Overlays

The Horse players edge

The Stk2002 overlay analysis

Every successful horse player has a method of sniffing out the overlays in a race and will bet every one of them. Since it is so important let's examine this elusive critter for a moment.

An overlay is any horse whose off odds ( toteboard odds ) are greater than the horse's true odds. This doesn't mean "Morning Line odds" which are not true odds.

To get the probability that any horse will win divide the number 1 by its true odds to get what is known as the reciprocal of the odds. This will always be a decimal number that when multiplied by a hundred is the percent chance of winning. The sum of the reciprocals of a true odds line will always be the number 1.

One important thing to remember when betting overlays is that luck has no memory. For example if the #5 post position wins three races in a row that doesn't diminish the #5 post position's chance of winning the next race. It has exactly the same chance it would have if none of the previous races had run at all.

Another thing is that every bet sets on its own bottom. The relative odds of this bet has nothing to do with any other bets you may have made. There may be a one to one overlay in the same race that also has a ten to one overlay. Even though the one to one bet wouldn't pay for your other bets if it wins, it is still just as good a bet as it would be if you were not considering other bets.

The overlay analysis shows the profit or loss resulting from the overlay betting strategy. There are many strategies that could be devised. The most simple is to bet any overlay. The Stk2002 analysis report assumes a bet on every overlay that is also an A, B, C, or D selection.

Another strategy is to pad the off odds required to qualify as a bet. In this strategy the off odds must be grater than the calculated odds by a certain pad number. This strategy is useful when the accuracy analysis of the true odds shows a negative deviation. For a positive deviation the pad would be in reverse. We would subtract a pad number from the off odds.

The most conservative overlay betting strategy might only qualify a horse as a bet if its off odds were greater than the number of horses in the race, making it a longshot as well as an overlay. The difficulty with this is that there will be many races in which no horses qualify as a bet.

The "Odds Spread Variable" variable #18 controls the spread between low odds and high odds and so has a big impact upon how well the odds line represents each horses chance of winning.

The number assumes a $2 bet on A, B, C, and D horses that qualify as an overlay. The top four horses are broken out separately to give a better analysis of the results.