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How to calculate the payoff on a win bet in horse racing?
Calculating the payoff on a win bet in horse racing is easy once you get the hang of it. The odds of a horse winning a race are expressed in two numbers, which tell you at a glance both whether it is seen as a favorite or a long shot and what your reward would be if you bet on it.
This is an example of how you calculate horse racing bettting payoff
As an example, let’s consider a horse named Runs All Day, who is listed at odds of 8-1. The odds are telling you that a win bet will return eight times the amount you wager, plus the amount of your original bet. So if you have a $2 win bet on Runs All Day and he finishes first, you can expect to collect around $18 – 8 x $2=16, plus your original $2 bet.
Odds on shorter-priced horses are often broken down further to better reflect the pari-mutuel odds.
So if listed at 5-2 that is telling you that the payoff will be 2 ½ to 1. So a $5 win bet would return approximately $17.50 – 2.5 x $5=$12.50, plus your original $5 bet.
In the case of heavy favorites, the odds can be less than even money. So if Champs Champ is listed at odds of 4-5, you can expect to receive a payoff of about $3.60 on a $2 bet – 4/5ths of $2=$1.60, plus your original $2 bet.
The actual payoff may be slightly higher than your calculated price because of what’s known as “breakage,” the practice of rounding down the actual payoffs to the nearest 10- or 20-cent increment. For example, the true odds of Out of My Way, who is listed on the Tote as 5-2, may actually be 2.92-to-1. In that case, the payoff would be rounded down to 2.90 or 2.80. In the latter instance, rather than the $17.50 you collected on Faster Than You in the example above, you would get $19.00 – 2.8 x $5=$14, plus your original $5 wager.
It’s not possible to calculate the exact place and show payoffs ahead of time, as those prices are derived from separate pools and can vary depending on whether favorites or long shots dominate a race. But a general rule of thumb is that the place price will likely pay about one-half the win price, while the show will be about one-third.
It’s worth checking for anomalies in the place and show pools, however. Look for situations where the betting in those pools does not reflect the win betting, in which case you could get an inflated payoff.