Friday, January 18, 2013

Guest Blog: Players and Owners: Who's the Real Gambler?

Folks who believe that such risk-taking is pathological would call us “co-dependents”

Mark Cramer

I used to think that we horseplayers were keeping owners in business, thanks to the betting handle we provide. But it may be that horse owners, through their own risk-taking, are keeping players in business.

According to “The Utility of Sport and Returns of Ownership: Evidence from Thoroughbred Racing” (Gamrat and Sauer, Clemson University, 2000), “Most analyses of the earnings of thoroughbred racehorses indicate that the average return to ownership of a racehorse is negative.” Other studies echo this opinion. Gennaro (University of Tennesee, 2003) writes that “Previous research demonstrates conclusively that owning thoroughbred racehorses tends to be a losing financial proposition.”

In the Ed Bain past performances, which contain owner statistics, I scanned a few days of racing and extracted one particular owner who seemed to have the best winning percentage. Triangulating with information from the Horse Racing Nation website and Equibase, I checked the records of this owner. From the year 2000 to the present, his stable averaged earnings of $3,234 per start, producing earnings of $2,182,950 for the period of slightly over than 13 years. Subtracting training, vet and other expenses, that looks like a loss to me.

That got me to thinking that without risk-taking owners, we players would not have a life. So maybe we really need each other: players and owners. Folks who believe that such risk-taking is pathological would call us “co-dependents”.

I’ve struggled to come up with some statistic that would show that a player has a better chance to make a little money from this game than an owner. I suspect this is true but I cannot prove it. My evidence is entirely anecdotal.

For the most part, owners and players cross different paths, hardly realizing how much they need each other.

The March-April edition of Harvard Magazine (March-April 2012) features an interview with racing writer, publisher and player, Steven Crist. Journalist Craig Lambert wrote: “People sometimes remark that the one thing [Crist] hasn’t done in the sport is own a racehorse.” But Crist responded: “I own the horse I’m betting on for one minute and 12 seconds, and that’s good enough for me.”

This exemplifies a convergence of betting on and owning a racehorse! My bicycle and betting partner Alan Kennedy goes a step further. Like several of my racing friends, he’s bridged the gap between player and owner.

“As for owning horses,” Alan says, “I don't consider it a gamble, since the odds are so much higher against the owner compared to the 15% betting takeout, so the net result will be a financial loss. However, compared to owning a sports team, the cost of racing a modest horse is a bargain for those who want to go beyond betting on the races.  The thrill of being in the paddock, talking to the trainer and his or her crew, meeting the jockey who is wearing my silks, and maybe even seeing my horse do well in a race - that is a priceless experience.”


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