There
is a little wrinkle in the process of creating an odds line that is
probably too complicated to include in any preliminary discussion, such
as the first articles in this series, so it was just mentioned there
in passing. When I make an odds line by hand, probably more often than
not, the percentage given to each horse does not actually represent
that horse’s probability of __winning__ the race. In a high uncertainty
race, sometimes the odds on the first four or five horses—or even all
the horses—may be estimated “Win” probabilities. Just as often, however,
only two or three horses may be Win probabilities, a few others may
be in-the-money probabilities, and still others are “not-in-this-lifetime”
camels.

This
discussion can get arcane in a hurry if you start thinking about probabilities
and dealing with them mathematically, with the idea of computerizing
it (as I did a while back). Without going to the numbers here, if you
work with them a while (for that matter, if you just watch races for
a while), you will probably come to the conclusion that in most races
there are Win Contenders, Money Contenders, and Non-Contenders. While
anything can happen in a race, Win Contenders and Money Contenders are
not necessarily the same set of horses. Sometimes they are almost separate
“sets.”

Remember
“set” theory? Most everyone remembers drawing those overlapping circles
in high school, even if we don’t remember what the heck they were for.
You may also remember Ballentine Beer, with the logo of three, slightly
interlocking rings, like a cloverleaf, which Army drill sergeants used
to give out to good shots, but I digress…at any rate, the Ballentine
logo is one representation of a “three-lobed set” and that’s the image
here. If all horses were Win Contenders, there would only be one circle,
and all their probabilities of winning would comprise it. Or, if all
horses were __either__ Win Contenders __or__ Money Contenders,
there would be two circles interlocking to varying degrees, like the
way they portray looking through binoculars on a movie screen. But,
there is the __third__ case of Non-Contenders, so it’s a “tri-lobular
set”—like binoculars after a few too many Ballentines.

The
fact that these three circles interlock, Ballentine fashion, shows that
certain members are shared. __The interlocking area represents the
uncertainty of racing__—__and of handicapping__. Can one of your
mortal-lock-Non-Contenders jump out of its circle of discarded horses
and Win—or pop into the Money circle to Place or Show? Mine can. Can
one of your Win Contenders lose? The fact that the word “Contenders”
is plural guarantees it. These interlocking areas of the sets represent
those horses that share these crossover possibilities. Now picture
these circles changing in size, and the degree to which they interlock,
depending upon the nature of the race, the capabilities of the horses,
jockeys, trainers, etc.—but, most of all, your own handicapping. This
is a little out-there, but if you wanted, you could view handicapping
as the task of reducing the overlap between those three circles—Win
Contenders, Money Contenders, Non-Contenders. If you could get those
three bubbles floating separately for a race every now and then—and
__know__ it—you’d be one rich dude, Dude.

“High uncertainty” races are those in which the three circles move together
and, occasionally, they may form one sphere. Remember the mid-summer
race at Churchill Downs, where the combined stud fees of the ten horses
in the gate could cancel the national debt for certain third-world nations?
That race might be represented by a sphere—some horses may be more likely
to win on a particular day, but when it gets down to it, any horse could
fire.

I
come from a “mixed-meet” state, where Quarter Horses make up at least
a third of most race cards, so I get to see a lot of highly competitive
races, where the “set diagram” often looks like a pumpkin on wheels—a
lot of well-bred, hot horses making up a big Win Contender bubble.
Here too, and across the country, in some of the cheesier Thoroughbred
races, you may see the same diagram, but with Non-Contenders filling
the biggest part of the pumpkin. This is one reason you may already
love cheesy Thoroughbred races.

The
really useful thing about this Ballentine “set theory” image (which,
if you turn it upside down, resembles Mickey Mouse), is that when you
are making a conventional odds line, as discussed at the beginning of
this series, it is usually a __Win__ odds line, since that’s all
anybody ever talks about, as I did in Part 1. However, every odds line
is actually composed of Win Contenders, Money Contenders, and Non-Contenders.
How do you deal with that in an odds line?

The
short answer is: it ain’t easy. It’s not something you are going to
do with a pencil in the margin of your **Form**. It requires a computer
to do it quickly, but if you can do it in the background, without any
effort (that is, after it is programmed), it is a really nifty baseline
to use in planning bets against the public odds. [It also happens to
be such a seriously brain-bruising exercise that I do not know anyone
who has done it well who is going to divulge their exact algorithm.]
There is a relatively simple way, however, where you can weight your
odds if you make them by hand. I’m sorry to say I don’t know where
the idea originated, but it has been in the literature for some time,
notably in Dick Mitchell’s books as well as others. There are several
variations of it and, if you pursue it, you may want to try a couple
of different approaches or make up one of your own.

As
with any odds line, the first step is to rank the horses. You can do
it with the “mental templates” described in Part 1, or there may be
something inherent in your method that quantifies the horses. In my
case, I represent each horse with a speed figure (I’ll get into that
someday, but for now, be assured that the figure represents a whole
lot more than raw speed). If you do end up with a number representing
a horse, you have the essential ingredient for automating this process
either with your own program, spreadsheet, or database, if you wish.
If not, you can still do as described in Part 1 and estimate a probability
for winning for each horse, but don’t bother yet translating that to
odds. Instead, look at your ranked horses in order and decide which
are contenders. (There is a lot more to be said about Win-, Money-,
and Non-Contenders, but for now, just Win Contenders.) If you have
your horses ranked in order, you may want to draw a line to separate
the contenders from the non-contenders.

If
you come from a background in science, you already know this, but maybe
I should say it: this is __not__ “Science”—this is __Art__.
Even though we’re dealing with numbers and talking about computers,
we are not applying any rigorous tests or much or anything beyond opinions
and experience, when we use this approach. But, experience shows that
it works pretty well. Simply drawing the line between Contenders and
Non-Contenders requires some art on your part and you have to at least
define them to suit yourself in order to do it. The basic approach
is to weight the odds on the Contenders and what you are doing is, basically,
accounting for the tendency of the crowd to “pile on” contenders. The
amount that I recall seeing recommended most often is dividing 80% of
all probability between the Contenders (in proportion to your original
ranking percentage) and simply relegating 20% to all the rest without
worrying about distribution.

You
can see that if you have three contenders in a 12-horse race, this would
tend to load them up on shorter odds, while five or six contenders would
generally spread the odds more thinly. If you become adept at this,
you may not want to apply a rigid rule at all but, instead, use a sliding
scale that you adapt to fit the particular race as you see it. Again,
this is Art—and maybe a bigger canvas than you want to fool with, but
the most valuable thing that a “value bettor” can have is their own
“fair odds” line in order to evaluate value in the odds offered by the
public. I have some good friends who are masters of the game who go
a step further and use a __third__ odds line—an “Expected Line” —in
which they predict (somewhat like the Morning Line, but with significant
differences—and a __lot__ more accurately) what the public odds __should
be__. This gives them a finer level of analysis of what is represented
by the actual public odds, and it is especially useful as a warning
flag for false overlays, or cases of “JDFR” —“Just Don’t Feel Right.”
With that level of experience and play, a good sense of “JDFR” can save
occasional blunders.

Believe
it or not, some people actually __do__ the basic part of this approach
by hand—or, maybe with a ten-dollar calculator. While it’s not a required
course, it has a real place in the “Earn-While-You-Learn” University
of Horse Racing. As I said in the first of this series, it is also
a great refresher course, and when I feel myself getting jaded by the
routine of computer handicapping, I’ll stop and do it for fun. Some
people may say that money is the only thing, but even though it is not
my daily routine, there is a special satisfaction in handicapping a
race by eye and by hand, assigning artful percentages to Win, Money,
and Non-Contenders, vying with those percentages against the public
odds—and winning! Money isn’t __everything__, but it’s how you tell
you’ve won.