Horseplayers vs Computer-Assisted Wagering (CAW)

🏇 Why Normal Horseplayers Are at a Disadvantage vs. Computer-Assisted Wagering (CAW)

**Computer-Assisted Wagering (CAW)**, also called *batch betting* or *high-frequency wagering*, refers to teams or syndicates using algorithms, live tote feeds, and huge bankrolls to bet efficiently — often in the final seconds before a race starts.

Here’s how and why that creates disadvantages for everyday players:

1. **Information Timing**

* **CAW teams get near-real-time tote data** (odds, pool sizes, will-pays, exacta and trifecta combinations).

* **They often place bets at the very last second**, after seeing where all other money has gone.

* **Normal bettors’ odds change after their bets are placed**, because the CAW money floods in late and moves the pools dramatically.

*Example:* You bet a horse at 5-1 with two minutes to post. By race time, after CAW money hits, it drops to 2-1. Your expected return just got cut by more than half.

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2. **Rebates and Pricing**

* CAW teams receive **large rebates** (often 8–12% of handle) from tracks or ADWs (Advance Deposit Wagering platforms).

* A casual player gets **no rebate or a tiny one** (maybe 1–3%).

* That means a CAW bettor can **profit on bets with a small negative expected value** — because rebates make them positive overall.

*Example:* A CAW team bets into a 16% takeout exacta pool. If they break even on pool results but get a 10% rebate, they make 10% profit. A normal player loses 16%.

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3. **Pool Impact**

* Because CAW wagers are huge and concentrated, they **dominate pools** and cause wild late odds swings.

* The **price efficiency** they bring (removing “value”) makes it harder for non-CAW bettors to find overlays — horses whose odds are higher than their real win probability.

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4. **Data & Technology Gap**

* CAW bettors have **custom software, proprietary models, and direct API access** to tote systems.

* Regular bettors use public past performances and manually input bets.

* That’s like a retail trader vs. a high-frequency trading firm on Wall Street.

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How We Could Fix or Balance This

There are several approaches — some regulatory, some structural, some technological.

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**1. Control Late Betting (Stop the “Flash Crash”)**

* **Lock wagering pools earlier** (e.g., 30 seconds before off-time) to prevent last-second CAW floods.

* **Or display final odds before betting closes**, giving transparency.

* Some jurisdictions (like Hong Kong) already do this successfully.

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**2. Level the Rebate Field**

* Either:

  * Reduce or ban **rebates tied to wagering volume**, or

  * **Offer tiered rebates** accessible to all players, not just CAW syndicates.

* Equal pricing would make the playing field more fair.

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**3. Transparency & Disclosure**

* Require **tracks or ADWs to disclose CAW activity**: how much of the pool they control, how much rebate money is paid out, etc.

* Let players understand **how odds are being formed**.

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**4. Separate or Segmented Pools**

* **Create separate pools** for CAW and non-CAW players.

* The Hong Kong Jockey Club uses different wagering channels with latency controls — a model U.S. racing could emulate.

* Keeps retail players’ pools less distorted by last-second large bets.

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**5. Improve Tools for Regular Bettors**

* Provide **public APIs, live tote data, and analytics tools** for individual bettors.

* Encourage innovation in handicapping software that helps smaller players use data more effectively.

* Promote **fixed-odds betting** where available — where your price is locked in when you bet.

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**6. Incentivize Early Betting**

* Offer **early-bird rebates or guarantees** for wagers placed before a cutoff time.

* This stabilizes the pools and reduces last-second odds drops.

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| Problem            | Cause                         | Possible Fix                              |

| —————— | —————————– | —————————————– |

| Late odds drops    | CAW last-second batch betting | Lock pools earlier                        |

| Rebate inequity    | Volume-based deals            | Level or disclose rebates                 |

| Price inefficiency | CAW dominance                 | Separate pools or restrict late CAW bets  |

| Tech disparity     | CAW access to APIs and data   | Public APIs, better tools for individuals |

| Pool instability   | Massive last-second wagers    | Incentivize early betting                 |

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