Educating Trevor: Shopping for Value

As a retired gentleman Trevor likes a bet; in fact I first met him in a Bookmakers shop around ten years ago, writes Mark Littlewood (@SmarterSig). He wasn’t a profitable punter but his daily walk into town for a bet, some banter and a cup of tea was a regular ritual. Trevor has one quality however that bookmakers do not like, he has a brain in his head. He demonstrated this by expressing to me an interest in becoming more successful with his betting.

How many punters have you met who seem to want to validate their own failure rather than improve their own betting? Trevor was not one of them and he was about to take his first steps towards profit.

He first asked me what the single most important thing was he could do to improve his bottom line, how could he at least perhaps break even and maybe even win long term. I asked him how he bets, what is his daily routine.

It is a familiar one to us all. He makes his picks around 8am, has some breakfast and then strolls into town around 10am to his favourite bookmaker which at the time happened to be Paddy Power. It sometimes changes, if the manager makes him unhappy for some reason. He will then switch to Ladbrokes, Coral, Fred or Hills. If there is one thing FOBTs have given punters it is more shops to choose from, but it is probably the only thing. Trevor will write out his bet taking the odds the bookmaker is currently offering at around 10.30am.

So what can Trevor do that will improve his bottom line. Study more form?  Follow a tipster? Invest in some fancy speed figures and follow them? My first line of advice was none of these. What all punters should do to improve their betting is to take the best price available.

I suggested that Trevor checked which bookmaker has the best odds amongst his bookmakers and make the effort to grab those prices.  If he could include online bookmakers then his prospects would be even better.

Trevor managed to do this (although not via online books) and admitted that he felt better off financially. The second thing I got Trevor to do was check out Betfair and once again Trevor was not only open to this idea but came back to me amazed at some of the prices he was getting.

Okay, so far this is all anecdotal although I can assure you perfectly true.  The real question is how much better off is Trevor and could he do even better with his bet placement choices? To test this I gathered 10:05 am prices for all High Street and online bookmakers for a period of just over two weeks starting around the St Leger meeting. I wanted to see how better or worse off the profit would be with various bet placement strategies. First of all I wanted a baseline to compare to. I decided on profit and loss to bookmaker SP on all horse who had a 10:05am average price of less than decimal 10.0 (9/1). To keep things simple I only considered races where, from 10:05am onwards, there were no non runners up to race off time. Both Flat and NH were analysed. 

AM av’g Price < 10 in betting to bookmakers’ SP £1 bets

Bets                                 PL                    Returns to £1

From the above we can see that during this period if we had 1236 £1 bets we would have lost £87.35 which equates on average to getting 93p back for every pound bet. What we would really like to see from a betting strategy is that last column to be above £1.00; the purpose of this article is to see which method of bet placement moves us closer to £1.00 when betting blindly.

So how can we improve matters before we even consider how we are picking our bets? Well what if we do what Trevor is now doing. What if we bet at best 10:05am prices rather than bookmakers’ SP. The first question is, which bookmakers should we realistically consider? Trevor is not going to have accounts with every available checkable bookmaker.  Perhaps a look first at betting to best price at 10:05am with the main High Street shops, namely Ladbrokes, Coral, Hills, Fred and Power.

AM av’g price < 10 in betting to best 10:05am price with main high street firms

Bets                                 PL                    Returns to £1

Excellent, a small improvement: a loss of £77.71 which equates to a return on every pound of 94p.

However what if Trevor is willing to really do the leg work and open accounts with all online Bookmakers? For these results I have excluded all exchanges except Betfair exchange and Betfair Sportsbook.

AM av’g price < 10 in betting to best 10:05am price with all firms

Bets                                 PL                    Returns to £1

It is worth noting that we will need larger samples than this to feel confident about whether that £0.97 is a realistic figure but what we are really interested in at this stage is the relative behaviour of these numbers. Is one strategy is better than another and, if so, by how much?

Let us be a little more realistic. Trevor may not want to have over a dozen online accounts. Perhaps he is only prepared to open two or three. The question now becomes one of which two or three bookmakers should he open online accounts with. A count of how often each bookmaker is top priced or joint top priced on a race should tell Trevor where to have his two or three accounts. The chart below shows this count for the period under examination.

The above chart suggests Trevor should have accounts with BetVictor, Betfair and Bet365 in addition to his high street shops

Let us now take a look at how Trevor would have performed if he took the easy option and simply placed all the bets at Betfair SP. This can be done with a single click in the morning and then the rest of the day is his.

AM av’g < 10 in betting to Betfair SP after 5% commission deducted

Bets                                 PL                    Returns to £1

Betting all horses with a 10:05am average price less than 10.0 in the betting at Betfair SP produced a negligible loss of £7.13, which equates to a return of £0.99 for every pound invested. Once again I emphasise that this small loss is unlikely to uphold but the difference in performance from the other approaches is what we are interested in and there appears to be a clear disparity.

Furthermore, any regular punter on Betfair will not be paying the full 5% commission.

Many people will be surprised to find that the easy Betfair SP option outperformed all the other scenarios. Moreover, there is no chance of you getting your account restricted or closed betting to Betfair or Betfair SP. Seems that the old adage of "don’t work hard, work smart", applies to your betting as well.

Finally are there any bookmaker-based betting approaches that can beat Betfair SP? Well, so far there is one but it would rely on getting Best Odds Guaranteed (BOG) with any of the High Street Bookmakers at 10:05am. Where BOG is offered on a race you can take a price and if the SP is bigger your bet will be settled at the bigger price. There are some challenges with this as various time caveats come into play when offering BOG; and, more materially of course, it is the first thing to go when you show any sign of intelligent punting. Still, the results are solid for as long as one can sustain them.

Av’g price < 10 in betting to best high street only and BOG at 10:05am

Bets                                 PL                    Returns to £1

If you are not a long term winning punter then these figures suggest that when and how you bet can make a major impact on your loss figures.

What if you are a winning punter? Unless the current bookmaker climate changes you may well be forced onto Betfair anyway, but in the meantime I would advocate placing small breadcrumb bets on Betfair alongside your normal bets to gauge the difference in overall performance.

If there is interest in this article I will follow it up with a look at whether the intelligence of the market or wisdom of the crowds can be harnessed to produce a profit.

- Mark Littlewood

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