Playing To Win

Calculating Place Payoffs - Step by Step

Let's assume #1 and #4 run first and second. The order does not matter.

1. First the tax is taken out. Let's assume it is 16%.
   1. Multiply the tax by the total pool. $20,000 x 16% = $3,200.
   2. Subtract the tax from the total pool. $20,000 - $3,200 = $16,800.
2. Subtract the money to pay winners their $2 back.
   1. Add the winning place bets, $2,317 (bet on #1) + $6,855 (bet on #4) = $9,172
   2. Subtract $9,172 from the remaining money. $16,800 - $9,172 = $7,628
3. Split the remaining money equally between both horses.
   1. $7,628 / 2 = $3,814 for each horse
4. Allocate the winning money for each horse to the dollars bet
   1. For #1:
      1. Divide $3,814 by the $2,317 bet on #1 = $1.64. This is the winnings odds for a $1 payoff.
      2. Next, we multiply $1.64 by 2 to get a $2 payoff. $1.64 x 2 = $3.29.
      3. Next, we add back the original $2 bet. $3.29 + $2 = $5.29.
      4. Finally, the payoff is rounded down to the nearest 20 cents, to get $5.20.
   2. For #4:
      1. Divide $3,814 by the 6,855 bet on #1 = $0.56. This is the winnings odds for a $1 payoff.
      2. Next, we multiply $0.55 by 2 to get a $2 payoff. $0.55 x 2 = $1.11.
      3. Next, we add back the original $2 bet. $1.11 + $2 = $3.11.
      4. Finally, the payoff is rounded down to the nearest 20 cents, to get $3.00.

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Topics

• Intro
• Calculating payoffs
• Payoff Outcomes