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What is fixed-odds betting in horse racing?

Fixed-odds wagering is the newest old thing in horse racing in the U.S. (New Jersey horse betting sites: Poinstbet, TVG), though it’s quite popular in Australia and to a lesser extent in Europe and the U.K. (William Hill, bet365 and other sites).

In fixed-odds horse betting, a third party (i.e., the bookmaker) sets the odds rather than the betting public, as occurs in pari-mutuel wagering. It’s the way that people bet on horse races before the parimutuel system began to take over in the early 1900s.

The benefits of fixed-odds betting are twofold for the player: It allows a punter to lock in odds at a fair price without having to worry about the late money ruining the payoff, because big bettors and syndicates are no longer incentivized to wait until the last moment to wager. Second, bettors can lock in a bet at higher odds than the final odds in the parimutuel pool, which is more efficient at determining accurate odds than any bookmaker.