Recovering losses is something that worries all punters. Get too far behind and the prospect of trying to recoup becomes a mountain of problems.

We’ve talked in PPM over many years about various plans for keeping losses under control, and ways and means of recovering losses and getting back into profit.

Some 40 years ago, a Sydney magazine published a series of articles on this issue. One of them was about the Rapid Recovery Plan, designed to claim a small profit on all transactions every time a winner is struck. The idea bears repeating. The rules are easy to follow.

  1. One unit is invested on the first race on which you bet. The stake remains at one unit provided you are backing winners.
  2. When you strike the first loser, all subsequent bets are estimated by noting your loss and adhering to the following:
  3. If the horse to be backed is 4/1 or over, you divide the sum lost by four and invest the amount shown. EXAMPLE: You are losing $10. The horse to be backed is 5/1. Divide four into 10 and the answer is 2.5, and that is your investment, $2.50. If the horse wins at 4/1 or over, you recover all losses plus you will mostly make a profit.
  4. If the horse to be backed is quoted from 5/2 to 7/2 you divide losses by two to ascertain your bet size.
  5. If the price of the horse to be backed is from 6/4 to 9/4 inclusive, you invest a sum EQUAL to your losses. So if you are losing $10 at that stage then the bet is $10.
  6. If the selection is from evens to 11/8 your bet is DOUBLE the amount of your losses. EXAMPLE: Loss is $10, bet would be $20.
  7. No bets if a selection is at odds-on.

Let’s look at another example. You start off badly and back a loser at 1 unit ($10) in the first race. You are now $10 behind.

Your next bet is a 5/1 chance. The division is four into $10, meaning your bet is $2.50.

Let’s say this horse loses. You are now behind by $12.50. The next selection is a 5/2 chance, so you divide your losses by two, meaning your next bet is $6.00 (rounded down).

Okay, you strike a winner. Your return is a total of $21. This means that in all you have bet $18.50 and you have got back $21. Your profit is $2.50, or 13.5 per cent.

Now that you are in profit, you can revert back to a new series and kick off again with a 1 unit bet (remember that a unit can be any amount you like).

Let’s say you were at a point where your losses were $22, and your next bet was a “good thing” at 6/4. The bet would be $22. This would return you $55, giving you an overall profit on the series of $11, or 25 per cent.

Should this bet have lost, you would be $44 behind. Your next bet is a 3/1 chance. This means you divide that $44 by two giving you another bet of $22.

Should the horse win at 3/1, your return is $88. Your total bets to this stage amount to $66, so you are now in profit by $22, which is 33 per cent on turnover.

This all sounds fine and good, doesn’t it? And it is. What you must do, though, is check how you would have gone had you stuck to simple level stakes on all the bets.

It may well be that you would have been just as well off following the level stakes approach. Or maybe you would have been worse off.

When checking any staking plan, the final arbiter would usually be: Am I any better off than I would have been at level stakes?

If nothing else, a staking plan like the one I’ve outlined gives you peace of mind. Why is this? Well, you KNOW for a fact that as soon as you strike a winner you are going to be back in profit.

You don’t get this reassurance using level stakes. The reason the staking plan can offer this assurance is because it’s making you bet to recover, and that means higher stakes.

Personally, I’m very happy using the plan because my records of betting tell me that I am ALWAYS going to strike a winner after a smallish series of losses. And no matter how badly I’ve gone, I am going to recover all my losses with just ONE WINNER.

Of course, I have to be prepared to bet the required amount to achieve this. If I was losing $70 and my next bet was a 6/4 chance, I’d have to bet $70. If the next bet was a 4/1 chance, I’d have to bet $18 (rounded up).

If the 4/1 horse wins, my return is $90. In all, I have bet $88 and my return is $90. I am in the clear albeit with only a modicum of profit. But the slate is cleaned. I can forge ahead again and a terrible losing run has been forgotten.

By PB King

PRACTICAL PUNTING - JANUARY 2005