Profitable rates of return

[Alastair]

What do people feel is a realistic rate of return betting on the horses ? By this I mean initially profit on stakes(more on this below). Just rereading Patrick Veitch's book I see he claims a rate of 16.7% on turnover and I recall reading an interview with Jim McGrath where he says he reckons to have made a 10% margin. Veitch's is the highest I can remember claimed from someone for whom there is no doubt that on balance they have made a profit - I think Alex Bird reckoned to only make 2 to 3% . It's an interesting point because I think it demonstrates that anyone looking forward who believes that they have an approach that will lead to a return significantly better than 10% is deluding themselves.

Of course return on stakes is a crude yardstick. A business would more likely be assessed on its return on capital employed. This leads on to an interesting point regarding betting styles in that a punter should really be assessing their returns by reference to capital not turnover. Take 2 punters each with a 100 point bank and who each have 300 bets . Punter A has 30 winners from bets at an average price of 10/1 ; Punter B has 80 winners at an average price of 3/1. If stakes for each bet are 1 point  then Punter A has a profit of 30 points and a profit on stakes of 10% and Punter B has a profit of 20 points and a profit on stakes of 6.67%. But I would argue that it is Punter B who would make the more money because with such a higher strike rate of winners their losing runs are much shorter and therefore they can make much more use of their capital by having significantly higher stakes than Punter A - to the point where the higher stakes more than compensate for the lower percentage rate of profit on stakes.

Although punters must always follow the approach to betting that suits their temperament this does show that those who only look to biggish prices for their bets are probably not pursuing the most efficient approach.

[ormonde]

Interesting read this Alastair.

I have to respectfully disagree with 10% being a decent benchmark. I myself am running a tipping service that so far is making nearly 30% profit on stakes. It's nothing big and may go nowhere. I've only tipped 115 bets so far but I think I wont go below 20% on previous years records.

But very interesting all the same I had no idea that the known/famous professionals were content with such small %'s particularly Alex Bird.