It is often said that a week is a long time in politics and the same cart often be said of the "punt". Since writing the April column, the revised Australian tipster's poll selections have had a bit of an up-and-down ride, for during the intervening time a new longest run of losers has occurred, with the betting bank taking a bit of a battering in the process.
Early March saw a losing sequence of 18, spread over two Saturdays, the bank decreasing from $73.50 profit down to a $33 profit, with the bet size rising to $8.50 before a $2.40 winner was found.
However, five more winners in the next fourteen selections not only recovered all the previous losses but also saw the betting bank reach a new high in regard to the level of profit.
As the month draws to a close, the last four weeks have seen the selections showing a level-stakes loss of just over 7 units, while the staking plan has improved the level of profit by an additional 16 units.
In developing the Basic Staking Plan used in the current test, an attempt has been made to protect the bank as best as possible, as the next best thing, other than winning, is the protection of the betting bank.
The Basic Staking Plan is a target based approach that attempts to win just a mere 10 cents per race for each $500 of the punter's bank; a ratio of 1:5000.
Very conservative and some would say ridiculously low; but many years' experience on the print has shown me quite clearly that protection of the betting bank is a must.
Of course, should the available betting bank be larger than $500, the objective per race can be changed to suit the individual needs of each punter in accordance with the 1:5000 ratio.
It is important to note that there will be approximately 1250 bets in a year, so that if the target is reached, a profit of $125 or thereabouts will be achieved, which should return a Profit On Turnover (POT) of about 10 per cent and a Return On Investment (ROI) of 25 per cent.
In that context the returns are comparable with those available elsewhere, albeit betting is high risk, but so are some other forms of investment that attempt to achieve similar returns and many of those fail dismally.
The Basic Staking Plan, unlike many other target staking plans, uses two divisors, one considered the major and the other the minor.
The major divisor is always 5 unless the price of a selection is $10 or longer, when the minor divisor is used. The minor divisor will be the price on offer for the selection less one, i.e. if the price on offer is $10, the divisor will be 9, if the price on offer is $15, the divisor will be 14, and so on. (Note: For anyone using the tote, the approximate dividend on offer five minutes prior to the start of the race should be used in determining the divisor.)
Most selections and nearly all the winners will be under $10. As at the time of writing this article, only 5 per cent of selections and only 4 per cent of winners have been priced at $10 or over.
In regard to risk control factors, again there are two: one limits the maximum bet size, the other limits the maximum longest losing run.
The maximum bet limit is set to $10, meaning that once a maximum bet of $10 is reached, unless that selection wins and the size of the next bet is reduced, then the sequence should be closed and recommenced with a base bet of 50 cents.
Likewise, the second risk control factor limits the longest losing run to twenty should the sequence regress into a loss situation. At this point the sequence should be closed and recommenced with a base bet of 50 cents.
In such circumstances, it is best to accept the situation, swallow one's pride and start all over again with the betting bank still intact. Hopefully, such situations won't occur, but nothing is guaranteed on the punt.
In determining the actual bet size, the Target (which is the sum of the number of races multiplied by 10 cents) less the accumulated profit or plus the accumulated loss is divided by 5 (or 10 as the case may be).
When this calculation is done (which is easy using either pen and paper or a hand-held calculator), it should be rounded down, i.e. if the actual calculation works out to be 98 cents, then the bet would be rounded down to 50 cents. Adopting this strategy gives added protection to the betting bank.
To summarize:
Target: 10 cents per race.
Base Bet: 50 cents.
Betting Bank: $500.
Maximum Bet Limit: $10.
Maximum Run of Losers: 20 (where there is a loss on the overall sequence).
Major Divisor: 5.
Minor Divisor: 10 (only used on selections priced at $10 or longer).
While punting is somewhat of a risk, my firm belief is that it is possible for recreational punters to have a bit of fun on the punt with some chance of winning.
By E.J. Minnis
PRACTICAL PUNTING - MAY 2003