Horse racing is responsible for bringing in in some of the largest wagers at online sports betting sites in New Zealand. The reason horse racing is so popular with punters is because there are various different bets that can be placed on each race, and there are multiple races held at every meet. This adds up to multiple wagering opportunities, competitive odds and plenty of markets to choose from.
In the world of horse racing, there are two very different types of options that sportsbooks might offer. The first is fixed odds, and the second is tote. Most punters will be familiar with fixed odds as this the majority wagering style used on all the major sports, including Rugby, Cricket, Soccer, Tennis, and Basketball. Tote betting on the other hand, is usually reserved for horse racing but can be used for just about any racing sport.
Tote, otherwise known as parimutuel or pool wagering differs from fixed odds in that punters do not actually know how much they stand to win until all the wagers have closed and the race is being run. With fixed wagers, the price is agreed on at the start of the punt and the sportsbook pays out even if the odds shift at a later date.
These punts are best understood when they are looked at as a pool - hence the nickname. This is because all the bets on the particular race go into one central pool, which then determines the total prize money and how much the winners are paid out.
Let’s take a look at a simple example. If the total of all stake money placed on a single race adds up to $12.000, this is then this is the prize pool. The online or mobile sports betting site then takes a deduction for hosting the process. This differs from site to site but is usually around 15%.
Calculating the Payouts
The amount remaining is $10 200. (12 000 – 15%). After the race is run, the payout amounts can be split according to how much was wagered on the winner. If just $600 was wagered on the winner, the prize pool of $10 200 is divided by the winner’s amount of $600 to get a return of 17.00. This means that for every $1 a punter placed on the winning horse, they would receive a payout of $17. Thus, if a punter placed $50 they would receive a total payout of $850. This same formula is used when calculating payouts for second and third place, as well as multiple and prop bets.
Why Tote Betting Works
With this type of wagering, the exact odds of each punt are unknown and the payout is unknown until the race has actually been completed. Only then can the bookmaker do the calculations on how many people placed wagers on the winner, versus the amount of people who wagered on the race in total.
In New Zealand, the best sports betting brands all offer tote punting on horse racing, as well as fixed odds. With fixed wagers, the payout is known at the start but sometimes, parimutuel options offer more for the same type of bet, so it can be a very lucrative option for punters who are keen to take a chance.