CALCULATING THE FAIR EXACTA PAYOUT.
THE PROBABILITY OF A HORSE WINNING IS (1/(ODDS+1))/ THE RACES TOTAL BOOK PERCENTAGE .
THE TOTAL BOOK PERCENTAGE FOR A TRACK WITH A 15% TAKE OUT SUMS TO ABOUT 1.18
THE PROBABILITY OF ANY HORSE WINNING IS (1/(ODDS+1))/1.18
TAG THE WIN HORSES WIN PROBABILITY WITH "A"
TAG THE PLACE HORSE WIN PROBABILITY WITH "B"
EXACTA PROBABILITY FOR A/B IS:
A X (B/(1A))
EXAMPLE: A HORSE ODDS =21, B HORSE ODDS = 31, TRACK TAKE OUT IS 15%
A HORSE WIN PROBABILITY IS (1/(2+1))/1.18 = .282
B HORSE WIN PROBABILITY IS (1/(3+1)/1.18 = .212
PROBABILITY FOR THE A/B COMBINATION IS,
.282/(.212/(1.282)) = .083
THAT EQUATES TO A $1 RETURN OF (1/.083)= 12.04
THE FAIR $1 PAYOUT IS $12.04
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A lot easier to get lucky when house takes 1.41% from the payout rather than 15% to 25%"
