I was watching Around the World in 80 Days last night, and I have a question about betting and odds. There’s a scene where people are betting on whether Fogg will win his bet. A man by a large chalkboard changed the odds based on any new information that came in. I understand that betting on horses and such is the same way.
So let’s say you bet on an event, and the odds are 40:1. Then new information arrives, and the odds change to 5:1. You win the bet. Are you paid at 40:1, the odds at which you placed your bet; or are you paid at 5:1, the odds after you placed your bet?
The general case of horse racing in the UK, is easier than this specific fictional case. The odds given on a particular hiorse in a particular race can change right up until a moment before the race. Say the bookie is offering odds of 10-1 when you bet. By the time the race is run, it might have changed to 20-1, or it might have changed to 5-1.
When you place a bet you can fix the odds at whatever the bookie is offering at that moment. He writes the odds on your betting slip, and if your horse wins, he pays you at those odds. If you bet at 10-1, and the odds have changed to 5-1, or 20-1, you still get paid at 10-1.
Or you can take Starting Price (SP) which means that he pays you whatever odds the horse runs at. If the odds have gone to 20-1 that works in your favour, if they have gone to 5-1 that works against you.
I haven’t seen the film, but after playing many horse races and placing other types of bets, my understanding is this:
– If a bookmaker is offering 40-1, and you place a bet with him or her when he or she is offering 40-1, you will be paid off at 40-1 if your bet wins.
– If he or she changes the odds (lowers them, say) after you place your 40-1 bet, you will still be paid at 40-1. You’ve essentially “locked in” your wager at 40-1.
– A horse race track generally uses the pari-mutuel system of wagering (often called simply the “tote”), where the odds are the ratio of bets on one horse to bets on all the others in the race. Thus the odds can and do change as more bets are placed on different horses. But because the odds are a ratio, and the payouts must balance according to the ratio, holders of winning tickets will be paid at the odds as they were when the race started, not when they placed their wagers.
Some jurisdictions allow both bookmakers and the tote to operate simultaneously at the track. Australia is an example. This is a great boon to bettors, if you can play it right–if the tote odds are dropping on the horse you’ve selected, you may still be able to “lock in” better odds on the horse from a bookmaker.
Of course, these are not hard and fast rules. I’ve heard about some bookmaking operations that do operate as pari-mutuels, meaning that the odds you buy in at are not necessarily those you will win at. When betting with a bookie, it is always best to ask if he or she pays at the odds posted when you buy.
On preview, I see that Peter Morris has answered the question pretty well, but I’ll post mine too, for what it’s worth.
If I’m at my local track and I see a guy in a pinstripe suit with a pinkie ring offering better odds than the track, would I be breaking the law if I placed my bet with him?
The others have already given pretty good explanations, just to add:
Logic will say that the odds for the bet in the example would be at the price when the bet was struck (I haven’t seen the film, I’m assuming that the bets are being taken in the period that the attempt is underway in?) - if the bet is to be successful, the odds will likely decrease as it comes nearer to completion - there would be no point placing a bet if you knew that you would recieve much lower odds than the actual true odds at the time when the bet is placed.
Peter Morris has already given an explanation of ‘Starting Price’ odds which can be utilised by people betting on British horseraces in Bookmakers shops or by phone or online betting. Generally speaking, bets placed with bookmakers on the actual racecourses are at the current odds rather than SP. Bets on other sporting events, outside Horse and Greyhound racing are always at the odds quoted, as there is no comparable SP system.
I agree with Julius here–bookies are generally not legal at US (or Canadian, for that matter) tracks. Nevada may still have legal bookies willing to book horse racing bets at prescribed odds, but I’m not sure.
But to clarify, the tote operates so government and the track can get its share of the funds bet. North American tracks that operate a pari-mutuel system take a percentage of the pool of funds that are bet on a race. This pays for the track’s operating expenses. The percentages that the track takes from the pool are printed in the program and in the Daily Racing Form, and the odds that you see posted on the tote board are estimated on the total pool less the percentage.
I understand that bookies in other jurisdictions (say, Australia, to continue my previous example) pay a fee or a percentage of their daily handle to the track and the government in order to operate legally. Can anybody confirm that this is the case, and perhaps give examples of the fees/percentages that bookies must pay in their jurisdiction?