your trading.

Scott Ferguson

This article is protected by international Copyright © Elk Publications Pty Ltd October 2004