The Power of Compounding

[jms62]

Originally Posted by moses

So it’s been a while. I hope everyone is doing well.

I’ve recently become intrigued with the idea of taking a small initial bet ($5, 10, 20…nothing major) and seeing how many consecutive show bets I can hit while rolling the winnings forward each bet.

With an average payout of $2.50 to show, it would take 25 consecutive winning wagers to hit $5,000. I suspect if I get on a streak that I’ll chicken out before I hit the $5,000 mark or entirely lose discipline and start dipping into those funds for other wagers.

But that said, how dumb is this idea? Has anyone attempted it? After spending entirely too much money last year chasing Pick 5 payouts and essentially breaking even, I’m wondering if this might actually be easier. It seems that way but then again, maybe my average payout is optimistic or maybe my self confidence in being able to do it 25 times in a row is misplaced. Of course, all it takes is one miss and I’m back to the starting line.

Anyway, sound off. I’d love some feedback.

First Problem is

That is an AVERAGE payout which includes horses paying $20+ to show and 2.50 average implies an 80% win rate. It is highly unlikely ANY of us would include those $20+ horses while trying to maintain a streak trying to get to 25 in a row.

Second Problem is

even at 80% or .80 Win rate that is .80^25 which is multiplying .80 by itself 25 times. This gives us .00377 or 0.37% chance of completing the streak. This is 272-1 which is quite Good to get $5000 HOWEVER the First Problem comes into play as you are not going to get close to that AVERAGE. Also do we EVER really know that a horse has an 80% chance to show given each race has its own dynamics and perils.

3rd Problem

Your BETS will be increasing and that will be LOWERING and in some tracks SUBSTANTIALLY what the Show horse pays so again we are getting farther away from that 2.50 Average.

25 in a row at $2.50 Average IMO not doable in the Number of years I have left.

[moses]

Originally Posted by jms62

First Problem is

That is an AVERAGE payout which includes horses paying $20+ to show and 2.50 average implies an 80% win rate. It is highly unlikely ANY of us would include those $20+ horses while trying to maintain a streak trying to get to 25 in a row.

Second Problem is

even at 80% or .80 Win rate that is .80^25 which is multiplying .80 by itself 25 times. This gives us .00377 or 0.37% chance of completing the streak. This is 272-1 which is quite Good to get $5000 HOWEVER the First Problem comes into play as you are not going to get close to that AVERAGE. Also do we EVER really know that a horse has an 80% chance to show given each race has its own dynamics and perils.

3rd Problem

Your BETS will be increasing and that will be LOWERING and in some tracks SUBSTANTIALLY what the Show horse pays so again we are getting farther away from that 2.50 Average.

25 in a row at $2.50 Average IMO not doable in the Number of years I have left.

Sorry, I was saying my goal would averaging $2.50. I think the actual show payout average is higher than that. That said, all your points remain and are well taken.

I still think I’ll give it a try for the fun of it.