In this article I want to explain my personal approach to betting and how that might apply to you.

I like high strike rate systems…

Personally, I far prefer high strike rate systems to riskier lower strike rate systems. This is partly to do with my character…

I’m the sort of person who enjoys going for long walks in my beautiful Breton countryside (I live in Brittany) or slowly driving down our pretty country lanes.

You’d never catch me going parachuting (it does seem rather strange to me to throw yourself out of a perfectly good airplane) or going to a track day (far too fast and furious for me.)

So, given the choice of a 40% strike rate system which returns 10% profits on stakes or…

A 10% strike rate system that returns 30% profits on stakes, I’d chose the former rather than the latter 8 days a week, even though the latter is far more profitable.

And, the reason being isn’t just down to my low risk character…

It’s also because, with the higher strike rate, I’d be able to stake a larger percentage of my bank and, thus, end up making more profit in the long run.

Because, of course, it’s profits that count.

It’s profits that count…

Now, when someone talks about a betting system, they’ll always mention Profits on Stakes.

They might call it Return on Investment or Profit on Investment but, really, it’s all the same thing.

And I’m a guilty as anyone else.

But I think that what we should really be thinking about is Return (or profit) on Bank.

Let me try to explain…

Let’s say that your great aunt Edna has just died at the perfectly respectable age of 98 (my condolences, by the way; I’m sorry for your grief) and…

Once her little bungalow at Frinton on Sea has been sold, you end up inheriting £10,000.

Now, some people might rush down to the casino and put it all on red.

Some people might spend it on a holiday of a lifetime or treat themselves to that, mid-life crisis, sports motorbike.

And some people might just find a safe secure investment such as an ISA or savings fund to put the money in to.

And, I suspect that if you’re reading this, you might fall into the latter camp?

Now, behind the scenes at that ISA (or savings fund) there are a whole bunch of overpaid traders and analysts making a whole bunch of bets with your money.

Oh no, they don’t call them bets…

They’ll call them trades or positions or something like that.

But, at the end of the day, that’s all they are…

Betting that shares in IBM are going to increase in value or betting that oil is going to fall in price in six months time.

You don’t get to see what those boys are doing and you have no idea what their strike rate or return on investment is.

All you get to see is how much your ISA or savings fund has increased in value at the end of the year.

And I believe that that is how we should view our betting.

Rather than worrying about strike rate or return on investment we should be saying…

“I started the year with a £1,000 betting bank and now, a year later, it is worth £2,000 – that was a pretty good investment.”

Of course, if you were using Place Profits (betting to level stakes) you would have started the year with a £1,000 betting bank and then, a year later, it would be worth £4,000

But it all depends on using the correct stakes. Those boys on the trading floor at your ISA or savings fund do that; they bet the right portion of your money depending on risk and opportunity so that they are not making too little profit or, heavens forbid, lose too much.

At least, I hope they are.

So, how do you work out your stakes?

How to work out your stakes…

You need to stake at such a level (or percentage of your betting bank) so that you can ride out any losing runs (or draw downs.)

It is just as bad to stake too little as it is to stake too much.

Luckily mathematics comes to the rescue here.

There is a magic formula which lets you work it out…

Log(n)/-log(1-SR) = ELR

N.B. SR stands for Strike Rate and ELR stands for Expected Losing Runs.

With the 80% strike rate that Place Profits provides and working it out based on 1,000 bets (Place Profits generates about 1,000 selections a year – although a few of them will be non-runners) your longest expected losing run is 4.3

So, does that mean that you should bet to a 5 point bank (to cover any losing run?)

Well, no. You could get 2 expected losing runs; one shortly after the other.

The general rule of thumb is that you should stake to 5 times your ELR, just to be on the safe side.

And, just to repeat, I’m a safe side type of guy; no jumping out of a perfectly good airplane with a parachute on my back (or haring round a race track in a fast car) for me.

So, with Place Profits (and its 80% strike rate) we should be betting to a 20 point bank (or betting to 5% of our bank.)

In fact, based on the 2018 and 2019 results, we could have got away with a 10 point bank (even if we took our profits out every month and, thus, reset the bank to the initial bank each month.)

After all, it’s better to be safe than sorry.

That means that, with a £1,000 betting bank, we should be betting to £50 stakes rather than the £10 stakes that would normally be the case.

And that more than makes up for the lower prices we get by place betting rather than win betting.

The graph below shows how a £2,000 bank would have grown (assuming level stakes and no take outs) over a 2 year period (2018 to 2019)

If this image is too small to see properly, you can click on it to see it full size. Don’t forget to click on your back button to return here.

  • You can check out the daily updated results at… Results
  • If you have any questions you can always contact me at…
  • If you want to find out a little bit more about me you can do so by taking a look at the About page.

I hope that this article explains my theory that, with betting on horses, it best to be the tortoise rather than the hare.

Small, consistent profits, but lots of them…

Work better for me that the occasional 10/1 winner but the inevitable long losing runs that other systems might provide.

Thank you for taking the time to read this…

If you want to see the spreadsheet that I used to record the selections (and the results), please feel free to download… level-stakes-with-monthly-take-outs.xlsx

You will see that, had you started with a £2,000 bank (and, thus, bet to £100 stakes) and taken out profits every month (where the month end bank was at least £2,000) you would end up, after 2 years, with your bank intact (although a few pounds down) and you would have taken out, over those 2 years, almost £14,000 in profits along the way.

Not a bad return for a £2,000 investment!

If you want to read about how I came up with the system, you can read about it at… How I Built The System.

If you are interested in how I was inspired to create Place Profits, I try to explain that at… When Life Gives You Lemons.

And, finally, if you want to see how I stake the selections, I explain that at… The Annuity System.

My kindest regards

Horse Racing Betting System Results