How Are Horse Racing Odds Calculated?

September 6, 2017

Horse racing has been a part of the gambling world for almost 200 years, and has always been among the most popular sports to bet on. Today, horse racing comes in many shapes and sizes, and can be found in most countries around the world, with bookmakers offering an incredible range of bets along with each event.

When you win at a horse race, the amount that you can potentially walk away with is determined by two separate factors, each being equally important. The first is the stake, which is the amount of money that you decide to put down on a particular horse or racing event. The amount that you can stake is usually up to you, but many bookmakers will offer a specific stake range to choose from.

The second factor to consider are the odds. Odds are calculated and compiled by bookmakers, and these are what come into play when the total amounts of winnings are being processed. In essence, the odds give you an idea of how much money you can walk away if your horse wins the race, and it’s these odds that bettors and bookmakers use on a daily basis.

How Odds Are Calculated

TOP sports betting SITESJuly 2024
1 IE allowed5/5100% Match up to $250 AUD Bet now
2 IE allowed4.9/5100% Match Bonus Bet now
3 IE allowed4.8/5Login to see promotions Bet now

Odds are in a state of constant chance, and there are a huge amount of external and internal factors that come into play when odds are being calculated. It all starts at the bookmaker, and each bookmaker company employs a group of people known as odds compilers. These compilers spend most of their time gathering vast amounts of information. This information can include the type of event being bet on, for example the Crown Oaks Day, the horses and their history, the number of people that are betting online through internet betting or live betting, otherwise known as offline betting,  and much more.

With help from some others, such as form experts and gallop watches, the compilers create the odds and release them to the public. The compilers determine the profit margin the odds will work at, which is known in horse racing as over-rounding. The competition between bookies ensures that over-rounding never gets ahead of itself, and that all the bookmakers that participate in the event try and maintain the most competitive betting prices against their opposition.

How Events Affect The Odds

Older events are what odds compilers use to determine the kinds of odds and over-rounding that will be available for bettors to choose from. Horse that are well-known, for example, odds can be better judged by compilers, as they have an idea of how the horses will most likely perform during the race. It gives bookmakers the edge when releasing their odds, allowing them to be certain that they have set the right prices for each bet.

On the other hand, an event featuring relatively unknown horses is a completely different affair, and changes how the odds are eventually calculated. Due to the lack of knowledge, the bookie will often set much higher betting margins to try and recoup any losses made during the event. They don’t know how the horses will perform or how many bettors will take out bets on the horses, which increases the overall risk, and they need to try and compensate for that risk.

Horse Betting Odds

Horse race betting is a game of knowledge, and the more you have, the better equipped you will be for the next betting event. Knowing how the odds work is an extremely vital step to understanding the nature of winning horse racing bets.