The statistical edge

One way to get an advantage is if you get $6.00 about a horse that starts at $5.00. You have obtained an edge on the price. If over the course of the year you are able to maintain that type of edge your chances of success will have significantly improved and be better than the punters who have got $5.00.

We all know that makes sense.

But it is mistakenly believe by some punters that you can get a statistical edge when backing your $5.00 horse by doing the following:

Firstly back a "sure thing" for the place in an all-up bet with your $5.00 selection for the win.

For example, you might believe that Miss Finland is a "sure thing" so you put your $10.00 on it for the place. When it pays $1.20 the place you get back $12. This $12 then goes on your selection at $5.00. If your $5.00 selection wins you get back $60 for an overall profit of $50 on your $5.00 chance.

It is mistakenly believed that you have found a way to get $6.00 for your $10 bet on your $5.00 chance instead of just $5.00. You have found a way to get a return of $60 and win $50 for your $10 bet instead of just winning $40. So, it is mistakenly believed, you have given yourself an increase or edge of 20% by getting $6.00 instead of $5.00.

That is false. It is not correct to claim you have found a way to get a 20% edge.

Here are the facts:

You have not got $6.00 about your $5.00 chance. You have not got a 20% edge. You have risked $10 on a $1.20 place bet. There is no such thing as a sure thing in racing. If that $1.20 place bet missed out, the $10 you were intending to bet on your $5 selection would be zero. You won that place bet. You then bet $12 of your money on your $5.00 selection. Your return was exactly what it should be for betting $12 on a $5.00 selection.

To put it in a simple way, imagine you first bet $10 on your $5.00 chance. It won and you got back $50. Where's the 20% edge? Of course there's none. Then you put the $50 on a $1.20 place chance. If it won would you claim an edge of 20% with your win bet on the $5.00 chance? Or would you instead claim a massive edge of hundreds of per cent on your $1.20 place bet? It's of course totally incorrect to do either.