Money Management - It’s The Only Way To Play Successfully!

“It matters not the number of winners you select, if you don’t know how to bet ‘em.”
- advice from a long since retired
successful handicapper.

“I don’t believe it! All I did was cash tickets all day and I still lost money.”
- words from an average
everyday racing fan.

Have you ever noticed how many so called experts of the turf, day in day out, pick four or five winners on a Thoroughbred card and still go home broke!? And let’s be honest, it’s probably happened to you too, right!? The reason is always the same; poor money management!
Money management is probably the most forgotten handicapping tool that exists today, virtually ignored by everyone, especially those who are not serious about their handicapping. Look around you the next time you visit the racetrack. It won’t be difficult to point out the many handicappers, and good ones at that, who although having a definite feel for selecting winners, have no money management skills. In fact only a small percentage of serious bettors know how to patiently handle their betting bankroll, and be successful at it.
As we have mentioned in previous columns, the modern day handicapper is blessed with knowing that a normal day at the track will consist of a live race card of 10 or 11 races, then a potpourri of simulcast cards, where one could have the luxury of betting another 40 to 50 Thoroughbred races. Throw in a couple of Standardbred cards and you have the makings of “tap out city”. But this can be prevented if one does not attempt to pick the winners of every race. Many handicappers are compulsive gamblers and really don’t employ any patient handling of their betting bankroll, and it is their belief, that the only way to be a success is to bet every race. They bounce back and forth from track to track like a tennis ball. Does anyone come to mind? Research too has shown that compulsive gamblers who feel the need to bet every race available had better be pretty “tight” with their bank manager and should also take some cooking classes. Why? They’re virtually on the road to financial ruin. They are going broke and their wife will soon be leaving them!
As the road to financial ruin is not really what I consider the admirable choice, I subscribe to the theory that it is better to establish a money management program, and stick to it. Establish a betting budget and don’t waver from it. Many attempt to be “Superman” and bet every race while others feel that by “doubling up” on their bets they will increase profitability. Big mistake! Simply put, it is better to bet with your mind than with your heart, as the latter only gets in the way of better judgement.

A Money Management Betting Plan

It has been suggested that a percentage of bankroll betting plan is a good form of betting discipline, sort of a pick your spot approach. Also, it can become a form of insurance that prevents a disaster from happening. Sure it’s not too difficult to figure that one way of increasing profitability is by betting more, especially on a horse that seems to be holding a decided edge over the rest of the field. But as was previously discussed, “doubling up” is for “tap outs”. Especially if your selection with the decided edge happens to lose. And as we all know, it’s still a horse race. Without some form of betting discipline you could be loitering on the steps of the “tap out motel”. Take a moment and consider these small words of advice from the professional bettors that successfully make their living playing the horses - “Never make a bet that if you lose, will take you out of the game!” Words to live by and win by! It is imperative that you learn to stay in the game for a long time.
A suggestion for one of the better money management betting plans is to consider betting the square root of your bankroll. This approach adds straight bets and exotics together. To illustrate: If your bankroll is $144, bet $12 on the race. If you win, then take the square root number of your increased bankroll total. If you lose, then you have automatically decreased your next bet size to the square root of $132. Your bet size floats as you go from race to race. When you become hot your bankroll increases. A losing streak and your wager automatically cuts back..
What you are actually doing is giving yourself a stable (no pun intended) betting plan and some insurance to prevent a quick “tap out” Theoretically, by betting a square root (you can even settle on a percentage of your bankroll if you are not necessarily mathematically inclined e.g. 10 per cent per race), you have given yourself some insurance from going broke. You don’t buy a house without insuring it, so start demanding some insurance on your equine investments at the track as well!

Fine Tuning Your Plan

One can fine tune this money management plan to meet your own betting strengths, and weaknesses. I would suggest you ask yourself this – Do the horses I select either win, or do they finish up the track? If this describes your betting profile, then you are what is called an “on the nose” player! Simply, your selections either win, or they are off the board. On the contrary, you may be one of the many who have a high percentage of your selections not winning but rather finishing in either the place or show slot. If this is the case, you need to consider a betting plan that involves converting your bankroll into a units system. Possibly bet 1 unit to win and 2 units for place. Or possibly 2 units of your bankroll to win and 1 unit to place, always staying within your total percentage of your bankroll figure. As for show wagering, use it only if in your opinion the favourite on the board looks “false” and has a good chance not to hit the board at all, let alone win the race. False favourites as have been outlined in prior articles will wreak havoc with show pools if they finish out of the money. In fact $20 or $30 show payoffs on horses are not out of the norm at times, especially in simulcast environments where show pools may be smaller and minus pools may be created from strong local opinions. In fact, it’s always good practice to get into a habit of comparing all of the live pools to the local ones provided before making a serious play.
A unit can be $2 or $20. Whatever you make it. Let’s say it’s $10, and you are a high percentage board selector. In this example, you may wish to bet $10 to win and $20 to place. Or $20 to win with a $10 place backup. Keep written records of every wager you make, and go over the numbers before you make your bankroll bet decision.
Most importantly, be sure that you are betting only one race at a time. By this I mean that you make your selections and then wager an equal (per cent of bankroll) amount on each race, adjusting your square root or percentage race by race. And don’t be tempted on “persuasions from your heart” - something to the effect “the stakes race looks like a good play, so I’ll double up on that and I’ll cut in half my play on the allowance race on the turf”. It sounds good but what you are actually doing is not only handicapping one race but you are also making one selection more solid than the other one. You are betting two things at one time and you are bound to lose!
The whole purpose of this article is not to belittle the good handicappers that do exist out there. Rather, it is meant to help prepare you from the evils of attempting to be “Handicapping Superman” by picking the winners of every race available. By betting from a predetermined percentage of a bankroll and establish at the outset whether you are a better win or a win-place better, your chances will improve.
It’s not easy money management but it is certainly essential and in the long run will make you a better handicapper.