By Robbie Butler,

Following on from our successful workshop last week on sports betting, it is rather appropriate that we re-start our blog with the traditional Galway Races exercise that puts the Fama's Efficient Market Hypothesis (EMH) to the test.

Last year we branched out and followed two leading trainers. A profit of more than 31% was reported for Willie Mullins, but Dermot Weld followers would have incurred a loss. As this is our 6th attempt, and with last years draw, the scorelines stands at 1.5 - 3.5, in favour of the bookies. Not deterred, we go again this evening, and for the next six days. 

The rules are as follows. A hypothetical stake of €2 (to win) will be wagered on on all Weld and Mullins trained runners shorter than 4/1, and €1 each way on all those 4/1 or greater. Guaranteed prices are assumed. The trainers will be evaluated separately. 

Updates during the week will follow.

2018 is not a year to forget quickly. An excellent return is reported. In total, 156 horses were wagered on. Mullins saddled 112 and Weld 44.

​Following both trainers resulted in a profit of €56.32 for a €2 stake per horse. That's a 36.1% return. Things were even better for Mullins alone, with a reported profit of €71.52 for a €2 stake. This is a massive 63.9% return! 

By Robbie Butler

There are presently 86 racing courses operating in the United Kingdom (UK) and Ireland, or British Isles to use the geographic terminology. The breakdown by country is England (52), Ireland (24), Scotland (5), Wales (3) and Northern Ireland (2). Racing at these locations is an all year round occurrence, with only Christmas Day and Christmas Eve in the UK certain to have no fixtures each year.

The regularity of the sport ensures a constant stream of live content for sports broadcasters. Traditionally available on free-to-air television and within bookmaker betting shops, the market for live content changed in the early 2000s with the arrival of subscription channels. Much like the market for Premier League football a number of broadcasters now exist and “compete” with one another.

As Hoehn and Lancefield (2003) identify, completion occurs in a two-stage game; the first stage involves competing for rights to the race courses, if rights are non-exclusive or face close substitutes, broadcasters compete in respect of the quality of their coverage and analysis. The second is competition in the downstream market for consumers.

In the UK, there are two main racecourse owners. Arc Racing Company and Jockey Club. Between the two they control almost half of all British race courses. The remainder are owned independently.

Ireland is somewhat different. Horse Race Ireland (HRI), a government financed government body, manages the sport on an all-island basis with the two tracks in Northern Ireland directed from Co. Kildare. While ownership of the courses is largely private, direction, fixtures and the vast majority of funding comes from HRI.

Racing is available on free-to-air channels in the UK and Ireland on a weekly basis. That said,  the number of races shown is limited and coverage is normally restricted to a Saturday. Remaining races can be viewed on a subscription basis by purchasing one of two channels; Attheraces (to be rebranded Sky Sports Racing from on or before January 1st, 2019) and Racing UK.
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As on May 2018 Attheraces has the rights to all 15 Arena Racing Company, Hereford Racecourse (run by the local council), a number of independent tracks and all 26 race course on the island of Ireland. Racing UK holds the rights all 14 Jockey Club tracks, two run by Chester Race Company and numerous independent course.

Things are set to change however as it was recently announced the Racing UK had won the rights to show all racing from Ireland from 2019 onwards. While Sky Sports Racing recently announced an agreement to take over broadcasting of live races from Chester Race Company’s course in Bangor-on-Dee and Chester, the loss of 26 courses will be seen as a major blow. The graphic above demonstrates the change in market power from 2018 to 2019 for both channels.
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Attheraces coverage of Irish racing has been excellent over the past decade or more. It will be interesting to see how the move to Racing UK (which may now require rebranding) works out.

By Robbie Butler

This week we had the privilege of addressing the University of Liverpool's MBA in horse racing class on Merseyside. We had a good conversation about many racing issues, particularly the tendency for Irish horses to travel to the UK in large volumes but a much smaller flow of traffic the other ways across the Irish sea.

In many respects this is unusual given the prize money on offer in Ireland. I have previously addressed this here and here. With Punchestown's Festival in full flow this week it is notable that there are far fewer English horses running in Ireland than Irish trained horses as the English equivalent - The Cheltenham Festival. Prize money however might answer this.

Four years ago I addressed this issue, and while prize money in Ireland tends to be better on average than the UK, the same cannot be said when comparing Punchestown to Cheltenham. Below I compare the various races, which match up quite well across both festivals, and the corresponding prize money. Just one, the Champion Bumper, has larger prize money in Ireland than the UK. 

Cheltenham continues to dominate in terms of the money on offer and therefore it is no wonder the flow of horses tends to be from these shores to the Cotswolds rather than the other way around. 

By David Butler

To my knowledge a new record was set at Southwell Racecourse last Friday when just 13 paying customers arrived at the track. The bitter cold and schedule reorganisation were offered as reasons for the surely record breaking turnout.  

The data on attendance at UK meetings from 1989 to 2015 shows that prior to Southwell last Friday, the previous lowest attendance was at Wolverhampton in December 2012. This meeting was held three days before Christmas – 111 showed up and only 5 bookmakers were present on course.

From 1989 to 2015, 952 UK meetings have attracted below 500 punters. The data shows that 644 (67%) of these were held at Wolverhampton racetrack. Southwell held the second highest percentage of meetings with under 500 attendees - 123 meetings (19%). Along with Lingfield, these meetings at these tracks appear to be designed for bookmakers shops and off-course bettors rather than racegoers. It is also the case that the vast majority of races run at these tracks are on an all-weather surface. Wolverhampton Racecourse only hosts all-weather events on its recently installed Tapeta surface.

The weather, and perhaps the Christmas season, appear to be important regulators for meetings in this <500 club too. The chart below shows the data by month for the 952 meetings. Typically, these events fall into months with adverse weather conditions. While not denying the importance of race quality and facilitates,, this might be something authorities need to consider more when organising the racing calendar to help smaller racetracks improve attendances. That is of course, if the motivation is to attract greater attendances.

By Robbie Butler

A number of weeks ago the Irish Labour Court rejected an appeal by Ballydoyle Racing Stables, which attempted to prevent changes to the categorisation of its employees. The stable's failure in the Labour Court could have a significant impact on horse racing in this country.

For those unfamiliar with the case here is a brief summary.

Employees of the horse racing industry in Ireland have historically been deemed to be “agricultural workers”. According to 2010 Employee Regulation Order covering this sector, an agricultural worker is defined as:

       “a person employed under a contract of service or apprenticeship whose work under the contract is or includes              work in agriculture, but does not mean a person whose work under such contract is mainly domestic service”.

Importantly, this means that such workers can be asked to engage in:

​      “a wide variety of activities, which are weather dependant, seasonal, unpredictable and often require 7 day week         flexible working arrangements”.

In 2015, the Irish Workplace Relations Commission (WRC) changed legislation covering the horse racing industry so that employees were no longer classified as “agricultural workers”. This has had serious consequences for the number of hours and days employees could be asked to work without a break.

On a routine inspect of Ballydoyle stables, the home of many world famous Aidan O’Brien trained horses in May 2016, the WRC found the employers to be in breach of the law. Ballydoyle’s failure to overturn the ruling in the Labour Court has left the industry at a crossroads. A further appeal to the High Court is possible, and if successful, could result in a return to the status quo.

It is worth pointing out that the definition of “Agriculture” under the 2010 Order is as follows:

““Agriculture” means horticulture, the production of any consumable produce, which is grown for sale or for consumption or other use, dairy farming, poultry farming, the use of land as grazing, meadow or pasture land or orchard or osier land or woodland, or for market gardens, private gardens, nursery grounds or sports grounds, the caring for or the rearing or training of animals and any other incidental activities connected with agriculture”.

It is also worth pointing out, that Irish Government support for the horse racing industry has, since 2011, been provided by the Department of Agriculture. 

By Robbie Butler

In recent days, English trainer Nicky Henderson has come in for criticism for his alleged delay in informing the public of the setback that star chaser Altior had in preparation for the upcoming Tingle Creek Chase at Sandown.

This central issue, and the main source of this criticism, concerns the integrity of the ante-post betting market. For those unfamiliar with horse racing, ante-post markets allow one to bet on a race in the weeks and months prior. Larger prices are offer but these are offset by the greater level of risk. If a horse fails to run, money is not returned. This is not the same as betting on the day of a race, where punters are refunded for non-runners.

The issue of non-runners appears to becoming a matter of debate with some questioning the timing of these. The Turf Club in Ireland produce some excellent data, available online, which sheds light on non-runners in Ireland. The most recent publication covers the 2012-2016 period.

The number of non-runners in Ireland has decreased over the past five years. 2,126 non-runners were reported in 2012 compared to just 1,863 in 2016. This is slightly up on the previous year when 1,607 horses failed to run after being declared.

Some of the drop can be put down a decline in the number of horses in training. However, given a total number of runners over the past 5 years, the percentage of non-runners is relatively stable between 6% and 7%. Ireland it seems does not have a major issue on this front.

The reason for declaring a non-runner is also provided. Almost 40% are down to ground conditions. Lameness is the next more common reason for withdrawal with between 9.8% and 17.4% of horses not running for this reason. Coughing and stone bruises account for around 10% each respectively. The remaining 30% are down to variety of other reasons such as a temperature, being off-feed or injured.

The full document and data can be found here. 

By Robbie Butler

You know it's summer in Ireland when Galway Race week starts. The seven-day Fesitval is by far the biggest event on the Irish racing calendar. Horse Racing Ireland's 2016 Factbook reports that almost 150,000 people attend the festival last summer. This is more than 30,000 greater than the 2nd placed Punchestown Festival.  

Since we started this blog is has been tradition to use the week long Festival to test Fama's Efficient Market Hypothesis (EMH) to the test.
 
As said previously Eugene Fama published a groundbreaking article in May 1970 called the "Efficient Capital Markets: A Review of Theory and Empirical Work", and conceptualized the idea of the efficient market hypothesis. Put simply, he concluded that 'the house always wins', thus we can't systematically beat the bookies. 

For the fifth year in a row we will be putting this to the test by following leading Irish trainer Dermot Weld. It should be noted, the county Kildare trainer's success has declined in recent years. This culminated in Weld's failure to win the 2016 champion trainer award at the Galway Fesitval. Willie Mullins took the award, denying Dermot Weld a 19th-straight championship. With this in mind, we will also follow Mullins trained horse to see if either can 'beat the market'. 

The scoreline currently reads Bookies 3 - 1 Followers. Success in 2013 was followed by losses in 2014, 2015 and 2016.The rule are as follows. A hypothetical stake of €2 (to win) will be wagered on on all Weld and Mullins trained runners shorter than 4/1, and €1 each way on all those 4/1 or greater. Guaranteed prices are assumed. The trainers will be evaluated separately. 

Updates during the week will follow.

The daily updates confirm the shift in power from Weld to Mullins. 

In total, Carlow based Mullins' saddled 46 horses. A total stake of €92 would have yielded a return of €120.53. That's a 31% profit on the week. 

Weld sent 22 horses to post. In his defence, a recent virus has swept the yard which did not help his efforts this year. A total stake of €44 yielded a net loss of €15.37. 

By Robbie Butler

RTÉ's Conor McMorrow has written a fascinating piece about the potential impact Brexit could have on the Irish horse racing industry. He cites Horse Racing Ireland Chief Executive Brian Kavanagh who says Brexit is a "huge concern" for the industry on the island of Ireland.

The piece suggests the industry supports 14,000 jobs, attracts more than 80,000 international visitors and is worth €1 billions to the economy. The all-island nature of the sport of kings means it is exposed more than most to the effects of Brexit, as is Ireland's multi-million euro bloodstock industry, with 65% of all horses exported to the UK.

The full piece can be read here and includes comments from top trainer Dermot Weld.

By Robbie Butler

As is normal for this week of the year, we turn our attention to Cheltenham. Over the past three years, I and others on this blog, have attempted to beat the market, with varying levels of success.

Since 2009 my record stands 3-5. Hopefully 2017 will make it 4-5.

In the past I have attempted to beat the market by selecting my own picks, following the favourite, and backing Willie Mullins and Ruby Walsh ridden horses.

My colleague John Considine has asked me to return to my picks for this year. I have obliged and will do my best.

Daily updates to follow. 

Day 2:

Desperately unlucky on Day 1. Singlefarmpayment was beaten a nose and would have put us ahead for the week. Footpad finished 4th at 18-1 missing each-way money, while Edwulf looked certain to finish second jumping the last only to sadly break down in the final 200 yards.

It will be hard to turn this around now but picks for today are below.

• Shattered Love €1 each way
• Automated €1 each way
• Bless The Wings €1 each way
• Next Destination €1 each way

​Total stake €8.

An improvement on Day 2. Another day for the bookies but Bless the Wings and Next Destination collected each way money resulting in a return of €7, which almost covers the stake on the day. More required however. Day 3 selections below.

• Golden Doyen €1 each way
• Nichols Canyon €1 each way
• Thomas Crapper €1 each way
• Mall Dini €1 each way

Total Stake €8.

A very successful Day 3. Nichols Canyon won and Thomas Crapper took each way money. A return of €19.40 on the day has us slightly ahead for the week.
Picks for today below.

• Bapaume €1 each way
• Death Duty €2 win
• Dell Arca €1 each way
• Dodging Bullets €1 each way.

Just Bapaume collected on Day 4, finishing 3rd in the opener. This resulted in a return of €3 but a lost on the day.

Total Stake €8.​

Results

Stake for the Week €34.
Return for the Week ​€29.40.

Another win for the market. 

By Robbie Butler,

Discrimination in sport is sadly something we are all too familiar with. This can take many guises and is based on nationality, ethnicity, gender, sexual orientation, religious beliefs, etc. One of the most high-profile campaigns to rid soccer of one such form of discrimination is FIFA's "No to Racism". Lionel Messi, Cristiano Ronaldo, Gareth Bale and others ask football supporters to say "no" to this form of discrimination.

Another prominent aspect of discrimination in sport is based on gender and comes in the form of pay differentials. Scraton and Flintoff (2002) provide an excellent overview of the theory of gender in sport, and its evolution from Victorian Britain to the millennium. Today this battle is being fought by the United States women's soccer team. The national side have filed a complaint with the US Federal Equal Employment Opportunity Commission on the basis that their pay is far below their less successful male counterparts. The story is covered in more detail here, here and here. 

While the issues cited above are primarily thought of as 'negative' discrimination, the issue of affirmative action or positive discrimination in sport arose last week. This is much less prevalent but can be seen by the decision of France Galop to introduce a 2kg (4.4lbs) weight allowance to all female riders in the vast majority of French horse races. Jean-Pierre Colombu, vice president of France Galop, has described the move as "a real opportunity" for female jockeys.

Such allowances are not unheard of in racing. For example, apprentice jockeys receive weight allowances based on the number of winners they have had. Gender is not the criteria however. Success is. Gender discrimination does exist in the sport, but for the horses, with mares receiving a weight allowance. Superb mare Annie Power exploited this to maximum effect last March when she became the first mare since Flakey Dove in 1994 to win the Cheltenham Champion Hurdle. 

While some have welcomed the move, the majority of those that have voiced opinions are not impressed. Champion Apprentice jockey Josephine Gordon has said "I think an allowance would give a lot more females more opportunities to get rides at lower weights, but personally, I find it a bit offensive". Leading jockey Adam Kirby has described the move as ridiculous and suggests such a move would be "too much" of an advantage, as race riding is "not about strength [but] positioning, [and] rhythm." Others have suggested, female jockeys should accept the allowance and use it to their advantage.

One need only watch the likes of Hayley Turner (previously), Josophine Gordon, Nina Carberry, Katie Walsh, Rachael Blackmore, Lizze Kelly (the list goes one), to realise they need no such advantage. More importantly, they want no such advantage. If sport is to be rid of discrimination, positive or negative,  everyone must be treated the same, regardless of gender, nationality, ethnicity, etc.