In my view if you are to make serious money betting you need to be able to identify value bets. Simply picking winners will not be enough to make money in the long run. However, while people talk about making ‘value’ bets and assessing ‘value’ what are they talking about?
To assess ‘value’ properly you basically need to consider all the information in the formbook and work out what you think are the true chances of a horse winning a race. The next step is then to compare your assessment of the true odds with that of a bookmaker. If they offer better odds than your assessment then you have identified a value bet. This is what is called creating an odds line. For instance, your odds line might suggest that a particular horse is a 5 to 4 shot but the bookmakers have it chalked up at 5 to 1. The horse is clearly value and one would want to lump on at those odds. However, this all depends on how good your original method was at estimating the true probability of a horse winning, and in identifying the true odds.
A system that overestimated a horses chance of winning would identify plenty of value bets but you would end up losing in the long run because the bookmakers odds would more accurately reflect the true odds. In other words you would think that you were backing genuine 5 to 4 shots but later find your selections were winning at the frequency you would expect of horses priced at 5 to 1. In other words you would be expecting to record a strike rate of 44 per cent on your bets but ended up with just 17%. The first and most important thing is therefore to create a system that accurately reflects a horse’s true odds of winning. This is easier said than done. Some people have a natural instinct for this sort of thing, whereas others prefer a more technical approach. I follow the latter.
In this article I am going to take you through the four steps you would need to cover to produce a fairly reliable odds line for National Hunt handicap chases. In order to implement the method you will need some familiarity with Microsoft EXCEL or possess a scientific calculator. I’ll make use of plenty of examples so that you can try to replicate what I have done and then implement the method for real in future races. You could build on this approach and develop more sophisticated odds lines of your own, that include more variables. However, for now I’ll try to keep things simple.