[HN Gopher] The Gambler Who Cracked the Horse-Racing Code
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The Gambler Who Cracked the Horse-Racing Code
Author : sebg
Score : 28 points
Date : 2024-12-26 19:39 UTC (2 days ago)
(HTM) web link (www.bloomberg.com)
(TXT) w3m dump (www.bloomberg.com)
| brudgers wrote:
| Could survivor bias be a more likely explanation than a good
| system? I mean among a large pool of people systematically
| betting on horse racing, a few are likely to have winning
| outcomes.
| pakitan wrote:
| You can't become a billionaire by betting on hundreds of
| thousands of events via "survivorship bias". It's about as
| likely as getting 1000 monkeys typing on typewriters and
| producing Shakespeare's works in 10 years.
| brudgers wrote:
| You might win a billion USD in a single lottery draw.
|
| https://www.nytimes.com/article/lottery-jackpot-record-
| power...
| pakitan wrote:
| Yes, you can. Not sure how that's relevant to the
| discussion though.
| bryanrasmussen wrote:
| it's a typical HN Gotcha of which I myself am often
| guilty, given hundreds of different chances, and one of
| those chances can make you a billionaire, then you can
| become a billionaire by betting on hundreds of different
| chances - but of course horse race gambling doesn't give
| you that billion in one shot chance.
|
| on edit - well I guess it technically does it give it,
| but at such a high rate of investment it isn't really
| that worthwhile either. The point about the lottery is
| that a single ticket which costs little can return a
| billion. A horse race that returned a billion probably
| needs at least a 100 million to be bet, which is probably
| not even possible.
| nycdatasci wrote:
| Definitely not luck. Bill runs with the same crowd that wrote
| the bible on advantage play (James Grosjean, etc). They are
| exceptionally talented.
| skippyboxedhero wrote:
| Bill originally worked with a team of people doing this in HK
| (that later broke up, some of the people involved
| were...characters). There was a whole group of people doing
| this in the 90s (some of these teams also did Japan). I
| believe he did stuff in casinos but parimutal obviously had a
| lot more scale.
| caminante wrote:
| It's closer to a hedge fund finding asymmetries (e.g.,
| under/over valued odds by bookmakers, bulk buying strategies
| when phone buying is turned off, etc.) plus some structural
| benefits (e.g., HK was a gambler's dream. Winnings were exempt
| from taxation! And the "pit boss" for the horse-racing scene
| wasn't kicking them out.)
|
| These don't apply to all horse-racing scenes.
|
| These advantages emerge, but get competed away.
|
| Look at how the protagonists here were in black jack card
| counting teams. They do make money until they get blacklisted.
| patrickhogan1 wrote:
| The title for Bloomberg says
|
| "Bill Benter did the impossible: He wrote an algorithm that
| couldn't lose at the track."
|
| The article is more nuanced. He created an EV+ system. It
| included tickets bought that did lose as part of the system he
| used. In fact buying tickets that would lose was part of his
| system. Along with other tickets that would win.
| caminante wrote:
| Clickbait tagline indeed.
|
| Buying 50k individual tickets to win 13 million is great ROI,
| but didn't see guaranteed ROI.
|
| Also, the cover
|
| _> How to make $1 billion betting on horses_
|
| is called into question as it's alleged that at best, the firm
| may have made $1 billion, but not individuals. I guess a few
| allegedly came close? Hard to verify.
| yawnxyz wrote:
| Great article, very well-written narrative, but seems to leave
| some things out.
|
| From 2018 (please add tag)
| vajrabum wrote:
| Here are two papers referenced in the article. This one inspired
| Bill Benter
|
| https://gwern.net/doc/statistics/decision/1986-bolton.pdf
|
| And Bill Benter wrote this one in 1995 describing his system
|
| https://gwern.net/doc/statistics/decision/1994-benter.pdf
| leptons wrote:
| This story really hits me hard. I did a similar thing back in the
| early 1990s (but without the millions of dollars). I had one of
| the first Apple laptops, a PowerBook 170. I had Microsoft Excel
| on it. I had a girlfriend at the time that liked going to the
| races and spending what little money she had on it. A few times
| she won, but mostly she lost. After a few months of going to the
| races with her I decided to see what I could do to figure
| something out about it all. In the daily race program they
| include all kinds of information about the horses, which horse is
| next to which horse in the starting gates, which jockeys are
| riding which horse - there was a lot of info. I created a
| spreadsheet in Excel that was close to how the racing program
| looked, so I could input all the data as easily as possible. I
| was giving weights to things like what medication/drugs the
| horses were given, the gender of the horses, the gender of the
| horse on either side of it in the starting gate, track
| conditions, win history of the jockey, and so much more. I was
| trying to think like a race horse might think. Once I got the
| data all input into the spreadsheet, it took Excel quite a while
| to crunch the numbers, it was a slow 25MHz laptop after all. So
| eventually I was ready to take the laptop to the track and see
| what I could do with it. I got the race program and started to
| input data. Unfortunately it was so slow that the race would
| finish before the laptop would finish calculating. I was just
| testing it out anyway, I wasn't going to place any bets that day,
| nor could I because of the slowness of the laptop. Well, I got
| home and analyzed the horses that won, and I found that my
| spreadsheet had predicted the winning trifecta (1st, 2nd, 3rd, in
| that order) for every race that day. If I had bet the minimum bet
| on the first race on the trifecta, which was like 3 dollars
| minimum per race, and place the winnings on the next race's
| trifecta, I would have left the track that day with over $22,000
| in winnings. I was euphoric at that point. I knew I could tweak
| the spreadsheet or codify my algorithms into something faster. I
| started on it that night, but all of a sudden the hard drive
| crashed. The click of death. There was no getting it back, the
| laptop never booted again, and that was the last time I ever went
| to the horse races. From then on I just dropped my girlfriend off
| at the track and then went and did something else for a couple of
| hours. There's no way I could reproduce the algorithms from
| memory, it was far too complex, and I gave up on it. Reading this
| story makes me think I wasted some of my potential, but I also
| wasn't really interested in gambling as a profession, nor was I
| interested in what happens when people found out how I was
| winning the races.
| dtkirby wrote:
| https://archive.is/g32Da
| mrandish wrote:
| British magician Darren Brown aired a TV special called "The
| System" revealing a foolproof method which allowed him to provide
| the name of the winning horse to a lucky person who randomly
| responded to his newspaper advertisement in time for that person
| to bet on the race and win. He continued doing this with that
| person for six more races over six consecutive weeks - with that
| person betting and winning each time, ultimately amounting to a
| large sum. The bets were real, legally placed in advance on
| televised races at regulated betting parlors and the person
| really randomly responded to the ad without knowing Brown
| beforehand. For the last race Brown and the person met at the
| race track but for all the prior races Brown didn't even know
| when or where the person would place their bet. He really had no
| involvement other than providing the name of the horse to bet on
| via email.
|
| Of course, it's (sort of) a very clever trick. All is revealed in
| the show (now on Brown's YouTube channel at
| https://www.youtube.com/watch?v=jR970Y10WNw). I showed it to my
| kid who had recently asked me about a state lottery billboard
| claiming "Someone has to win!" and it proved to be an
| entertainingly effective answer as well as providing some good
| ways to think critically about gambling propositions.
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