Is there value in backing at short prices at Cheltenham?

An examination of short –priced horses at the Cheltenham Festival 2008-2012.

This article was written by us for the Secret Betting Club Cheltenham 2013 Profit Pack - completely free to download via this link: 

We at The Market Examiner relish studying the betting markets, and the clues that can be garnered from them in terms of finding profits. For the last couple of years, we have looked at how profits, at least historically, can be garnered by watching late moves in the big handicaps at the Cheltenham Festival at certain prices.

But what about those horses at the front of the market? When a horse is priced up at 3/1 or shorter at opening show, in such competitive fields as Cheltenham, you know there has been long, sustained support for these particular animals, normally over several months.

So when we’re looking at the last twenty minutes before a race, should we take any stock in price shifts at this late stage?

And also, what is the record like of these “Cheltenham bankers” anyway?

First of all, let’s look at the results of them all, to BSP. All the results below assume 5% commission is deducted from winning bets.

Selections	57
Wins	17
Average BSP	3.10
Average BSP of Winners	2.73
Strike Rate	29.82%
Required Strike Rate	36.6%
Longest Winning Sequence	3
Longest Losing Sequence	6
Profit/Loss	-12.01pts

So it’s clear that to back short-priced horses at BSP in the last five years at Cheltenham completely blindly has been a losing strategy.

What about those horses that have opened at shorter than 2/1?

Selections	23
Wins	10
Average BSP	2.12
Average BSP of Winners	2.08
Strike Rate	43.48%
Required Strike Rate	48.1%
Longest Winning Sequence	3
Longest Losing Sequence	3
Profit/Loss	-2.75pts

As you might expect, a better strike rate, but still showing a loss to level stakes.

How about horses which opened up at evens or shorter?

Selections	14
Wins	7
Average BSP	1.85
Average BSP of winners	1.82
Strike Rate	50%
Required Strike Rate	55%
Longest Winning Sequence	3
Longest Losing Sequence	3
Profit/Loss	-1.56pts

So, we would have needed a strike rate of at least 55% to turn this into profit, nearly there but not quite. Big name casualties include Kauto Star (twice), Master Minded in the 2010 Champion Chase and Hurricane Fly in last year’s Champion Hurdle.

Of course most of these races are the non-handicap events, and what of those apparent handicap blots, the good things that surely will run huge races. This the record of horses from 2008 to 2012 in handicap contests  that have opened at 3/1 or shorter:

Selections	6
Wins	0
Average BSP	4.05
Average BSP of winners	N/A
Strike Rate	0%
Required Strike Rate	NaN
Longest Winning Sequence	0
Longest Losing Sequence	6
Profit/Loss	-6pts

Interestingly, only Ashkazar, in the Fred Winter back in 2008 was the only one of these placed, finishing second.

So what about the effects of market moves at these sorts of prices.

First of all, it is interesting to note that of the 57 horses which opened at 3/1 or shorter:

35 shortened in price; 9 stayed the same price; 13 drifted in price

So 61.4% of the horses which opened at 3/1 or shorter were backed in to an even shorter price. Surely the effects of great numbers of people wanting to get on the “good thing” in whichever particular race.

This very fact may be a reason why backing these fancied runners at BSP is seemingly unprofitable, the value has just been sucked out of the market (at least when blindly backed).

Let’s look at the record of the 35 horses which opened at 3/1 or shorter and shortened in price:

Selections	35
Wins	10
Average BSP	2.84
Average BSP of winners	2.81
Strike Rate	28.57%
Required Strike Rate	35.5%
Longest Winning Sequence	2
Longest Losing Sequence	7
Profit/Loss	-7.76pts

So we would have needed about 7% more of these selections to have won to have turned this into a profitable line.

What about those horses which stayed the same price (they may have touched different prices, but eventually settled at the same ISP).

Selections	9
Wins	0
Average BSP	3.75
Average BSP of winners	N/A
Strike Rate	0%
Required Strike Rate	NAN
Longest Winning Sequence	0
Longest Losing Sequence	9
Profit/Loss	-9pts

A pretty small number of horses really and possibly a bit of a quirky result. Four of these came second.

So what about the horses that opened at 3/1 or shorter, and then drifted in price:

Selections	13
Wins	7
Average BSP	3.32
Average BSP of winners	2.62
Strike Rate	53.85%
Required Strike Rate	38.2%
Longest Winning Sequence	2
Longest Losing Sequence	2
Profit/Loss	+4.75pts

Again, it’s a pretty small number of selections, but that’s quite an interesting result, in that we finally have come across a seemingly profitable line. Funnily enough, the World Hurdle has been responsible for three of these winners, with Punchestowns also being a drifting “qualifier” in 2009, finishing 2^nd after hitting 1.7 in running. It’s important to note that these drifts really aren’t big drifts, we’re talking a touch of unease, for example 5/4 to 11/8 (Inglis Drever 08 World Hurdle), 2/1 to 9/4 (Denman 08 Gold Cup), 4/5 to 5/6 (Big Buck’s ’10 World Hurdle). The sample is far too small to get carried away by, but it does appear that a slight drift on a well-fancied favourite close to post time is really nothing to worry about at Cheltenham.

Let’s now compare well fancied favourites in the hurdle races, compared to chase events.

First of all, how do horses who open at 3/1 or shorter do in hurdle contests:

Selections	26
Wins	11
Average BSP	2.9
Average BSP of winners	2.62
Strike Rate	42.31%
Required Strike Rate	38.2%
Longest Winning Sequence	3
Longest Losing Sequence	4
Profit/Loss	+1.89pts

So favourites in hurdles seem to have a better record than their chase counterparts; Here’s the table for them:

Selections	30
Wins	6
Average BSP	3.25
Average BSP of winners	2.95
Strike Rate	20%
Required Strike Rate	34%
Longest Winning Sequence	3
Longest Losing Sequence	13
Profit/Loss	-12.9pts

That’s quite something then, the well fancied chase favourites, at least from 2008 to 2012, have a far worse record than in the hurdles contests, perhaps a reason for Simonsig fans in the Arkle, or Dynaste in the Jewson to temper their enthusiasm a touch this year..

Just one final note to end on, some more food for thought.

If you blindly backed all the horses which opened at 3/1 or shorter at Cheltenham next time they ran (so, after Cheltenham, in either the UK or Ireland), this is their record:

Selections	55
Wins	26
Average BSP	3.31
Average BSP of winners	2.49
Strike Rate	47.27%
Required Strike Rate	40.1%
Longest Winning Sequence	8
Longest Losing Sequence	6
Profit/Loss	+7.83pts

A terrific strike rate, a nice profit, and a ROI  of +14.24%.

13 of these 55 horses which ran next time also came second. No surprise of course, that well fancied horses at Cheltenham are good enough to go somewhere else and run big races, but it’s quite interesting that seemingly they are better value at BSP next time than they were at Cheltenham, and of course that is what it ultimately all comes down to in the pursuit for profits.

If you would like a copy of the excel document which lists the names of all the qualifiers we’ve spoken of above together with the races they were in, as well as such stats as in-running lows and highs, trainer details, next time out results, and plenty more, please email us at selections@themarketexaminer.co.uk and we’ll be happy to send it to you.