Most handicappers and handicapping systems are preoccupied with selecting the horse most likely to win the race, when they should look for the best wagering opportunity. Suppose your selection method comes up with a horse that will win two out of three races (67%), and it will produce a 40% profit each time the selected horse wins, do you have a winning method? Sadly, the answer is NO. You will wager $6 every three races, and your return on the two winning attempts will be $5.60 ($2.80 + $2.80), a loss of close to 7%. While you have found the horse most likely to win, repeated bets on such a horse will almost certainly cost you money.
Now, suppose your selection method produces one winner in every ten starts, but when you find that winning selection the horse pays the same 40% profit per win as does that the odds-on favorite who wins two out of three races. Do you now have a winning method? The answer is a resounding, YES! Ten wagers would require an outlay of $20, and just one winner paying $28 will give you a 40% profit, certainly preferable to a 7% loss. Repeated wagers on horses that meet such criteria will almost certainly show a profit over an extended period of time.
This is not to suggest that indiscriminately playing long shots will produce a long-term profit. Nothing could be further from the truth. However, if you can find a way to isolate when a horse that should be going to post at odds of 6/1 is actually offering odds of 10/1, you have found a solid wagering opportunity. I have found that by watching the odds on morning-line choices four and five, I can often find such favorable wagers. I do this by watching the tote board.
A Public Choice study of races held in 2002 showed that the fourth choice in the wagering produced 11% winners while the fifth choice produced 7.4% winners. In 2010, the percentages were 10.3% and 7% respectively. If you focus on these two groups of horses, look at the probability each horse has of winning, and then compare that to the reward offered, I am certain you will find a way to generate profits, not losses, from your handicapping.