With Pari Mutuel betting, which was created by Pierre Oller in France in the 1860s, bettors wager against one another, with odds being determined by what percentage of the pot is bet on each competitor in the race or event. You’ll find the Pari Mutuel system in effect in horseracing, greyhound racing and jai alai contests.
Pari Mutuel Basics
With Parimutuel wagering, tote boards or totalizators display the latest betting patterns. As more wagers are placed, the totals are calculated, betting patterns are shown and the odds are changed. It isn’t until the start of the event that the odds are set. Thus, the longer one waits to wager on a Pari Mutuel bet, the clearer the final odds will be.
All of the money wagered on an event is placed in a pool. Before any cash is paid out, the rake is taken by the house. The rake consists of any taxes and expenses and can be anywhere from 10 to 25% of the pooled money. The rest of the cash is then divided evenly amongst the winners.
Pari Mutuel Payouts
As an example, if the pool money after expenses totals $1,000 and horse one is two to one and horse two is four to one, the payouts on each horse will be different. These odds are determined by how much money is wagered on each horse.
In our example, horse one offers less of a payout because more people wagered on it, while horse two, with fewer bets riding on it, pays more. The first horse has 500 bets, while the second is carrying 250 bets.
Pari Mutuel Calculations
These days when you go to a track the odds for each competitor are instantaneously calculated and continuously updated. If you’re wagering on a horserace, you’ll be given odds for each horse if they win (first-place), place (second-place) or show (third-place).
If you wager on win, then the horse must win in order for you to realize a payout. Putting cash on a horse to finish in the place position, means that you’ll win if the finish is either first or second-place. A show outcome allows you to collect money on the horse if it ends up in first, second or third-place.
The point of Pari Mutuel wagering is to offer an honest payout on each bet. If the favored participant wins, the payout is less, while a long shot, which would have fewer bettors would pay a lot more per wager.
However, if you’re looking to make a big score by wagering on an underdog, you must be aware that a long shot that starts at 50- 1 can end up offering a less advantageous payout. Odds can drop to 40- 1 or even 35- 1, depending on how many people think the least favored horse will win. As money is pooled and more bets are placed odds continue to fluctuate.
Pari Mutuel Tips
Because Parimutuel betting odds change up until the start of the event, it’s best to wait and wager just before the event starts in order to understand exactly what odds you’re getting. Prior to any money being wagered, estimated odds are displayed on the tote board.
If you do wait until the final minute or so to wager, make sure that you are physically in position to do so. Once the race starts, no bets are taken. In order to not be shut out from placing your wager, bettors need to be right at the betting window.
Betting across the board is not always a good wager. If you put money across the board that means that you’re making a win, place and show wager on the same horse or greyhound. If you bet $10 across the board, you’re actually wagering $30. A first-place finish will pay much more than if your bet ends up in the second or third spot. The show spot is usually a break-even bet. Instead of wagering across the board, you should consider making three separate first-place wagers at $10 per bet. The same amount of money is spent, but each first-place bet usually has more profit potential than a place or show wager.
As soon as you start wagering on exotics, such as the Daily Double, Exacta or Trifecta, you undercut your chances of winning. The fact is that these wagers are all akin to parlays and parlays, which involve wagering on numerous sequential outcomes, are extremely difficult to hit. Instead of trying to win this type of bet, you’re better off putting your money on various horses in one race to win.
If you do decide to wager on more than one horse per race, be sure to calculate each possible outcome. If you put $10 on a horse that’s 2- 1, another that’s 4- 1 and a last that’s 7 -2, even if you win the first wager, you’re going to lose money. The other two will result in a profit.
Pari Mutuel wagering offers additional excitement for the bettor due to the fact that the odds constantly change. This system results in a range of betting choices that with careful monitoring can be exploited by gamblers.