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2021•World Scientific series in financeRequires access

Stochastic Programming and Optimization in Horserace Betting

William T. Ziemba

Open publisher page 2 citations

Abstract

This chapter discusses the stochastic optimization approach to racetrack betting pioneered by the author with the help of Donald Hausch and Mark Rubinstein and used by the professional syndicate teams in Hong Kong, the US and elsewhere. The ideas are from financial theory and portfolio theory applications. One prices the bets and then wagers intelligently on the good ones. I discuss key topics such as the importance of good mean estimates, the favorite-longshot bias, various wagers such as place and show, and the Pick 2, 3, 4, 5 and 6.

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What this paper is about

This chapter discusses the stochastic optimization approach to racetrack betting pioneered by the author with the help of Donald Hausch and Mark Rubinstein and used by the professional syndicate teams in Hong Kong, the US and elsewhere. The ideas are from financial theory and portfolio theory applications. One prices the bets and then wagers intelligently on the good ones. I discuss key topics such as the importance of good mean estimates, the favorite-longshot bias, various wagers such as place and show, and the Pick 2, 3, 4, 5 and 6.

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OpenAlex reports 2 citations for this work. Citation counts describe recorded attention and do not establish research quality.

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Available abstract

This chapter discusses the stochastic optimization approach to racetrack betting pioneered by the author with the help of Donald Hausch and Mark Rubinstein and used by the professional syndicate teams in Hong Kong, the US and elsewhere. The ideas are from financial theory and portfolio theory applications. One prices the bets and then wagers intelligently on the good ones. I discuss key topics such as the importance of good mean estimates, the favorite-longshot bias, various wagers such as place and show, and the Pick 2, 3, 4, 5 and 6.

Key concepts: Computer science, Stochastic programming, Mathematical optimization, Mathematics

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