Flatter: When betting Penn Derby, beware of takeout

Flatter: When betting Penn Derby, beware of takeout
Photo: Sue Kawczynski/Eclipse Sportswire

The fan in me loves the look of Saturday’s Pennsylvania Derby. It is a Grade 1 race. It is worth $1 million. It has a high-quality field, a range of racing styles and what appears to be real value on the face of it.

The cynic in me, though, sees it is at Parx Racing. In Pennsylvania. The home of high takeout.

It is like seeing that pretty shrub in the forest and then realizing it is poison oak.

Whither the Keystone State, home of the odious 36 percent rake on sports wagers and the exorbitant vig on everything from win-place-show to exacta-trifecta-superfecta.

Check out Matt Shifmans Penn Derby odds and analysis.

Two months before the COVID lockdown of 2020, Parx actually cut its notoriously high takeout – but not on everything. Just on trifecta and superfecta bets, lowering the juice from 30 to 25 percent. Pick 3s and Pick 4s had their takeout cut – or trimmed – from 26 to 25 percent.

Parx takeout held steady at 17 percent on win, place and show wagers and 20 percent on exactas and rolling doubles. Those rates are not awful when weighed against the industry curve. But the industry curve remains much worse than the long established 9 percent for a wager against the spread on a football game.

“It’s still too high,” said Dick Jerardi, the dean of turf writers in Philadelphia. “Some of the pools like the trifecta, it’s just like are you serious? It’s crazy.”

Through all that, the average daily handle at Parx still reached a record $2.64 million last year, up 29 percent from 2020 and 71 percent over 2019. If that meant the track was doing something right, Jerardi said it was scheduling.

“They scrapped Saturdays and put in a Wednesday,” he said on Horse Racing Nation’s Ron Flatter Racing Pod. “Saturdays you just can’t compete, especially in the east. There’s too many tracks. They’ve gotten a really good deal with Monday-Tuesday-Wednesdays. ... Mostly it was just due to changing a Saturday to a Wednesday.”

None of this applies to the Penn Derby, which will be run on a Saturday for the 12th time since 2010.

High takeout or not, last year’s Penn Derby day card that featured Hot Rod Charlie brought in a record $13,799,454 of handle from all sources. That was up nearly 33 percent from the old high in 2014, when California Chrome filled the joint to overflowing, got bet down to 9-10 and finished a listless sixth to Bayern.

YearPenn Derby day handleChange
2020     COVID 
2019  $8,992,775  +0.3%
2018  $8,967,264+12.1%
2017  $8,002,718 -16.8%
2016  $9,614,169+64.1%
2015  $5,859,269 -43.6%
2013  $5,519,896+12.1%
2012  $4,926,013+31.1%
2011  $3,758,481+41.6%
2010  $2,654,518+20.3%

That chart showing all-sources handle went to 2010, the first year the Penn Derby was run on a Saturday in late September instead of on its old Labor Day position on the calendar. (COVID wiped out the 2020 card.)

Did lower takeout lure all that money last year? Perhaps a clue or two could be gleaned just from the Penn Derby the last three times it was run.

Penn Derby$2 WPS$2 exacta$2 double*50¢ tri*10¢ super*$1 Pick 3
2019   $911,357$402,477$144,386$241,684$151,086$185,406
2019 to 2021     +40.0%  +67.9%     -4.0%  +76.5%  +71.8%   -40.0%
2018 to 2021     +12.9%  +10.1%     -1.1%    +2.8%     -1.5%   -20.5%
*Takeout cut 2021     

It was hard to find a clear pattern from these comparisons with 2019, when betting favorite Improbable was upset by Math Wizard, or with 2018, when McKinzie was a chalky winner.

On first glance, the 50-cent trifecta and dime superfecta soared more than 70 percent each from two years earlier, when the takeout was 5 percent higher. But there was not much change from 2018. Handle for the $1 Pick 3, which had the 1 percent tweak in takeout, was down 40 percent from 2019 and off more than 20 percent from 2018.

At the same time, the win-place-show and exacta money not only showed healthy gains last year, they easily outdid the other exotics in their gains from 2018, even though their takeout rates did not change a bit.

The fact there was no clear conclusion about the impact of lower takeout spoke volumes. It was a reminder that while horseplayers will sound off loudly on social media, in website comments and with word of mouth, we keep pushing our dollars through the windows and digital transoms with both fists.

The Jockey Club reported that handle across the U.S., Canada and Puerto Rico last year reached $12.96 billion, the highest it had been in 12 years. Even if inflation were to be factored in, 2021 was the best year for betting on the races since 2013.

All the while, the cries for lower takeout were as shrill as ever.

When the walk matches the talk, horseplayers actually are capable of being heeded. Remember the 2017 boycott at Keeneland after the track jacked up its takeout? Handle that fall dropped 8 percent. The following spring, some of those spikes in takeout were rolled back. It was the quintessential example of “money talks.”

For a given race like the Penn Derby, it is hard to see the horse-playing populace getting lathered up enough to stay completely away, especially since this is the most competitive running in recent memory.

Over the long haul, Parx might not have buried its rapacious reputation with its takeout tweaks. But it has countered that perception with some other lures for bettors.

“They introduced a jackpot wager for the first time last year with a carryover,” Jerardi said. “They had some big numbers on that. They were like astonished on mandatory days how much handle they were getting.”

Come to think of it, there was a mandatory payout on the Philly Pick 5 jackpot last year on Penn Derby day but not in 2018 or 2019. That accounted for $960,438.

Like Las Vegas and now online sports-betting platforms that offer the shiny object of parlays, from which they rake in big chunks of money, racetracks have those jackpots that may as well be turfdom’s answer to three-card monte.

“I hate those bets,” Jerardi said. “But I get why the tracks like them, because four or five times a year, they get this insane number. All the computer-assisted wagering guys come in and steal all the money that I’ve been putting into the pools, thank you very much.”

Really, it is too easy to forget about hidden costs in the middle of betting the races, especially from home. That is where the tracks start to blur into one another on a Saturday afternoon. That phenomenon brings a rich, warm, new meaning to the term “blended takeout.”

I just have to remind myself to focus on the trifecta and superfecta. Yeah, the superfecta. Just a 10-cent stake. Yeah, that’s it. Just a dime at a time – and a super computer program – and I am on my way.

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