Working out percentages and over-rounds

[Mac9]

I do apologise as I’m sure this has been done a thousand times, but I’m struggling to find out how this is done?

Help would be greatly appreciated.

[Glenn]

For individual horses

Traditional Odds: 100*(right hand number/(right hand number + left hand number))

eg 5-4 gives 100*(4/(4+5)) = 44.4444

Decimal odds: 100/odds

eg 2.25 gives 100/2.25 = 44.444

Calculating the overround

Sum these percentages for all the horses in the race

[Mac9]

Cheers for that!!

[davidbrady]

Hope this is what you want

Take a 4 horse race with all runners of perfectly equal ability

In a 100% (perfect) book, then all horses would have a 25% chance of winning the race and would be all priced at 3/1*

*calculated as 1/25% = 4.00 which is the decimalised equivalent (BF price) of 3/1 (ignoring commission)

In this scenario if a bookmaker was to lay equal amounts on all 4 horses then he would make no profit on the race – he takes in 3pts from the 3 losers but must pay the winning punters those same 3 pts.

Now suppose the bookie prices up all 4 horses at 2/1 – in this scenario the bookmaker will make a profit of 1pt – he again takes in 3 pts from the losers but this time he only has to pay out 2pts in winnings.

In this situation the overround is calculated as 33% which is the bookies profit margin. The overround is calculated as follows

Horse A = 2/1 = 3.00 (BF price) = 33.33% (1.00/3.00)
Horse B = 2/1 = 3.00 (BF price) = 33.33% (1.00/3.00)
Horse C = 2/1 = 3.00 (BF price) = 33.33% (1.00/3.00)
Horse D = 2/1 = 3.00 (BF price) = 33.33% (1.00/3.00)

The total percentages added up total 133.33% so the margin is 33.33%.

This is how the overround works in theory but any individual bookie’s profits will depend on how much money he/she actually takes in on a particular horse. In the "perfect" example, one bookie could have laid only the winner and will lose on the race while another could have laid only the 3 losers so will win on the race.

You hear a lot about how the bookies are creaming it by having huge overrounds at places like Kempton etc but in my opinion (and I will be shot down for this I’d say), the SP of most fancied runners (say <10/1) bears very little difference to the Betfair SP (the closest thing to a theoretically perfect 100% book we have), and it is at the unfancied end of the market where the main price discrepancies occur – ie horses with a SP of say 33/1 could have a Betfair SP of 100.0 or bigger.

[indocine]

Also, the overround is similar but numerically different to the bookmakers profit margin. Bookmakers *theoretical* hold is like (or/or+100)*100

7% overround

(7/107) *100 = 6.5% hold

Irish bumper 55% overround

(55/155) * 100 = 35% hold

[cormack15]

Where’s Ginger Tipster with his tables when you finally need them.

[Gingertipster]

I knew you can’t live without me.

Sorry, do not have time to comment. Working out Goodwood.

Reet, Flash, Fist and LGR can breath a sigh of relief.

If you want anything further on how to make a 100% book Mac, just say here. But I think the lads have covered most of it.

Ginge

Value Is Everything

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