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Mark Cramer's C & X Report for the HandicappingEdge.Com.
Wednesday, May 18, 2005
A Note on C&X #20. The hard copy will be in the mail next week. We continued to get error messages when trying to post #20 so there are about five pages missing here.
C&X #20
CONTENTS
Editorial
On Being Selective, Lessons from French Racing
Creative but Critical Thinking
The Big Win Method: Revisited
Kentucky Derby Reflections
Optical Illusions
C&X Caf?
EDITORIAL
Thank you for your patience in awaiting this issue. Each year I spend countless hours preparing for a single race that lasts a few ticks more than two minutes, and I usually crash right after the race, and sometimes before. Win or lose, it?s a draining thing, and philosophically it seems out of proportion, given that one should be able to handicap a 20-horse field in one hour instead of twenty. No doubt next year I will do it all over again.
Sometimes the preparation lasts for years, and is not for any particular Kentucky Derby but for the special one that eventually comes along, as was the case this year for C&X reader Dr. Billy.
Knowing the Derby would be a few days after the publication deadline, I had blocked out this issue of C&X with spaces within each article for illustrations from Derby day. It would have been senseless to publish a more abstract version of the same articles you see here, just to get it done a week earlier.
Within this issue you will become aware of why I am trying to transform C&X into a more interactive publication, in order to benefit from the unsung heroes among the C&X readership, and to truly do what we say in our respect for ?the informed minority?.
Years ago, in a public forum, I was asked about the chances of a particular horse to win a race. Some of you may remember the horse. His name was Truxton?s Double. I told the group that if Truxton?s Double won this race, I?d invite them all to lunch.
Needless to say, the horse won.
As an accomplished student of this game, I have learned to be humble. When I?m in public meetings or forums on non-racing subjects, I often hear people get up and spout off unmeasurable and unverifiable opinions as if such views were engraved in holy tablets. If the unfounded convictions get too outlandish, I?ll stand up and warn the audience that such absolute resolve is not warranted, and that people who express themselves in certainties should try reading a racing form and wagering on their convictions.
The past performances provide us with a great advantage in the search for the meaning of life, for studious horseplayers know that nothing is as simple as it seems.
ON BEING SELECTIVE: LESSONS FROM FRENCH RACING
Like any financial market, horse betting is very much a game of knowledge. We need to know something that the betting public does not know or underestimates. I have learned things from French racing that tell me what I need to know, should know or don?t know about American races. This has helped me know, in American racing, when to bet and when to pass. These are things I probably would not have realized had I not experienced the French racing game, through the publication called Paris-Turf.
The lesson came to me thanks to the format. In order to keep down the price of it?s publication, Paris-Turf publishes limited past performaces for every race but the featured national wager: the Quint? (formerly the Tierc?). In this race, which is broadcast on national TV from 20-to-30 minutes each day, one has the choice to make normal bets or to do lottery-style wagers in which you need to pick the top three in order (tierc?), the top four (quart?), or the top five (quint?). There are consolation payoffs if you get the right horses in the wrong order. The quint? payoffs rival or exceed pick 6 payoffs. That?s because the smallest field is 14 horses and the field could be as large as 20.
In order to protect the reputation and status of this bet, the Paris-Turf, as well as various spin-off publications, print an interview with the trainer (or sometimes the jockey) of each horse. This spokesperson must state, with the utmost honesty, where the horse is in his performance cycle, what the expectations are for the race, why the horse is entered in this particular spot, the horse?s recent health conditions, and other particulars that might affect the horse?s performance. Most of the trainers are remarkably frank, saying things like: ?My horse needs two or three more races to reach his peak?; ?I don?t like the spot, but my horse couldn?t get into another race and needs the prep?; ?Sure my horse is coming back after a layoff, but rest assured that he?s worked in company and is well prepared to fire fresh?.
In this feature race, but not for the other races, the Paris-Turf includes back races in the past performances if they happen to be the same track, distance and surface. So, if you normally have only seven or eight pp races for each horse, the seventh or eighth lines down might be the horse?s 11th or 13th race back, because those lines illustrate the horse?s performance in a situation that mimics today?s race. I?ve collected several times on longshots because I discovered, thanks to this information digging that was done for me, that the horse today was shipping to a rider who won with him at 20-1, or to the track/distance of his last victory. It?s excellent formate for uncovering pattern matches that might not appear in American pps.
With the wealth of information in the quint? races, and the paucity of data for the others, I had a built-in rationale for which races to play. To the quint? race I add stakes races to my betting portfolio. The front and back pages of Paris-Turf often have in-depth trainer interviews which deal with the same type of information that you see for the quint? races. So without having to be discerning, I automatically knew which races to play: the quint? races and Grade I events. I?ll play another type of race if some information from the above formats has been retained and can be recycled.
Transferring this knowledge
I have learned to treat American races in the same way I treat French races. If the information in the DRF past performances is not enough to deduce the trainer intention, or if the pattern match I need to know about is not available in the ten listed pps but might be deeper down, I simply pass the race. Trainer stats at the bottom of the pps sometimes allow me to glean what I need to know. Horse-for-course info at the upper right hand may or may not tell me what I want to know. What would happens if a horse is 2-for-3 at today?s track and is going for 40,000 today. If I don?t see those races in the running lines, then I have no idea of those two wins were at 50,000 or at 16,000. That makes a big difference. When the Paris-Turf digs back to a comparable race, I discover whether it was a cheap race over the course or one that is equivalent to today?s class, and I also discover the condition of the course.
I recall an American turf bet I made because I had discovered a dirt-to-turf play at a high level claiming event. The horse had raced twice on the grass and was 0-for-2. Thinking the way I read the French pps, I was curious to see those two losses, and I was able to trace the information. It turned out that both losing efforts came from outside posts in stakes races, and the horse had been competitive. In fact, reading the way he ran those two races, I could conclude that he was a horse-for-surface, the opposite of what his 0-for-2 grass record implied.
For trainer intentions, I comb the inside pages of the racing form. In some cases I?m able to put together a collage of the trainer?s opinions about his particular horses. The narrative from the inner pages of the DRF is just as important as the pps, especially since many players don?t read such articles.
In the end, my experience with the French quint? pps has helped me to filter out those American races that I could have only been played with insufficient knowldge.
So you may ask, have I ever hit a quint?. The answer is that I?ve never played one. I use the quint? pps, but I play the non-lottery bets. I use those pps to play straight win, quinellas and the multi, a bet in which you need to pick the top four, in any order.
CREATIVE BUT CRITICAL THINKING
I ask your patience, as I make a desperate attempt to shake things up and trigger a positive change in our handicapping and betting habits. I have been advised that its virtually impossible to teach people to be critical and creative thinkers at the same time. I stubbornly resist such a cynical view of humankind, knowing all the while that my own critical creativity has its flaws.
Creativity is not enough. A pure artist can find arguments in favor of 99-1 horses that have no chance.
?He?s had trouble in his last nine races!?
?After the expected double bounce, he?s ready for a new career top!?
?She has matriarchal breeding, so she?ll really improve now that she?s running against the boys.?
?Her pattern has been ?fast workout-slow race?, and now suddenly she has a slow workout, so it points to a fast race.?
Creativity needs to be accompanied by critical thinking.
The creative handicapper is willing to consider any horse and doesn?t prematurely eliminate horses for one-dimensional reasons (the way I eliminated Closing Argument). Once liberated from an overly rigid process of eliminating horses, he then uses critical thinking to find out whether there is a connection between the creative hypothesis and objective reality.
The above four superficial reasons for liking a horse can be contrasted with four more nuanced opinions:
?He?s had trouble in his last nine races because he?s a need-to-lead horse that?s uncomfortable in a crowd, and for the first time since his last win, he actually charts to grab the lead.?
?The double bounce was expected since the horse had been entered at the wrong distance/class level/surface when the races he was targeted for did not fill.?
?She?ll improve now that she?s running against the boys because this year?s crop of fillies and mares has been racing faster than the boys at the same level.?
?The horse has been working sharply but has been losing the will to compete because the class of horses he?s confronted has been too steep. Today they?re dropping him as a confidence booster. Since he already showed early speed against better in his race 9 days ago, he only needed a gallop for this one.?
The best example of such creative-but-critical thinking comes from Jon?s ideas on Closing Argument, which you saw on the C&X website, and from Mitch on Giacomo (see Derby notes below). Mitch?s reasoning goes hand in hand with my above examples.
The first group of four opinions was based on unbridled creativity, which is not all that bad in the first stage of handicapping, when many uncreative handicappers prematurely eliminate horses. But for the next stage, critical thinking takes over, and what everpatterns have been identified must be connected to objective information.
This is the process, but as you all know, it?s more complicated than that.
That?s why handicapping is fun.
The question I will ask is whether or not you can draw out natural creativity and critical thinking that is chained within the human mind. We?re talking about exercising neurons. It?s much like physical exercise. It requires energy and discipline.
A few days ago, one of the greatest people I?ve ever known informed me that he had signed up for a couple of tout services. This is a young man, though he is in his eighties. I have heard him analyze races and I know that he?s sharp enough to win on his own. He?s read the best authors and learned a lot over the years. When he has won, I have rejoiced. So for me, it was a setback to hear the tout story.
Murphy?s Law of Touts
Murphy?s Law is based on scientific proof. For example, it?s no coincidence that a fallen piece of toast almost always lands on the buttered side. I?ve done this experiment before audiences, using a various sizes a flat material, placing them face up on a table, and then pushing them over the edge. More than 90 percent of the time, they land face down ... because there?s only enough space between table and floor for one turnaround.
In horse racing, the Law of Touts is simple. Sign up for a month?s service and the one day you don?t call will be the one in which the tout gives out a $66 winner. I have enough research to prove this Law is valid. There are good touts and bad touts. Either way, you cannot win with them.
Murphy?s Second Law of touts explains that the time when you play the tout?s horse, your horse will win the race. But the time you play your horse, the tout?s horse will win.
Some touts are not bad guys. They want very much for you to win, because then you?ll sign up again. I worked for one tout who was more desperate than the players themselves.
?Cramer, I need a winner today or they?re not gonna call me tomorrow.?
?But B,? I said. ?I just gave you a $20 winner. I could have five or six straight losers and your clients would still be ahead.?
?That?s what you think!? he responded. ?What about the ones who didn?t call me the day you had the winner? What about the ones who wheeled him in the exacta and the favorite finished second? What about the ones who bet less on him because your pick lost the day before??
Dependency and liberation
Using other people to determine your decisions is debilitating. That?s not to say it cannot be a valid way of doing things. For example, if you are a brilliant handicapper and a willing to invest $48 on a pick 6 ticket, you?d do better to be a silent partner with one percent of a $4,800 ticket designed by another handicapper of good repute.
But that?s for situations of leverage, like mutual funds. And even mutual fund managers, the touts of the stock market, most often perform worse than the S & P index. Still, you get leverage with mutual funds, and it?s worth it.
But for straight betting on horses or anything else pari-mutuel, touts are a viscious circle, creating spiraling dependency in the horseplayer mentality. As dependency creeps into the mind, it takes over the space that should be occupied by liberating creativity. The more you want others to help you analyze and make decisions, the less you can think for yourself. The more you depend on others, the less you will be able to identify when another handicapper is providing you with a valuable piece of information of analysis. Knowing how to listen to and identify meaningful opinions that can be categorized as ?minority wisdom? and can become an important part of our decision making.
Can creative-plus-critical thinking be learned?
Handicapping and investment decision making is successful only to the extent that it can combine objective-analytical thinking with intuitive reasoning. There?s a metaphor that has come into style: thinking outside the box. To do this we have to understand that the box is made up of a set up limitations that our culture and pedagogical heritage has sewn into our neurons. Education is all about conditioning people to fit in. That?s how Horace Mann convinced the elite to finance public education ... by presenting it as a type of social control. Of course, private education is no less controlling.
By the time we get out of elementary school, we?ve accumulated a set of rules that control our thinking. This is not the fault of teachers, but the structure they work in and the constraints they face. How can teachers compete for the attention of children against high power professional sports, commercial TV, and an all-absorbing celebrity industry. How can young people learn about critical thinking, which comes from philosophers, when in our society, the only public philosphers are celebrities. Last time I was in a high school, philosphy was not a required course.
The discipline of philosophy would be a great help for reading the past performances. I was fortunate, in a haphazard way, to encounter philosophers in my youth who taught me critical thinking. There was, for example, Jean Sheppard, on the radio. (Excuse me if the spelling is wrong. Never actually saw his name in writing.) TV has not lent itself to philosophy. While TV was promoting icons, as visual media must, the radio offered a few spots on the dial where I could be exposed to iconoclasts like ?Bob and Ray?.
In elementary school I was taught to conform. Luckily I did not have credible teachers. (One of my teachers was nicknamed like ?the Atom Bomb?, but no matter how hard she crushed us, we never succumbed to her authoritarianism.) Luckily there were people like Jean Sheppard on the radio who gave us alternative perspectives to consider.
First, the good news
My own re-education continued with certain articles in racing publications such as American Turf Monthly and books by Tom Ainslie. It leaped forward with James Quinn?s The Handicapper?s Condition Book and Betting Thoroughbreds by Steve Davidowitz. The work of Andrew Beyer played resides in his critical thinking and his writing style. When I read Beyer, I was reading accomplished and spirited literature.
These and other writers taught me how to give critical structure to creative ideas. These guys were not telling me to be dependent on them. They were telling me that I should be thinking for myself, and they were giving me tools to do so.
But that?s not enough. When we make a pari-mutuel wager, we are betting against other people who have also learned to think critically and creatively. This is why horse betting is such a tough game.
I sometimes read fine publications such as Scientic American and Popular Science and I am struck by how well horse race handicapping complexity stands up well in the context of modern science. We are in a very enriched environment, and for this reason, it?s so hard to outsmart the people around us.
As with most financial markets, it?s less the performance of horses ... and more the inefficiencies of our handicapping rivals that we need to exploit. Human psychology is at the center of this game, because it helps determine the odds.
Once you understand this, you can learn that creative-plus-critical thinking will not serve us in every race. You can see this by noting that handicappers of undeniable talent such as Dave Litfin, Brad Free and Nick Kling (I could use other examples) can come up with different picks for the same race! How is this possible? These guys really know what they?re doing. If we could only be on a par with these guys, then we?d still be wrong more than we are right.
I have spoken to Free and Litfin on this subject, and both have communicated the same lesson. Over the years they have learned to play fewer and fewer races. This is a type of wisdom they have acquired, when they have learned, as we need to learn, that there are built-in limitations in this game and in order for us to overcome such limitations, we need to structure our handicapping and betting to such an extent that we enter less into hopeless box canyons of the mind.
So a third dimension is added to the process: creativity-critical thinking-structure. Recently I read an article about engineering design. It was called ?Voodoo Engineering?. It was a critique against a professor who wanted to transform engineering into a science of axioms, laws and equations, as if you could desynthesize the process that led to the creation of the Concorde airplane into piles of scrap. The author makes the point that creative trial-and-error went into the development of a viable design. In the conception stage, was pure fancy was considered. It was like Brancusi?s ?Bird in Flight?, the most expensive auctioned sculpture in history.
But then, the engineers knew that they had to make it work, and structured critical thinking was imposed on their fancies. Discipline was essential. The plane had to fly.
For our handicapping to soar, we need to put things together in this way. We need to begin with a liberated mind. A tout?s picks are constraining. I suppose that a tout whose purpose is to liberate the mind is no longer a tout.
We now come back to the original question. Can we learn to be creative-critical-disciplined. Of course we can. If each time you opened up the pps you reminded yourself of these three parts of the process, you would automatically be in a better position to handicap the race effectively.
But you need to ask yourself why you are doing this. If it is purely for the action, then the process will break down.
THE BIG WIN METHOD: REVISITED
I never did include the Big Win method in the C&X Crib Sheet (in a later issue we?ll do a quick summary of the Crib Sheet for newer readers). The problem was that I kept receiving contradictory samples. There were some samples that corroborated the original profitable findings and other samples that were warning signs with negative returns on investment.
But now, I think I?ve found a constraint in the original research design, and eliminating this constraint should add value to the concept.
To summarize the original rules, we?re looking for dominating horses, and for research purposes we set the bar at 5-lengths: horse must have won its last race by five lengths or more. Two exclusions follow. If the big win was on a wet track (wet-fast, sloppy, muddy, etc.) or if it came in a maiden claiming race, then it does not count. Reason: these two types of race scenarios often have fields in which only one or two horses has any possible chance. The wet race might have a field of horses that hate the going, and the maiden claimer might have a bunch of proven losers in the field. We?re more likely to see a strung-out finish in these categories of races.
The new perspective is likely to add a dimension to the method. (a) If the big win occurs in running lines other than the most recent, then this factor becomes less obvious to the public and therefore more valuable. (b) Horses showing multiple big wins are especially potent contenders.
Let?s examine this wider view of the Big Win Method. I?ll use the pps from the Kentucky Derby prep races, since you are likely to have copies of these and we do not lose page space reprinting them.
Santa Anita Derby
In that field, three horses showed big wins in their pps. Giacomo had a big win, by 10, in his maiden win, fifth race back. Don?t Get Mad also showed a big win as a first-time starter, four races back, but that 6-length victory was over a sloppy strip. Finally there was General John B. He had a big win two races back, by 6 lengths, but it was on a track labeled ?muddy?. But this was his second big win! He also showed a big win as a debut horse at Calder, six races back, winning by 8 on a fast track at 26-1. So we had a horse, in General John B., with multiple big wins.
General John B. finished second, paying $40.40 to place. Giacomo finished fourth, only two lengths back.
Florida Derby
In this field, two horses, B.B. Best and Park Avenue Ball, showed big wins going back to their debut race. B.B. Best?s big win was nine races back and Park Avenue Ball?s was seven races back. High Fly, on the other hand, had two big wins, one as a debut horse (five races back) and the next one three races back. Both of those wins were by 9 lengths. He?d later defeated both B.B. Best and Park Avenue Ball in the Fountain of Youth. Neither BB nor Park Ave had excuses in that race. So the 6/5 High Fly could be considered the lone qualifier. No big score here, but at least this told us that he was a legit fave.
The Wood Memorial
Five horses here showed big wins:
Bellamy Road (one race back, by 15, and four races back, by 7)
Survivalist (four races back, by 8)
Pavo (seven races back, by 5; however this was an off-the-turf race, meaning that most of the field was probably grass oriented)
Galloping Grocer (three big wins, career races one, two and three, all as a 2-year-old)
Naughty New Yorker (two big wins, by 8 and by 10, four and five races back, both as a 2-yo)
In their most recent race, Survivalist had defeated Pavo, Galloping Grocer and Naughty New Yorker in their most recent line, the Gotham.
Bellamy Road paid 7.10 and Survivalist paid 6.10 to place.
With so many big win horses, this field could be judged in a good light, and a non-big win horse, Scrappy T, came back to win a stakes race. The presence of multiple big win horses in a field gives us a message about the quality of the field.
The Blue Grass
Mr Sword showed a 9-length victory three races back in a 6-furlong sprint.
Consolidator?s big win was demoted, having been achieved on a wet fast and sealed track at Santa Anita.
High Limit had two big wins (by nearly 8 and nearly 12) as a 2-year old at Delaware.
Sun King had a big win by nearly 6 at Gulfstream two races back.
Bandini earned his big win two races back by 9 lengths, also at Gulfstream.
There were too many big win horses in here to give us a clear picture, unless we used other handicapping factors, but the big-win factor did produce the exacta: Bandini over High Limit.
The Arkansas Derby
Three horses in here showed big wins, all as 2-year olds. Of them, Afleet Alex was the only multiple big-win horse, with three of them. Greater Good, second favorite, showed no big wins. Alex won it as the favorite.
Conclusion
The big win played a big role in all the above prep races. Most of the time, the big win was not in the most recent running line, and on various occasions, multiple big wins for a single horse enhanced the factor.
These races and numerous others I?ve been researching serve to illustrate that my previous big win research, in being confined to the most recent running line, was too restrictive.
In research, handicapping logic must be intrinsic to a factor. Otherwise, we can be deceived by a false return on investment. For example, in an isolated meet, post seven might show a flat-bet profit while posts 6 and 8 show losses. Only artificial intelligence would consider the 7-post to be a positive factor. We know better.
There?s plenty of handicapping logic behind the Big Win. Horses that have produced thoroughly dominant races are capable of trouncing a field later in their career.
PS. This article was written before Giacomo won the Derby. Please note that the Derby field was full of Big Win horses, so no way I could have extracted Giacomo from among them. But his win, no matter how he got it done, does show a capability to dominate a field. It was the one piece of evidence that suggested that Giacomo was not an inherent hanger.
Don?t Get Mad, fourth place in the Derby, was also a big win horse.
KENTUCKY DERBY REFLECTIONS
The first thing I must say is that I struck out in this year?s Kentucky Derby. I did mention in advance that it?s a treacherous situation when one cannot eliminate more than half the field (in this case, from the place). But this was not any old race, and even the most disciplined player, if he loves the sport, has to give it a shot.
In the days leading up to the Derby, I received an e-mail from a reader in which he told me he was playing Giacomo. (See C&X Caf?.) It wasn?t the thorough analysis that I could post. But the man is a good player, and I?ve forever ceased to talk anyone off a longshot, so I responded, ?Go for it!?
After I?d invited you to send me e-mails, I got the note from Jon on Closing Argument, and I posted his well-thought points, telling readers to put Closing Argument horse back into the mix.
What is most frustrating, and it may be partly my fault, is that I received a second e-mail on Giacomo. It came to me the day of the race, long after I had already advised everyone that there would be no more posting. I could have posted it, but if I did, most of you would not have seen it ... since I?d announced that posting was closed, and most of you would have taken me literally and thus not seen the post. I had to stick by the rules, since this website is for all C&X readers.
In looking back at my invitation to make our website interactive, I recognize that I stated that you should only send a post if you had something objective to say. For good reason, since this can?t be flailing on the website. We don?t want an exhausting chat group. You have to create some boundaries.
From the language of Mitch?s message, I sense that he felt intimidated by my demand for objectivity. On the one hand, I asked for comments, but on the other I discouraged them, not wanting the C&X Cafe to resemble a pub on Saturday night.
In Mitch?s note, there is indeed an objective thread, that he develops from the initial creative impulse, integrated beautifully with critical thinking, and then structured into a cohesive argument. (The reason we must deal with this subject here and now is because this is precisely why I?ve been saying for such a long time that we needed to make this website interactive!)
Here?s what Mitch sent me:
Mark,
I feel like I need to apoligize for this emailing. It's wordy and should be more to the point as an email. I of course am not trying to change your viewpoints and am a little embarrased to send this along. I usually write my Derby and Belmont Stakes thoughts for myself and then sometimes send the thoughts to a few friends.
I am betting a slow horse that I do not like. I feel compelled this year. Has this ever happened to you?
Kentucky Derby 2005
I am willing to bet slow horses. Sometimes brutally slow horses. Slowest in the race kind of horses. This should be known before I state my wagering strategy for this year?s Derby. For this race my primary win wager is not on the slowest horse of the twenty in the race. There are five other horses that are slower.
Giacomo has only one lifetime win, and that was earned last October. Perhaps that should be held against him. Giacomo finished fourth in what is considered the poorest of this year?s Derby prep races. Perhaps that should be held against him. Giacomo has a sprinter?s pedigree and now must compete against horses with stouter breeding at the most demanding of distances. Perhaps that should be held against him as well. So why do I like this horse? I don?t. I do not like him at all. I never liked him. In his last three races I could not figure out why he had so much support at the betting windows, but he?s my betting choice for the 131st Derby. I am compelled to do it. You see there are three things nagging at me, and like a zombie I will head to the windows and lay down money on the horse that many feel has only two positive attributes: the only gray in the race and he is named after Sting?s son. Maybe I would seem less crazy if the gray thing mattered more to my gray matter. What I see that does interest me is a pattern that I like, the notion that the Santa Anita Derby is undervalued with most (okay all) of the experts, and the results from a prep race profile I put together of Derby winners from the last 13 years.
A couple of years ago I ran a spreadsheet of the raw running times of Derby winner?s prep races?since 1992 with an interest in looking primarily at percent early ratios and final fractions. Using the raw numbers I found that the winners fit into narrow parameters within five different computations. Funny Cide, Sir Cherokee(scratched) and Empire Maker were the only apparent contenders that year and the exacta paid $95. If I recall last year Smarty Jones was one of several that met some of the criteria, but no standouts like the previous year. So that?s it. Giacomo?s last race fits into the range of all five ratings: % early, final fraction, turn time, ability rating and final 5 furlong time.
Who did the contestants in the Santa Anita Derby beat up on? Each other. Who did the Florida horses beat up on? Each other. I suspect all of the speed rating services are correct in saying that the California horses are abysmal. I am just not convinced of that conclusion.
Giacomo has the look of a healthy horse. His improvement has been gradual without any large jumps in performance excepting his second race lifetime after a bad first race and a three month layoff. He has handled jumps in class well even though he is without a win in a race versus other winners. His running style, steady grin
CONTENTS
Editorial
On Being Selective, Lessons from French Racing
Creative but Critical Thinking
The Big Win Method: Revisited
Kentucky Derby Reflections
Optical Illusions
C&X Caf?
EDITORIAL
Thank you for your patience in awaiting this issue. Each year I spend countless hours preparing for a single race that lasts a few ticks more than two minutes, and I usually crash right after the race, and sometimes before. Win or lose, it?s a draining thing, and philosophically it seems out of proportion, given that one should be able to handicap a 20-horse field in one hour instead of twenty. No doubt next year I will do it all over again.
Sometimes the preparation lasts for years, and is not for any particular Kentucky Derby but for the special one that eventually comes along, as was the case this year for C&X reader Dr. Billy.
Knowing the Derby would be a few days after the publication deadline, I had blocked out this issue of C&X with spaces within each article for illustrations from Derby day. It would have been senseless to publish a more abstract version of the same articles you see here, just to get it done a week earlier.
Within this issue you will become aware of why I am trying to transform C&X into a more interactive publication, in order to benefit from the unsung heroes among the C&X readership, and to truly do what we say in our respect for ?the informed minority?.
Years ago, in a public forum, I was asked about the chances of a particular horse to win a race. Some of you may remember the horse. His name was Truxton?s Double. I told the group that if Truxton?s Double won this race, I?d invite them all to lunch.
Needless to say, the horse won.
As an accomplished student of this game, I have learned to be humble. When I?m in public meetings or forums on non-racing subjects, I often hear people get up and spout off unmeasurable and unverifiable opinions as if such views were engraved in holy tablets. If the unfounded convictions get too outlandish, I?ll stand up and warn the audience that such absolute resolve is not warranted, and that people who express themselves in certainties should try reading a racing form and wagering on their convictions.
The past performances provide us with a great advantage in the search for the meaning of life, for studious horseplayers know that nothing is as simple as it seems.
ON BEING SELECTIVE: LESSONS FROM FRENCH RACING
Like any financial market, horse betting is very much a game of knowledge. We need to know something that the betting public does not know or underestimates. I have learned things from French racing that tell me what I need to know, should know or don?t know about American races. This has helped me know, in American racing, when to bet and when to pass. These are things I probably would not have realized had I not experienced the French racing game, through the publication called Paris-Turf.
The lesson came to me thanks to the format. In order to keep down the price of it?s publication, Paris-Turf publishes limited past performaces for every race but the featured national wager: the Quint? (formerly the Tierc?). In this race, which is broadcast on national TV from 20-to-30 minutes each day, one has the choice to make normal bets or to do lottery-style wagers in which you need to pick the top three in order (tierc?), the top four (quart?), or the top five (quint?). There are consolation payoffs if you get the right horses in the wrong order. The quint? payoffs rival or exceed pick 6 payoffs. That?s because the smallest field is 14 horses and the field could be as large as 20.
In order to protect the reputation and status of this bet, the Paris-Turf, as well as various spin-off publications, print an interview with the trainer (or sometimes the jockey) of each horse. This spokesperson must state, with the utmost honesty, where the horse is in his performance cycle, what the expectations are for the race, why the horse is entered in this particular spot, the horse?s recent health conditions, and other particulars that might affect the horse?s performance. Most of the trainers are remarkably frank, saying things like: ?My horse needs two or three more races to reach his peak?; ?I don?t like the spot, but my horse couldn?t get into another race and needs the prep?; ?Sure my horse is coming back after a layoff, but rest assured that he?s worked in company and is well prepared to fire fresh?.
In this feature race, but not for the other races, the Paris-Turf includes back races in the past performances if they happen to be the same track, distance and surface. So, if you normally have only seven or eight pp races for each horse, the seventh or eighth lines down might be the horse?s 11th or 13th race back, because those lines illustrate the horse?s performance in a situation that mimics today?s race. I?ve collected several times on longshots because I discovered, thanks to this information digging that was done for me, that the horse today was shipping to a rider who won with him at 20-1, or to the track/distance of his last victory. It?s excellent formate for uncovering pattern matches that might not appear in American pps.
With the wealth of information in the quint? races, and the paucity of data for the others, I had a built-in rationale for which races to play. To the quint? race I add stakes races to my betting portfolio. The front and back pages of Paris-Turf often have in-depth trainer interviews which deal with the same type of information that you see for the quint? races. So without having to be discerning, I automatically knew which races to play: the quint? races and Grade I events. I?ll play another type of race if some information from the above formats has been retained and can be recycled.
Transferring this knowledge
I have learned to treat American races in the same way I treat French races. If the information in the DRF past performances is not enough to deduce the trainer intention, or if the pattern match I need to know about is not available in the ten listed pps but might be deeper down, I simply pass the race. Trainer stats at the bottom of the pps sometimes allow me to glean what I need to know. Horse-for-course info at the upper right hand may or may not tell me what I want to know. What would happens if a horse is 2-for-3 at today?s track and is going for 40,000 today. If I don?t see those races in the running lines, then I have no idea of those two wins were at 50,000 or at 16,000. That makes a big difference. When the Paris-Turf digs back to a comparable race, I discover whether it was a cheap race over the course or one that is equivalent to today?s class, and I also discover the condition of the course.
I recall an American turf bet I made because I had discovered a dirt-to-turf play at a high level claiming event. The horse had raced twice on the grass and was 0-for-2. Thinking the way I read the French pps, I was curious to see those two losses, and I was able to trace the information. It turned out that both losing efforts came from outside posts in stakes races, and the horse had been competitive. In fact, reading the way he ran those two races, I could conclude that he was a horse-for-surface, the opposite of what his 0-for-2 grass record implied.
For trainer intentions, I comb the inside pages of the racing form. In some cases I?m able to put together a collage of the trainer?s opinions about his particular horses. The narrative from the inner pages of the DRF is just as important as the pps, especially since many players don?t read such articles.
In the end, my experience with the French quint? pps has helped me to filter out those American races that I could have only been played with insufficient knowldge.
So you may ask, have I ever hit a quint?. The answer is that I?ve never played one. I use the quint? pps, but I play the non-lottery bets. I use those pps to play straight win, quinellas and the multi, a bet in which you need to pick the top four, in any order.
CREATIVE BUT CRITICAL THINKING
I ask your patience, as I make a desperate attempt to shake things up and trigger a positive change in our handicapping and betting habits. I have been advised that its virtually impossible to teach people to be critical and creative thinkers at the same time. I stubbornly resist such a cynical view of humankind, knowing all the while that my own critical creativity has its flaws.
Creativity is not enough. A pure artist can find arguments in favor of 99-1 horses that have no chance.
?He?s had trouble in his last nine races!?
?After the expected double bounce, he?s ready for a new career top!?
?She has matriarchal breeding, so she?ll really improve now that she?s running against the boys.?
?Her pattern has been ?fast workout-slow race?, and now suddenly she has a slow workout, so it points to a fast race.?
Creativity needs to be accompanied by critical thinking.
The creative handicapper is willing to consider any horse and doesn?t prematurely eliminate horses for one-dimensional reasons (the way I eliminated Closing Argument). Once liberated from an overly rigid process of eliminating horses, he then uses critical thinking to find out whether there is a connection between the creative hypothesis and objective reality.
The above four superficial reasons for liking a horse can be contrasted with four more nuanced opinions:
?He?s had trouble in his last nine races because he?s a need-to-lead horse that?s uncomfortable in a crowd, and for the first time since his last win, he actually charts to grab the lead.?
?The double bounce was expected since the horse had been entered at the wrong distance/class level/surface when the races he was targeted for did not fill.?
?She?ll improve now that she?s running against the boys because this year?s crop of fillies and mares has been racing faster than the boys at the same level.?
?The horse has been working sharply but has been losing the will to compete because the class of horses he?s confronted has been too steep. Today they?re dropping him as a confidence booster. Since he already showed early speed against better in his race 9 days ago, he only needed a gallop for this one.?
The best example of such creative-but-critical thinking comes from Jon?s ideas on Closing Argument, which you saw on the C&X website, and from Mitch on Giacomo (see Derby notes below). Mitch?s reasoning goes hand in hand with my above examples.
The first group of four opinions was based on unbridled creativity, which is not all that bad in the first stage of handicapping, when many uncreative handicappers prematurely eliminate horses. But for the next stage, critical thinking takes over, and what everpatterns have been identified must be connected to objective information.
This is the process, but as you all know, it?s more complicated than that.
That?s why handicapping is fun.
The question I will ask is whether or not you can draw out natural creativity and critical thinking that is chained within the human mind. We?re talking about exercising neurons. It?s much like physical exercise. It requires energy and discipline.
A few days ago, one of the greatest people I?ve ever known informed me that he had signed up for a couple of tout services. This is a young man, though he is in his eighties. I have heard him analyze races and I know that he?s sharp enough to win on his own. He?s read the best authors and learned a lot over the years. When he has won, I have rejoiced. So for me, it was a setback to hear the tout story.
Murphy?s Law of Touts
Murphy?s Law is based on scientific proof. For example, it?s no coincidence that a fallen piece of toast almost always lands on the buttered side. I?ve done this experiment before audiences, using a various sizes a flat material, placing them face up on a table, and then pushing them over the edge. More than 90 percent of the time, they land face down ... because there?s only enough space between table and floor for one turnaround.
In horse racing, the Law of Touts is simple. Sign up for a month?s service and the one day you don?t call will be the one in which the tout gives out a $66 winner. I have enough research to prove this Law is valid. There are good touts and bad touts. Either way, you cannot win with them.
Murphy?s Second Law of touts explains that the time when you play the tout?s horse, your horse will win the race. But the time you play your horse, the tout?s horse will win.
Some touts are not bad guys. They want very much for you to win, because then you?ll sign up again. I worked for one tout who was more desperate than the players themselves.
?Cramer, I need a winner today or they?re not gonna call me tomorrow.?
?But B,? I said. ?I just gave you a $20 winner. I could have five or six straight losers and your clients would still be ahead.?
?That?s what you think!? he responded. ?What about the ones who didn?t call me the day you had the winner? What about the ones who wheeled him in the exacta and the favorite finished second? What about the ones who bet less on him because your pick lost the day before??
Dependency and liberation
Using other people to determine your decisions is debilitating. That?s not to say it cannot be a valid way of doing things. For example, if you are a brilliant handicapper and a willing to invest $48 on a pick 6 ticket, you?d do better to be a silent partner with one percent of a $4,800 ticket designed by another handicapper of good repute.
But that?s for situations of leverage, like mutual funds. And even mutual fund managers, the touts of the stock market, most often perform worse than the S & P index. Still, you get leverage with mutual funds, and it?s worth it.
But for straight betting on horses or anything else pari-mutuel, touts are a viscious circle, creating spiraling dependency in the horseplayer mentality. As dependency creeps into the mind, it takes over the space that should be occupied by liberating creativity. The more you want others to help you analyze and make decisions, the less you can think for yourself. The more you depend on others, the less you will be able to identify when another handicapper is providing you with a valuable piece of information of analysis. Knowing how to listen to and identify meaningful opinions that can be categorized as ?minority wisdom? and can become an important part of our decision making.
Can creative-plus-critical thinking be learned?
Handicapping and investment decision making is successful only to the extent that it can combine objective-analytical thinking with intuitive reasoning. There?s a metaphor that has come into style: thinking outside the box. To do this we have to understand that the box is made up of a set up limitations that our culture and pedagogical heritage has sewn into our neurons. Education is all about conditioning people to fit in. That?s how Horace Mann convinced the elite to finance public education ... by presenting it as a type of social control. Of course, private education is no less controlling.
By the time we get out of elementary school, we?ve accumulated a set of rules that control our thinking. This is not the fault of teachers, but the structure they work in and the constraints they face. How can teachers compete for the attention of children against high power professional sports, commercial TV, and an all-absorbing celebrity industry. How can young people learn about critical thinking, which comes from philosophers, when in our society, the only public philosphers are celebrities. Last time I was in a high school, philosphy was not a required course.
The discipline of philosophy would be a great help for reading the past performances. I was fortunate, in a haphazard way, to encounter philosophers in my youth who taught me critical thinking. There was, for example, Jean Sheppard, on the radio. (Excuse me if the spelling is wrong. Never actually saw his name in writing.) TV has not lent itself to philosophy. While TV was promoting icons, as visual media must, the radio offered a few spots on the dial where I could be exposed to iconoclasts like ?Bob and Ray?.
In elementary school I was taught to conform. Luckily I did not have credible teachers. (One of my teachers was nicknamed like ?the Atom Bomb?, but no matter how hard she crushed us, we never succumbed to her authoritarianism.) Luckily there were people like Jean Sheppard on the radio who gave us alternative perspectives to consider.
First, the good news
My own re-education continued with certain articles in racing publications such as American Turf Monthly and books by Tom Ainslie. It leaped forward with James Quinn?s The Handicapper?s Condition Book and Betting Thoroughbreds by Steve Davidowitz. The work of Andrew Beyer played resides in his critical thinking and his writing style. When I read Beyer, I was reading accomplished and spirited literature.
These and other writers taught me how to give critical structure to creative ideas. These guys were not telling me to be dependent on them. They were telling me that I should be thinking for myself, and they were giving me tools to do so.
But that?s not enough. When we make a pari-mutuel wager, we are betting against other people who have also learned to think critically and creatively. This is why horse betting is such a tough game.
I sometimes read fine publications such as Scientic American and Popular Science and I am struck by how well horse race handicapping complexity stands up well in the context of modern science. We are in a very enriched environment, and for this reason, it?s so hard to outsmart the people around us.
As with most financial markets, it?s less the performance of horses ... and more the inefficiencies of our handicapping rivals that we need to exploit. Human psychology is at the center of this game, because it helps determine the odds.
Once you understand this, you can learn that creative-plus-critical thinking will not serve us in every race. You can see this by noting that handicappers of undeniable talent such as Dave Litfin, Brad Free and Nick Kling (I could use other examples) can come up with different picks for the same race! How is this possible? These guys really know what they?re doing. If we could only be on a par with these guys, then we?d still be wrong more than we are right.
I have spoken to Free and Litfin on this subject, and both have communicated the same lesson. Over the years they have learned to play fewer and fewer races. This is a type of wisdom they have acquired, when they have learned, as we need to learn, that there are built-in limitations in this game and in order for us to overcome such limitations, we need to structure our handicapping and betting to such an extent that we enter less into hopeless box canyons of the mind.
So a third dimension is added to the process: creativity-critical thinking-structure. Recently I read an article about engineering design. It was called ?Voodoo Engineering?. It was a critique against a professor who wanted to transform engineering into a science of axioms, laws and equations, as if you could desynthesize the process that led to the creation of the Concorde airplane into piles of scrap. The author makes the point that creative trial-and-error went into the development of a viable design. In the conception stage, was pure fancy was considered. It was like Brancusi?s ?Bird in Flight?, the most expensive auctioned sculpture in history.
But then, the engineers knew that they had to make it work, and structured critical thinking was imposed on their fancies. Discipline was essential. The plane had to fly.
For our handicapping to soar, we need to put things together in this way. We need to begin with a liberated mind. A tout?s picks are constraining. I suppose that a tout whose purpose is to liberate the mind is no longer a tout.
We now come back to the original question. Can we learn to be creative-critical-disciplined. Of course we can. If each time you opened up the pps you reminded yourself of these three parts of the process, you would automatically be in a better position to handicap the race effectively.
But you need to ask yourself why you are doing this. If it is purely for the action, then the process will break down.
THE BIG WIN METHOD: REVISITED
I never did include the Big Win method in the C&X Crib Sheet (in a later issue we?ll do a quick summary of the Crib Sheet for newer readers). The problem was that I kept receiving contradictory samples. There were some samples that corroborated the original profitable findings and other samples that were warning signs with negative returns on investment.
But now, I think I?ve found a constraint in the original research design, and eliminating this constraint should add value to the concept.
To summarize the original rules, we?re looking for dominating horses, and for research purposes we set the bar at 5-lengths: horse must have won its last race by five lengths or more. Two exclusions follow. If the big win was on a wet track (wet-fast, sloppy, muddy, etc.) or if it came in a maiden claiming race, then it does not count. Reason: these two types of race scenarios often have fields in which only one or two horses has any possible chance. The wet race might have a field of horses that hate the going, and the maiden claimer might have a bunch of proven losers in the field. We?re more likely to see a strung-out finish in these categories of races.
The new perspective is likely to add a dimension to the method. (a) If the big win occurs in running lines other than the most recent, then this factor becomes less obvious to the public and therefore more valuable. (b) Horses showing multiple big wins are especially potent contenders.
Let?s examine this wider view of the Big Win Method. I?ll use the pps from the Kentucky Derby prep races, since you are likely to have copies of these and we do not lose page space reprinting them.
Santa Anita Derby
In that field, three horses showed big wins in their pps. Giacomo had a big win, by 10, in his maiden win, fifth race back. Don?t Get Mad also showed a big win as a first-time starter, four races back, but that 6-length victory was over a sloppy strip. Finally there was General John B. He had a big win two races back, by 6 lengths, but it was on a track labeled ?muddy?. But this was his second big win! He also showed a big win as a debut horse at Calder, six races back, winning by 8 on a fast track at 26-1. So we had a horse, in General John B., with multiple big wins.
General John B. finished second, paying $40.40 to place. Giacomo finished fourth, only two lengths back.
Florida Derby
In this field, two horses, B.B. Best and Park Avenue Ball, showed big wins going back to their debut race. B.B. Best?s big win was nine races back and Park Avenue Ball?s was seven races back. High Fly, on the other hand, had two big wins, one as a debut horse (five races back) and the next one three races back. Both of those wins were by 9 lengths. He?d later defeated both B.B. Best and Park Avenue Ball in the Fountain of Youth. Neither BB nor Park Ave had excuses in that race. So the 6/5 High Fly could be considered the lone qualifier. No big score here, but at least this told us that he was a legit fave.
The Wood Memorial
Five horses here showed big wins:
Bellamy Road (one race back, by 15, and four races back, by 7)
Survivalist (four races back, by 8)
Pavo (seven races back, by 5; however this was an off-the-turf race, meaning that most of the field was probably grass oriented)
Galloping Grocer (three big wins, career races one, two and three, all as a 2-year-old)
Naughty New Yorker (two big wins, by 8 and by 10, four and five races back, both as a 2-yo)
In their most recent race, Survivalist had defeated Pavo, Galloping Grocer and Naughty New Yorker in their most recent line, the Gotham.
Bellamy Road paid 7.10 and Survivalist paid 6.10 to place.
With so many big win horses, this field could be judged in a good light, and a non-big win horse, Scrappy T, came back to win a stakes race. The presence of multiple big win horses in a field gives us a message about the quality of the field.
The Blue Grass
Mr Sword showed a 9-length victory three races back in a 6-furlong sprint.
Consolidator?s big win was demoted, having been achieved on a wet fast and sealed track at Santa Anita.
High Limit had two big wins (by nearly 8 and nearly 12) as a 2-year old at Delaware.
Sun King had a big win by nearly 6 at Gulfstream two races back.
Bandini earned his big win two races back by 9 lengths, also at Gulfstream.
There were too many big win horses in here to give us a clear picture, unless we used other handicapping factors, but the big-win factor did produce the exacta: Bandini over High Limit.
The Arkansas Derby
Three horses in here showed big wins, all as 2-year olds. Of them, Afleet Alex was the only multiple big-win horse, with three of them. Greater Good, second favorite, showed no big wins. Alex won it as the favorite.
Conclusion
The big win played a big role in all the above prep races. Most of the time, the big win was not in the most recent running line, and on various occasions, multiple big wins for a single horse enhanced the factor.
These races and numerous others I?ve been researching serve to illustrate that my previous big win research, in being confined to the most recent running line, was too restrictive.
In research, handicapping logic must be intrinsic to a factor. Otherwise, we can be deceived by a false return on investment. For example, in an isolated meet, post seven might show a flat-bet profit while posts 6 and 8 show losses. Only artificial intelligence would consider the 7-post to be a positive factor. We know better.
There?s plenty of handicapping logic behind the Big Win. Horses that have produced thoroughly dominant races are capable of trouncing a field later in their career.
PS. This article was written before Giacomo won the Derby. Please note that the Derby field was full of Big Win horses, so no way I could have extracted Giacomo from among them. But his win, no matter how he got it done, does show a capability to dominate a field. It was the one piece of evidence that suggested that Giacomo was not an inherent hanger.
Don?t Get Mad, fourth place in the Derby, was also a big win horse.
KENTUCKY DERBY REFLECTIONS
The first thing I must say is that I struck out in this year?s Kentucky Derby. I did mention in advance that it?s a treacherous situation when one cannot eliminate more than half the field (in this case, from the place). But this was not any old race, and even the most disciplined player, if he loves the sport, has to give it a shot.
In the days leading up to the Derby, I received an e-mail from a reader in which he told me he was playing Giacomo. (See C&X Caf?.) It wasn?t the thorough analysis that I could post. But the man is a good player, and I?ve forever ceased to talk anyone off a longshot, so I responded, ?Go for it!?
After I?d invited you to send me e-mails, I got the note from Jon on Closing Argument, and I posted his well-thought points, telling readers to put Closing Argument horse back into the mix.
What is most frustrating, and it may be partly my fault, is that I received a second e-mail on Giacomo. It came to me the day of the race, long after I had already advised everyone that there would be no more posting. I could have posted it, but if I did, most of you would not have seen it ... since I?d announced that posting was closed, and most of you would have taken me literally and thus not seen the post. I had to stick by the rules, since this website is for all C&X readers.
In looking back at my invitation to make our website interactive, I recognize that I stated that you should only send a post if you had something objective to say. For good reason, since this can?t be flailing on the website. We don?t want an exhausting chat group. You have to create some boundaries.
From the language of Mitch?s message, I sense that he felt intimidated by my demand for objectivity. On the one hand, I asked for comments, but on the other I discouraged them, not wanting the C&X Cafe to resemble a pub on Saturday night.
In Mitch?s note, there is indeed an objective thread, that he develops from the initial creative impulse, integrated beautifully with critical thinking, and then structured into a cohesive argument. (The reason we must deal with this subject here and now is because this is precisely why I?ve been saying for such a long time that we needed to make this website interactive!)
Here?s what Mitch sent me:
Mark,
I feel like I need to apoligize for this emailing. It's wordy and should be more to the point as an email. I of course am not trying to change your viewpoints and am a little embarrased to send this along. I usually write my Derby and Belmont Stakes thoughts for myself and then sometimes send the thoughts to a few friends.
I am betting a slow horse that I do not like. I feel compelled this year. Has this ever happened to you?
Kentucky Derby 2005
I am willing to bet slow horses. Sometimes brutally slow horses. Slowest in the race kind of horses. This should be known before I state my wagering strategy for this year?s Derby. For this race my primary win wager is not on the slowest horse of the twenty in the race. There are five other horses that are slower.
Giacomo has only one lifetime win, and that was earned last October. Perhaps that should be held against him. Giacomo finished fourth in what is considered the poorest of this year?s Derby prep races. Perhaps that should be held against him. Giacomo has a sprinter?s pedigree and now must compete against horses with stouter breeding at the most demanding of distances. Perhaps that should be held against him as well. So why do I like this horse? I don?t. I do not like him at all. I never liked him. In his last three races I could not figure out why he had so much support at the betting windows, but he?s my betting choice for the 131st Derby. I am compelled to do it. You see there are three things nagging at me, and like a zombie I will head to the windows and lay down money on the horse that many feel has only two positive attributes: the only gray in the race and he is named after Sting?s son. Maybe I would seem less crazy if the gray thing mattered more to my gray matter. What I see that does interest me is a pattern that I like, the notion that the Santa Anita Derby is undervalued with most (okay all) of the experts, and the results from a prep race profile I put together of Derby winners from the last 13 years.
A couple of years ago I ran a spreadsheet of the raw running times of Derby winner?s prep races?since 1992 with an interest in looking primarily at percent early ratios and final fractions. Using the raw numbers I found that the winners fit into narrow parameters within five different computations. Funny Cide, Sir Cherokee(scratched) and Empire Maker were the only apparent contenders that year and the exacta paid $95. If I recall last year Smarty Jones was one of several that met some of the criteria, but no standouts like the previous year. So that?s it. Giacomo?s last race fits into the range of all five ratings: % early, final fraction, turn time, ability rating and final 5 furlong time.
Who did the contestants in the Santa Anita Derby beat up on? Each other. Who did the Florida horses beat up on? Each other. I suspect all of the speed rating services are correct in saying that the California horses are abysmal. I am just not convinced of that conclusion.
Giacomo has the look of a healthy horse. His improvement has been gradual without any large jumps in performance excepting his second race lifetime after a bad first race and a three month layoff. He has handled jumps in class well even though he is without a win in a race versus other winners. His running style, steady grin