Information and analysis for the Thoroughbred investor Quality of Mares Bred

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1 Information and analysis for the Thoroughbred investor NOVEMBER 2. leading sires by ci and cpi 3. Quality of mares bred by stud fee 10. quality of mares bred by incoming stallions 11. leading sires by cpi of young/ Maiden mares 12. North American stakes races 13. thoroughbred Investing Claiming 16. blog recap Dynaformer Dynasty The Blood-Horse MarketWatch is published by Blood-Horse Publications, 3101 Beaumont Centre Circle, P.O. Box , Lexington, KY Telephone: Quality of Mares Bred By Scot T. Gillies The leading Thoroughbred stud farms of Kentucky s bluegrass region are 700 miles distant from the financial trade zone of New York s Wall Street. No one could mistake the former s rolling hills and frolicking foals for the latter s columned facades and frenetic brokers. But each represents a monied elite. To borrow a term making headlines recently because of the Occupy movement, one small group of Kentucky-based stallions makes up the 1% of the Thoroughbred breeding market. In this industry, though, the 1% label is highly esteemed: Only stallions that have proved themselves can command top fees, and breeders reward them every year with the highest-quality book of mares. Six North American stallions stood for $100,000 or more in, marking a steady decline in the number of listed six-figure fees during the new century (see chart below). The category loses a longtime member in 2012 with the departure of A.P. Indy, whose 25 covered mares in prior to being pensioned are the thoroughbred 1% Street Cry (IRE) Leading s by Quality of Mares Bred, No. s CI Leader CI CPI Leader CPI $100,000 and up 6 Distorted Humor 6.29 Street Cry (IRE)* Distorted Humor 6.09 Medaglia d'oro Distorted Humor 6.30 Street Cry (IRE) Distorted Humor 7.36 A.P. Indy Storm Cat 8.98 Kingmambo Storm Cat 6.82 Storm Cat A.P. Indy 7.56 A.P. Indy Storm Cat 8.09 Storm Cat Storm Cat 8.90 Storm Cat A.P. Indy 7.27 Danzig Storm Cat 6.51 Storm Cat Deputy Minister 7.91 Storm Cat marketwatch.bloodhorse.com / 1 the minimum to qualify for this The Blood-Horse MarketWatch annual study. In the past dozen years A.P. Indy has led all other stallions twice by Comparable Index (CI) a measure of the production quality of a stallion s book of mares and has been in the top three six other times. Lane s End s dominant son of Seattle Slew chalks up his final ranking in, taking second place among sixfigure stallions to WinStar s Distorted Humor, who shows no sign of relinquishing the top spot he has held since the 2008 breeding season. A.P. Indy s retirement makes room atop the leader lists for fellow one-percenters to receive great racemares in addition to great producers. During the same 12-year span A.P. Indy has led all other sires by Class Performance Index (CPI) a measure of the quality of mares as racehorses two times, and has been in the overall top three every year except In his final year at stud, he earns second place behind Street Cry, who leads the $100,000-plus brigade again in after bowing to fellow Darley stallion Medaglia d Oro in Darley s internationally-renowned broodmare band includes many of the best grade and group I-winning mares from the past decade, ensuring both Street Cry and Medaglia d Oro continued support in the breeding shed and high CPI calculations. Throughout the 11 previous years MarketWatch has reported on the book quality of North American *Bernardini's CPI tops all stallions; his fee was $75,000. courtesy darley sires, the three leading six-figure stallions have always claimed the highest overall CI and CPI rankings. In two stallions upset the established pattern, at least temporarily. Gainesway s Tapit, who stood for $80,000 in, posts a 4.73 CI for mares bred, the second-highest of all stallions. Another Darley stallion becomes the first QMB rankings (Continued on page 2)

2 Quality of Mares Bred Quality of Mares Bred (Continued from page 1) leader standing for less than $100,000: Bernardini s CPI makes him the leader of all North American stallions, regardless of fee range, again showing the influence of Darley s top-notch bloodstock holdings. Bernardini stood for $75,000 in. Both of these stallions records are anomalous; Tapit will enter the elite category in 2012 with a $125,000 stud fee, as will Bernardini at $150,000. Bernardini, Street Cry, Tapit, and Medaglia d'oro also rank first through fourth in the CPI quality of young and maiden mares those without foals of racing age in. (See chart on page 11.) Ashford Stud's Lookin At Lucky leads entering sires in both CI and CPI rankings. Zensational, who stands at Hill 'n' Dale Farms, maintains his sire crop's top CPI ranking from 2010 but cedes CI honors to Vinery Florida's Maimonides, who was unranked in his first book of mares. (Find young stallion leader charts on pages ) The statistics cited in MarketWatch s Quality of Mares Bred study require a short explanation. The figures represented throughout this report indicate book quality they calculate the production and race records of all mares reported bred to each sire. These numbers often vary significantly from the data included in our annual Quality of Dams study (run in the September issue), which are a more historically important reflection of a stallion s foal crop. M Average Earnings Index (AEI) & Comparable Index (CI) for Sires Foals by Mr. Prospector Total Avg. Earnings AEI Mares bred to Mr. Prospector Total Avg.. Earnings of Total Avg.. All Other Earnings Sires' Progeny* * Progeny racing in the same country during a specific year. Foals by Other Sires The Comparable Index is calculated similarly to the Average Earnings Index (AEI) for Thoroughbred stallions, but the CI attempts to assess the producing quality of dams. Both AEI and CI are based on a comparison of a select group of foals racing results to the average earnings of all other runners competing in the same country during a given year. AEI compares the average earnings of a stallion s progeny with those of all other runners, while CI represents the average earnings for runners by other sires out of mares bred to the subject stallion in relation to all other runners. The Class Performance Index identifies mares that excelled as runners. CPI is a ratio of a mare s earnings to the average earnings of all other female runners in the same country and of the same age during the reported year. While breeders tend to favor CI rankings because they indicate proven production history, one advantage of the CPI is that it includes all mares in the stallion s book, regardless of whether they have prior runners. CI Total Avg. Earnings of All Other Sires' Progeny* Sire* Leading Sires by 20 MB $100,000 and up Distorted Humor A.P. Indy Street Cry (IRE) $50,000-$99,999 Tapit Bernardini Indian Charlie Tiznow Smart Strike Giant's Causeway $25,000-$49,999 Candy Ride (ARG) Lookin At Lucky Blame Eskendereya Quality Road Afleet Alex Henrythenavigator First Samurai Curlin Stormy Atlantic Arch Bluegrass Cat $15,000-$24,999 Unusual Heat War Front Roman Ruler Congrats Super Saver Successful Appeal Perfect Soul (IRE) Summer Bird Midshipman City Zip Bernstein Colonel John $10,000-$14,999 All American (AUS) Northern Afleet Wildcat Heir Majesticperfection Divine Park Mizzen Mast Afleet Express Chapel Royal Desert Party $5,000-$9,999 Hat Trick (JPN) Cowboy Cal Giacomo Where's the Ring Sligo Bay (IRE) Circular Quay Old Forester D'wildcat Under $5,000 Maimonides Alumni Hall Vronsky Decarchy Rebellion (GB) Thorn Song Sire* Leading Sires by CPI MB $100,000 and up Street Cry (IRE) Medaglia d'oro A.P. Indy $50,000-$99,999 Bernardini Tapit Smart Strike Giant's Causeway Pulpit Tiznow $25,000-$49,999 Candy Ride (ARG) Stormy Atlantic English Channel Lookin At Lucky Quality Road Curlin More Than Ready Blame Hard Spun Arch Eskendereya Sky Mesa $15,000-$24,999 Roman Ruler Midnight Lute War Front Ghostzapper Super Saver Zensational Summer Bird Discreet Cat City Zip Congrats Macho Uno Perfect Soul (IRE) $10,000-$14,999 Mizzen Mast Mutakddim Touch Gold War Chant Divine Park Holy Bull Northern Afleet El Corredor U S Ranger $5,000-$9,999 Jazil First Defence Pleasantly Perfect Old Forester Latent Heat Tizdejavu Papa Clem Under $5,000 North Light (IRE) Milwaukee Brew Thorn Song Not Bourbon The Pamplemousse Storm and a Half / marketwatch.bloodhorse.com

3 Quality of Mares Bred (25 or more in ) The following table lists stallions that have at least two years at stud and were bred to 25 or more mares in. A second table on page 10 lists stallions bred to their first crop of mares in The first table groups stallions alphabetically by seven stud fee ranges. shows the first year a sire s foals were born. s are published fees. MB is the number of mares bred (MB) to a stallion during the breeding season. 11 MB is the number of mares bred during the breeding season with the number of unraced mares bred in parentheses. is accompanied by Foals in parentheses. CI is the Comparable Index, which indicates the quality of mares as producers. 20 is for mares bred in. 20 represents the CI for mares that had foals in. 10 CI is the CI for all mares bred in CPI is the Class Performance Index, which indicates the racing ability of mares bred. CPI represents the racing quality of mares bred during the breeding season. CPI represents the racing quality of the dams of foals. MB $100,000 and up 10 CI Sire First % Change Largest % Incr. MB Medaglia d'oro % Largest % Decr. MB A.P. Indy % Largest % Incr. CI, Distorted Humor % Largest % Decr. CI, Dynaformer % Largest % Incr. CI, Medaglia d'oro % Largest % Decr. CI, Dynaformer % A.P. Indy 1994 $150, (6) 80 (36) Distorted Humor 2000 $100, (15) 136 (87) Dynaformer 1991 $150, (9) 78 (46) Medaglia d'oro 2006 $100, (13) 170 (128) Street Cry (IRE) 2004 $150, (11) 159 (117) Unbridled's Song 1998 $100, (16) 127 (98) $50,000-$99,999 Sire First % Change Largest % Incr. MB Indian Charlie % Largest % Decr. MB Pulpit % Largest % Incr. CI, Tapit % Largest % Decr. CI, Smart Strike % Largest % Incr. CI, Tapit % Largest % Decr. CI, Awesome Again % Awesome Again 2000 $50, (10) 96 (60) Bernardini 2008 $75, (10) 133 (98) Elusive Quality 2000 $50, (21) 129 (95) Giant's Causeway 2002 $85, (33) 217 (160) Indian Charlie 2000 $70, (23) 109 (75) Malibu Moon 2001 $60, (25) 174 (142) Pulpit 1999 $50, (12) 97 (70) Smart Strike 1998 $75, (15) 160 (129) Speightstown 2006 $50, (20) 103 (56) Tapit 2006 $80, (17) 171 (124) Tiznow 2003 $75, (21) 144 (111) MB $25,000-$49, CI Sire First % Change Largest % Incr. MB Sky Mesa % Largest % Decr. MB First Samurai % Largest % Incr. CI, Afleet Alex % Largest % Decr. CI, Tale of the Cat % Largest % Incr. CI, Candy Ride (ARG) % Largest % Decr. CI, Henrythenavigator % Afleet Alex 2007 $25, (38) 150 (107) Arch 2000 $30, (11) 107 (85) Big Brown 2010 $40, (21) 98 (74) Blame 2012 $35, (12) Bluegrass Cat 2008 $25, (24) 147 (108) Broken Vow 2003 $25, (14) 135 (104) Candy Ride (ARG) 2006 $40, (25) 187 (143) Corinthian 2009 $25, (22) 150 (113) Curlin 2010 $40, (24) 150 (121) English Channel 2009 $25, (11) 109 (85) Eskendereya 2012 $30, (20) Exchange Rate 2003 $25, (13) 117 (84) First Samurai 2008 $25, (6) 107 (78) Hard Spun 2009 $30, (23) 137 (97) Harlan's Holiday 2005 $25, (28) 162 (122) Henrythenavigator 2010 $35, (27) 169 (111) Kitten's Joy 2007 $25, (19) 174 (144) Lemon Drop Kid 2002 $35, (17) 145 (116) Lookin At Lucky 2012 $35, (27) Mineshaft 2005 $25, (18) 138 (81) More Than Ready 2002 $40, (21) 131 (93) Quality Road 2012 $35, (30) Rock Hard Ten 2007 $25, (23) 145 (87) Sky Mesa 2005 $30, (27) 127 (102) Stormy Atlantic 2000 $30, (25) 125 (88) Street Sense 2009 $40, (24) 124 (81) Tale of the Cat 2000 $30, (23) 152 (101) courtesy darley Medaglia d'oro courtesy gainesway Tapit marketwatch.bloodhorse.com / 3

4 Quality of Mares Bred (25 or more in ) MB $15,000-$24, CI Sire First % Change Largest % Incr. MB Congrats % Largest % Decr. MB Roman Ruler % Largest % Incr. CI, War Front % Largest % Decr. CI, Macho Uno % Largest % Incr. CI, Congrats % Largest % Decr. CI, Invasor (ARG) % Any Given Saturday 2009 $20, (18) 123 (76) Bernstein 2002 $20, (18) 122 (91) Birdstone 2006 $20, (12) 117 (87) City Zip 2003 $15, (15) 150 (116) Colonel John $15, (24) 135 (85) Congrats 2008 $15, (28) 129 (90) Discreet Cat 2009 $17, (21) 104 (78) Discreetly Mine 2012 $15, (28) Fusaichi Pegasus 2002 $15, (18) 127 (77) Ghostzapper 2007 $20, (11) 79 (43) Grand Slam 2000 $15, (10) 120 (75) Invasor (ARG) 2009 $20, (11) 44 (25) Langfuhr 1999 $15, (17) 96 (69) Macho Uno 2005 $15, (11) 60 (39) Midnight Lute 2010 $17, (20) 114 (76) Midshipman 2012 $15, (32) Not For Love 1997 $20, (5) 55 (40) Perfect Soul (IRE) 2006 $15, (14) 63 (33) Pioneerof the Nile $17, (15) 130 (99) Quiet American 1993 $15, (12) 61 (35) Roman Ruler 2007 $15, (12) 135 (93) Street Boss 2010 $17, (14) 120 (81) Successful Appeal 2002 $15, (15) 110 (62) Summer Bird 2012 $15, (27) Super Saver 2012 $20, (26) Tale of Ekati 2012 $15, (20) Unusual Heat 1999 $20, (3) 83 (64) War Front 2008 $15, (26) 90 (70) Warrior's Reward 2012 $15, (33) Yes It's True 2002 $15, (25) 120 (84) Zensational $22, (16) 135 (84) MB $10,000-$14, CI Afleet Express 2012 $10, (14) All American (AUS) 2012 $10, (11) Sire First % Change Largest % Incr. MB Bellamy Road % Largest % Decr. MB El Corredor % Largest % Incr. CI, Leroidesanimaux (BRZ) % Largest % Decr. CI, Henny Hughes % Largest % Incr. CI, Northern Afleet % Largest % Decr. CI, Henny Hughes % Artie Schiller 2008 $10, (16) 131 (83) Bellamy Road 2008 $10, (39) 46 (25) Chapel Royal 2006 $10, (10) 42 (26) Desert Party 2012 $10, (28) Divine Park 2010 $10, (11) 49 (32) Dunkirk $10, (17) 186 (135) E Dubai 2004 $10, (6) 62 (33) El Corredor 2003 $12, (8) 122 (80) Even the Score 2006 $10, (5) 48 (25) Flower Alley 2008 $10, (14) 99 (67) Forestry 2001 $12, (15) 75 (52) Henny Hughes 2008 $12, (13) 132 (81) Holy Bull 1996 $10, (2) 69 (44) Jump Start 2004 $10, (14) 115 (74) Kitalpha 2009 $12, (10) 124 (69) Kodiak Kowboy $10, (9) 79 (57) Leroidesanimaux (BRZ) 2007 $12, (33) 69 (37) Majestic Warrior 2010 $10, (25) 103 (62) Majesticperfection 2012 $10, (30) Mizzen Mast 2004 $12, (18) 118 (78) Munnings 2001 $12, (32) Mutakddim 1998 $10, (9) 35 (21) Northern Afleet 2000 $12, (28) 126 (88) Old Fashioned $12, (16) 124 (81) Pollard's Vision 2007 $12, (14) 165 (88) Posse 2005 $10, (14) 87 (56) Proud Citizen 2005 $10, (9) 45 (36) Rockport Harbor 2008 $12, (16) 130 (88) Bellamy Road courtesy Pauls Mill Congrats louise reinagel 4 / marketwatch.bloodhorse.com

5 MB 10 CI Scat Daddy 2009 $10, (29) 92 (56) Shakespeare 2009 $10, (14) 53 (18) Smarty Jones 2006 $10, (13) 44 (28) Smoke Glacken 1999 $10, (6) 53 (30) Stevie Wonderboy 2009 $10, (15) 59 (39) Sun King 2009 $10, (6) 86 (49) Thunder Gulch 1997 $10, (8) 69 (36) Tiz Wonderful 2010 $12, (29) 143 (99) Touch Gold 2000 $10, (5) 44 (31) U S Ranger $10, (18) 87 (48) War Chant 2002 $12, (10) 67 (41) Wildcat Heir 2007 $10, (25) 148 (94) $5,000-$9,999 Sire First % Change Largest % Incr. MB Philanthropist % Largest % Decr. MB Tribal Rule % Largest % Incr. CI, Awesome of Course % Largest % Decr. CI, Jazil % Largest % Incr. CI, Hat Trick (JPN) % Largest % Decr. CI, Lewis Michael % A. P. Warrior 2008 $6, (15) 48 (30) After Market 2009 $7, (13) 66 (44) Alphabet Soup 1999 $6, (4) 51 (29) Awesome of Course 2005 $5, (12) 24 (2) Badge of Silver 2008 $7, (8) 76 (41) Bandini 2008 $5, (6) 76 (39) Belong to Me 1995 $7, (7) 71 (33) Bertrando 1995 $8, (9) 50 (34) Bob and John 2009 $8, (7) 55 (38) Brother Derek 2010 $7, (12) 43 (27) Bullsbay 2012 $5, (1) Buzzards Bay 2010 $5, (4) 29 (19) Cactus Ridge 2005 $5, (4) 56 (34) Cape Canaveral 2002 CAN$7, (5) 35 (17) Circular Quay 2010 $6, (7) 76 (38) Closing Argument 2007 $5, (11) 35 (21) Concord Point 2012 $7, (18) Congaree 2006 $7, (7) 45 (26) Cool Coal Man 2001 $5, (22) MB 10 CI Cosmonaut $5, (8) 42 (24) Cowboy Cal $7, (5) 128 (94) Dixie Chatter $5, (5) 68 (45) D'wildcat 2005 $8, (13) 92 (55) Einstein (BRZ) $7, (24) 84 (40) Fairbanks 2010 $6, (12) 77 (48) First Defence 2010 $7, (8) 76 (48) Five Star Day 2003 $5, (3) 45 (24) Flashy Bull 2009 $6, (17) 31 (20) Flatter 2005 $7, (30) 109 (71) Freud 2003 $8, (16) 110 (80) Frost Giant 2010 $7, (3) 36 (29) Giacomo 2008 $5, (8) 90 (59) Golden Missile 2002 $7, (9) 40 (23) Good Journey 2008 $5, (4) 44 (33) Good Reward 2008 $5, (8) 55 (34) Graeme Hall 2004 $5, (10) 99 (64) Hat Trick (JPN) 2009 $6, (7) 32 (21) Hold Me Back 2012 $6, (24) Horse Greeley 2010 $5, (6) 47 (26) Imperialism 2008 $5, (16) 63 (27) Include 2004 $7, (11) 28 (20) Indygo Shiner 2004 $7, (21) 139 (94) Into Mischief 2010 $8, (12) 44 (30) Jazil 2009 $7, (9) 35 (19) Justenuffhumor 2012 $5, (9) Kafwain 2005 $5, (6) 57 (42) Kantharos 2012 $5, (17) Kipling 2002 $5, (6) 44 (32) Latent Heat 2009 $8, (35) 79 (47) Lewis Michael 2010 $5, (4) 40 (22) Limehouse 2007 $6, (3) 73 (44) Line of David 2012 $7, (12) Louis Quatorze 1999 $5, (2) 35 (23) Magna Graduate 2010 $5, (17) 74 (48) Monarchos 2003 $6, (6) 45 (33) Montbrook 1996 $7, (10) 77 (51) Neko Bay 2012 $7, (10) tom hall Philanthropist courtesy journeyman stud Awesome of Course marketwatch.bloodhorse.com / 5

6 Quality of Mares Bred (25 or more in ) MB 10 CI Nobiz Like Shobiz 2010 $5, (10) 70 (40) MB 10 CI Sweet Return (GB) 2009 $5, (8) 38 (25) Noble Causeway 2009 $5, (6) 48 (36) Noonmark $6, (9) 87 (46) Notional 2010 $7, (24) 110 (64) Old Forester 2008 CAN$8, (23) 41 (17) Olmodavor 2006 $5, (4) 38 (18) Orientate 2004 $7, (6) 73 (49) Papa Clem $6, (21) 57 (47) Petionville 1998 $6, (2) 33 (24) Philanthropist 2008 Private 96 (13) 23 (9) Pleasantly Perfect 2006 $7, (35) 54 (29) Point Given 2003 $7, (6) 32 (24) Pomeroy 2008 $5, (37) 53 (36) Pure Prize 2004 $5, (9) 111 (58) Purge 2007 $5, (5) 22 (15) Purim 2009 $7, (10) 86 (39) Put It Back 2003 $5, (9) 76 (38) Read the Footnotes 2006 $6, (11) 43 (27) Ready's Image 2010 $6, (16) 63 (34) Red Giant 2010 $6, (9) 42 (28) Run Away and Hide 2010 $5, (11) 78 (44) Scipion 2009 $5, (3) 27 (16) Sharp Humor 2008 $7, (29) 80 (50) Showing Up 2010 $5, (6) 55 (33) Silver Train 2008 $7, (11) 79 (52) Sligo Bay (IRE) 2005 CAN$6, (7) 67 (38) Songandaprayer 2003 $6, (8) 57 (43) Spring At Last 2010 $7, (14) 92 (55) Stephen Got Even 2002 $7, (25) 129 (76) Stormin Fever 2001 $6, (9) 70 (46) Street Hero 2010 $6, (6) 60 (31) Stroll 2006 $7, (9) 90 (57) Student Council 2010 $7, (10) 76 (45) Surf Cat 2010 $5, (7) 42 (34) Swiss Yodeler 2000 $5, (8) 39 (32) Temple City 2012 $5, (19) Tizdejavu 2012 $5, (19) Tribal Rule 2004 $6, (2) 101 (79) Two Step Salsa $5, (9) 93 (56) Utopia (JPN) 2009 $7, (11) 112 (78) Valid Expectations 1999 $7, (4) 57 (37) Value Plus 2007 $5, (11) 64 (37) Where's the Ring 2006 CAN$6, (9) 94 (45) With Distinction 2008 $5, (21) 137 (84) Yankee Gentleman 2005 $5, (11) 109 (59) Zanjero 2010 $7, (12) 67 (45) Less than $5,000 Sire First % Change Largest % Incr. MB Zarbyev ,600% Largest % Decr. MB Suave % Largest % Incr. CI, Maimonides 162% Largest % Decr. CI, Skye'n Thunder % Largest % Incr. CI, Vronsky % Largest % Decr. CI, Quest % Action This Day 2006 $1, (9) 13 (3) Added Edge 2008 $1, (5) 40 (22) Affirmatif 2012 $1, (6) Alumni Hall 2009 CAN$3, (6) 27 (12) Aragorn (IRE) 2008 $4, (4) 67 (39) Attila's Storm 2009 $1, (7) 36 (24) Awesome Gambler 2009 $3, (15) 39 (16) Behindatthebar $2, (13) 60 (27) Benchmark 2000 $4, (3) 40 (30) Benny the Bull $3, (9) 74 (45) Big Top Cat 2008 $2, (4) 39 (30) Bold Executive 1990 CAN$15, (3) 30 (15) Bold n' Flashy 1997 CAN$3, (4) 30 (12) A.P. Indy courteesy lane's end/tony leonard Indian Charlie courtesy airdrie stud/tony leonard 6 / marketwatch.bloodhorse.com

7 MB 10 CI MB 10 CI Bop 2005 $2, (7) 62 (27) Distorted Reality 2010 Private 48 (6) 55 (38) Bring the Heat 2004 $2, (16) 48 (26) Domestic Dispute 2006 $2, (0) 9 (6) Burbank 2002 $1, (5) 15 (11) Don'tsellmeshort 2009 Private 31 (4) 36 (29) Bushwacker $3, (6) 51 (27) Early Flyer 2005 $2, (5) 22 (14) Bustin Stones 2010 $2, (10) 31 (14) Easyfromthegitgo 2005 $2, (9) 100 (43) Bwana Charlie 2007 $2, (9) 15 (7) Ecclesiastic 2009 $3, (7) 35 (19) Canadian Frontier 2006 $3, (13) 23 (14) Elusive Warning 2012 $4, (3) Cat Dreams 2006 $2, (5) 51 (26) Cat Thief 2002 $4, (12) 31 (16) Cause to Believe 2010 CAN$2, (10) 70 (43) Charitable Man 2012 Private 79 (12) Chatain 2010 $2, (4) 42 (26) Chestertown Slew $1, (3) 52 (23) Chief Seattle 2002 $2, (6) 62 (14) Cindago 2008 $2, (4) 32 (20) City Place 2006 $3, (9) 38 (22) City Weekend 2009 $3, (5) 36 (27) Colonial Colony 2007 Private 29 (6) 32 (17) Concerto 2000 $3, (6) 40 (22) Council Member 2010 $4, (3) 35 (25) Cowtown Cat 2010 $4, (16) 51 (28) Dance Master 2002 $1, (6) 35 (21) Etbauer 2001 $1, (2) 38 (15) Eurosilver 2007 $3, (5) 6 (4) Evansville Slew 1997 $1, (4) 34 (18) Exclusive Quality 2009 $4, (15) 70 (40) Fastness (IRE) 1998 $4, (4) 26 (12) Fearless 2012 Private 32 (3) Finality 2005 CAN$3, (3) 38 (22) Firejack 2010 Private 28 (8) 26 (18) Forefathers $2, (10) 67 (41) Formal Gold 2000 CAN$2, (2) 17 (8) Fort Prado $3, (2) 66 (37) Gaff 2010 Private 51 (7) 18 (6) Giant Gizmo CAN$4, (6) 71 (45) Gold Tribute 1999 $2, (4) 29 (16) Dance With Ravens 2007 $2, (4) 40 (24) Golden Ransom 2004 $2, (7) 21 (14) Decarchy 2005 $4, (8) 49 (31) Good and Tough 2001 $3, (3) 45 (24) Denis of Cork $2, (7) 20 (11) Gottcha Gold 2010 $2, (10) 46 (24) Desert Code $2, (12) 45 (32) Grace Upon Grace 2012 $2, (2) Devil His Due 1997 $3, (6) 44 (26) Grand Minstrel $1, (5) 31 (14) Devon Lane 1999 $2, (7) 34 (15) Grand Reward 2007 $4, (6) 12 (3) Diabolical Private 66 (9) 66 (43) Grasshopper 2012 $3, (7) courtesy winstar farm Distorted Humor courtesy three chimneys farm Sky Mesa marketwatch.bloodhorse.com / 7

8 Quality of Mares Bred (25 or more in ) MB 10 CI Grazen $2, (4) 13 (12) Great Notion 2006 $2, (3) 36 (20) Greeley's Conquest 2012 Private 27 (1) Grindstone 1998 $2, (6) 79 (46) Half Ours 2009 $4, (17) 91 (59) Harbor the Gold 2006 $4, (7) 73 (42) Hear No Evil 2007 $3, (6) 64 (39) High Cotton 2009 $2, (12) 84 (49) Honest Man 2012 $2, (6) Ide 1998 $2, (6) 67 (33) Impervious 2010 Private 32 (0) In Summation $4, (13) 87 (61) Intimidator 2007 $1, (18) 71 (47) Jockey's Dream (BRZ) Private 35 (12) 13 (6) Jonesboro 2012 $1, (9) K One King 2002 $1, (7) 35 (19) Keyed Entry 2010 $3, (13) 69 (42) Killenaule 2009 Private 31 (3) 44 (25) Kiss the Kid 2012 $3, (7) Kissin Kris 1997 CAN$3, (1) 34 (12) Lantana Mob 2012 $1, (5) Leonnatus Anteas CAN$3, (5) 38 (22) Lion Hearted 2002 $3, (12) 63 (38) Lion Tamer 2008 $2, (2) 39 (23) Lost Canyon (GB) 2006 CAN$1, (2) 37 (8) Lucky Pulpit 2008 $2, (18) 36 (29) Lydgate 2007 $2, (6) 34 (19) Maimonides $3, (15) 48 (26) Malibu Moonshine 2012 $3, (5) Many Rivers 2012 $3, (3) MB 10 CI Marchfield 2012 CAN$4, (14) Marino Marini 2006 $2, (4) 38 (25) Marsh Side Private 28 (2) Mass Media 2008 $2, (24) 17 (10) Mast Track 2012 CAN$2, (5) Matty G 1999 $2, (4) 39 (27) Milwaukee Brew 2005 CAN$12, (6) 111 (69) Ministers Wild Cat 2007 $4, (4) 27 (19) Mr. Nightlinger $1, (11) 47 (26) Musket Man 2012 $2, (4) My Pal Charlie $3, (8) 73 (34) North Light (IRE) 2007 CAN$10, (6) 50 (33) Not Bourbon 2012 CAN$5, (8) Ocean Indy 2009 $1, (2) 31 (7) Offlee Wild 2007 $4, (11) 146 (87) Ole Rebel 2007 $1, (4) 21 (8) Omega Code 2006 $2, (9) 31 (11) Orthodox 2012 $1, (8) Outflanker 1999 $3, (3) 32 (19) Parading $3, (14) 97 (54) Parker's Storm Cat 2005 $2, (12) 58 (23) Peak Dancer 2005 Private 26 (2) 17 (12) Porto Foricos 2001 $1, (2) 66 (28) Portobello Road 2010 $1, (11) 39 (25) Preachinatthebar 2009 $1, (12) 19 (9) Primary Suspect 2009 $1, (4) 34 (19) Prime Timber 2003 Private 30 (7) Private Gold 2006 $1, (4) 20 (13) Private Vow 2010 $2, (9) 45 (35) Proud Tower Too 2009 Private 26 (13) 25 (12) Afleet Alex courtesy gainesway Candy Ride courtesy lane's end farm/lee p. thomas 8 / marketwatch.bloodhorse.com

9 MB 10 CI MB 10 CI Quest 2007 Private 31 (5) 9 (6) Storm Victory 2005 CAN$2, (10) 19 (10) Raise the Bluff 2009 $1, (4) 25 (19) Street Magician 2012 $3, (9) Rebellion (GB) CAN$3, (7) 26 (17) Strut the Stage 2008 CAN$2, (4) 29 (16) Roaring Fever 2006 $3, (5) 23 (14) Suave 2008 $4, (5) 95 (57) Rosberg 2010 CAN$3, (2) 21 (15) Supah Blitz 2007 $1, (2) 5 (1) Ruler's Court 2008 $2, (8) 37 (21) Tactical Cat 2001 $1, (15) 48 (30) Run Production 2004 $3, (2) 9 (10) Tale of the Hills 2008 $2, (13) Run to Victory 2008 CAN$2, (2) 4 (2) Talent Search $2, (3) 63 (40) Saint Anddan 2009 $4, (10) 37 (18) Tales Not Told 2009 $1, (11) 50 (5) Saint Stephen 2009 CAN$3, (1) 46 (18) Tenpins 2006 $3, (7) 42 (14) Salute the Sarge 2010 $2, (8) 41 (27) Terrell 2007 $2, (1) 30 (29) Sarava 2006 $1, (8) 31 (11) The Pamplemousse 2012 $3, (3) Save Big Money $2, (8) 41 (23) The Visualiser $1, (6) 34 (14) Seeking a Home 2003 Private 29 (9) 12 (3) The Way Home 2009 $2, (4) 39 (19) Seeking Beauty $1, (4) 3 (1) Thorn Song 2012 $3, (5) Seeking the Best (IRE) 2009 CAN$5, (6) 40 (19) Time Bandit 2001 $1, (2) 13 (9) Senor Swinger 2009 $4, (3) 23 (11) Toccet 2006 Private 50 (4) 63 (20) Sightseeing 2010 $3, (13) 48 (27) Too Much Bling 2008 $4, (8) 56 (27) Silic (FR) 2002 $3, (9) 8 (4) Toolighttoquit 1998 $2, (11) 58 (30) Silver City 2012 $2, (4) Trickey Trevor 2009 $1, (1) 27 (12) Sing Baby Sing 2012 $2, (5) Uncle Abbie 2003 $3, (5) 42 (20) Singing Saint CAN$2, (4) 33 (22) Vibank 2009 CAN$1, (7) 26 (12) Skye'n Thunder 2007 $ (14) 33 (0) Vronsky 2006 $3, (13) 51 (30) Smooth Air 2012 $2, (13) War Cry 2010 CAN$2, (7) 39 (12) Smooth Jazz 2005 $2, (11) 12 (7) Waupaca $1, (5) 9 (9) So Long Birdie 2007 $2, (6) 29 (17) Weigelia 2010 $3, (9) 29 (25) Southern Image 2007 $4, (5) 31 (28) West Acre 1999 $2, (12) 7 (3) Southwestern Heat 2009 $2, (1) Wilko 2009 CAN$5, (1) 66 (48) Spanish Steps 2006 $2, (3) 17 (11) Windsor Castle 2005 $2, (12) 78 (39) Special Rate 2007 $3, (6) 33 (16) Xchanger 2010 $1, (3) 14 (6) Square Eddie Private 40 (4) 34 (33) Yesbyjimminy $2, (9) 36 (27) Stonesider 2009 $3, (10) 83 (51) Zarbyev 1990 $3, (7) 2 (2) Storm and a Half 2002 $1, (7) 24 (11) Zavata 2005 $2, (3) 8 (6) courtesy claiborne farm War Front courtesy taylor made/winstar farm venture Northern Afleet marketwatch.bloodhorse.com / 9

10 Quality of Mares Bred (first foals in 2012) Farm 11 MB Unraced Mares CI CPI Affirmatif $1,000 Diamond G Ranch Afleet Express $10,000 Gainesway All American (AUS) $10,000 Darby Dan Farm Blame $35,000 Claiborne Farm Bullsbay $5,000 Northview Station Charitable Man Private Taylor Mountain Farm Concord Point $7,500 Hill 'n' Dale Farms Desert Party $10,000 Darley Discreetly Mine $15,000 Lane's End Elusive Warning $4,000 Madera Thoroughbreds Eskendereya $30,000 Taylor Made s, Inc Fearless Private Duchess Views Farm Grace Upon Grace $2,000 Lovacres Ranch Grasshopper $3,500 Lane's End Texas Greeley's Conquest Private Breeders Station Hold Me Back $6,000 WinStar Farm LLC Honest Man $2,000 Red River Farms Jonesboro $1,500 Lake Hamilton Equine Associates Justenuffhumor $5,000 Vinery New York Kantharos $5,000 Vinery Florida Kiss the Kid $3,500 Journeyman Stud Lantana Mob $1,500 Lake Shore Farm Line of David $7,500 Spendthrift Farm Lookin At Lucky $35,000 Ashford Stud Majesticperfection $10,000 Airdrie Stud Malibu Moonshine $3,000 Carlland Stables, Inc Many Rivers $3,000 Victory Rose Thoroughbreds Marchfield CAN$4,000 Park Stud Mast Track CAN$2,500 Adena Springs Canada Midshipman $15,000 Darley Musket Man $2,500 Vinery Florida Neko Bay $7,500 Wintergreen Station Not Bourbon CAN$5,000 Norse Ridge Farms Orthodox $1,000 Peach Lane Farms Quality Road $35,000 Lane's End Silver City $2,000 Valor Farm Sing Baby Sing $2,500 Lane's End Texas Smooth Air $2,500 Fanlew Farms Street Magician $3,000 Northview Station Summer Bird $15,000 WinStar Farm LLC Super Saver $20,000 WinStar Farm LLC Tale of Ekati $15,000 Darby Dan Farm Temple City $5,000 Spendthrift Farm The Pamplemousse $3,500 Rancho San Miguel Thorn Song $3,500 Harris Farms Tizdejavu $5,000 Crestwood Farm Warrior's Reward $15,000 Spendthrift Farm / marketwatch.bloodhorse.com Eskendereya Lookin At Lucky Quality Road Super Saver anne m. eberhardt courtesy lane's end/lee p. thomas courtesy ashford NYRA/david alcosser

11 Leading Young Sires by 20 and CPI The following table lists stallion leaders by Class Performance Index (CPI) of young and maiden mares those without foals of racing age in. CPI First Foals CPI Sire MB Lookin At Lucky Quality Road Blame Eskendereya Thorn Song Super Saver CI First Foals 20 Sire MB Lookin At Lucky Blame Eskendereya Quality Road All American (AUS) Super Saver CPI - First Foals CPI Sire MB Zensational U S Ranger Papa Clem Bushwacker Colonel John Rebellion (GB) CI - First Foals 20 Sire MB Maimonides Cowboy Cal Colonel John Zensational Rebellion (GB) Fort Prado Kodiak Kowboy CPI First Foals CPI Sire MB Curlin Midnight Lute Henrythenavigator First Defence Divine Park Street Boss CI First Foals 20 Sire MB Henrythenavigator Curlin Circular Quay Divine Park Big Brown Midnight Lute Leading Sires by Quality of Young/Maiden Mares Bred For each stallion are listed the number of young/maiden mares he covered in (with percentage of all mares bred); those young/maiden mares' average age and CPI; the CPI of all mares the stallion covered in ; and the percentage difference between young/maiden and all mares bred. No. Young/ Maiden MB (% All MB ) Average Age of Young/Maiden Mares Bred marketwatch.bloodhorse.com / 11 Average Earnings of Young/Maiden Mares Bred CPI of Young/ Maiden MB CPI of All Mares Bred % Difference $100,000 and up Street Cry (IRE) 51 (39%) 5.49 $30, % Medaglia d'oro 60 (38%) 5.83 $29, % Distorted Humor 54 (45%) 5.46 $24, % $50,000-$99,999 Bernardini 48 (30%) 5.94 $51, % Tapit 66 (42%) 5.70 $32, % Smart Strike 70 (47%) 5.94 $23, % Malibu Moon 61 (35%) 5.93 $15, % Giant's Causeway 77 (39%) 5.53 $17, % Tiznow 47 (35%) 5.43 $16, % $25,000-$49,999 Curlin 53 (41%) 6.00 $15, % Lookin At Lucky 48 (31%) 5.46 $11, % Candy Ride (ARG) 73 (40%) 5.70 $14, % Stormy Atlantic 36 (29%) 5.97 $12, % Street Sense 33 (28%) 5.52 $12, % Sky Mesa 53 (36%) 5.58 $12, % Eskendereya 46 (34%) 5.59 $9, % Arch 50 (45%) 5.80 $9, % Afleet Alex 63 (41%) 5.38 $10, % $15,000-$24,999 Midnight Lute 27 (28%) 5.19 $8, % Roman Ruler 9 (25%) 4.56 $12, % Congrats 79 (39%) 5.53 $8, % Street Boss 30 (34%) 5.50 $7, % Ghostzapper 59 (50%) 5.97 $7, % Unusual Heat 12 (20%) 5.75 $7, % Super Saver 51 (35%) 5.37 $8, % City Zip 60 (40%) 5.88 $7, % $10,000-$14,999 Smoke Glacken 15 (33%) 5.60 $7, % Mizzen Mast 28 (36%) 5.36 $6, % Proud Citizen 17 (35%) 5.71 $6, % Mutakddim 11 (44%) 5.18 $7, % Divine Park 28 (47%) 5.00 $7, % Northern Afleet 48 (36%) 5.29 $7, % Flower Alley 19 (24%) 5.84 $5, % Artie Schiller 25 (27%) 5.92 $5, % Desert Party 28 (23%) 6.14 $5, % Touch Gold 11 (37%) 6.45 $4, % $5,000-$9,999 First Defence 10 (24%) 5.60 $17, % Bertrando 19 (46%) 5.42 $7, % Tribal Rule 9 (33%) 5.33 $6, % Kafwain 12 (26%) 6.00 $10, % Where's the Ring 30 (42%) 6.03 $6, % Old Forester 48 (43%) 5.79 $8, % Surf Cat 13 (48%) 5.77 $7, % Purge 4 (16%) 5.50 $7, % Horse Greeley 8 (24%) 5.00 $6, % Fairbanks 30 (38%) 6.20 $4, % Less than $5,000 Weigelia 9 (24%) 7.22 $9, % Milwaukee Brew 21 (47%) 6.00 $10, % Diabolical 22 (33%) 5.14 $9, % Grazen 16 (53%) 6.25 $7, % Bold n' Flashy 7 (28%) 5.14 $10, % Gold Tribute 6 (23%) 5.83 $6, % Ministers Wild Cat 24 (59%) 5.75 $7, % Singing Saint 9 (31%) 7.22 $6, % Devon Lane 9 (26%) 5.56 $4, % Private Vow 8 (24%) 7.13 $7, %

12 North American Stakes Review Leading Sires by Stakes Distance, January 2009-November 6, Leading Broodmare Sires by Stakes Distance, January 2009-November 6, SWins GSWins Sire Up to 4.5 furlongs 5 0 Windsor Castle 4 0 Greatness 3 0 Blumin Affair 3 0 Tiger Ridge 5 to 5.5 furlongs 10 2 War Chant 9 0 Speightstown 7 0 Bernstein 7 0 City Zip 7 0 Elusive Quality 7 0 Stormy Atlantic 6 furlongs SWins GSWins Sire 8 furlongs to 1 mile 70 yards 14 5 Malibu Moon 14 6 Smart Strike 13 2 Distorted Humor 12 2 Stormy Atlantic 12 5 Tiznow 11 3 Elusive Quality 11 2 Mizzen Mast 10 3 Mineshaft 10 2 Quiet American 9 2 Awesome Again 9 6 Indian Charlie 9 2 Street Cry (IRE) 8.5 furlongs Tapit Smart Strike SWins GSWins Broodmare Sire Up to 4.5 furlongs 4 0 Private Terms 4 0 Roy 4 0 Two Punch 3 0 Pentelicus 5 to 5.5 furlongs 10 2 Trempolino 7 0 Dixieland Band 6 4 Alwuhush 6 0 Mt. Livermore 6 0 Rahy 6 0 Silver Deputy 6 0 Tabasco Cat 6 1 Thirty Eight Paces SWins GSWins Broodmare Sire 8 furlongs to 1 mile 70 yards 15 6 Rahy 14 1 Cozzene 14 2 Kris S Storm Cat 10 4 Deputy Minister 10 4 Dixieland Band 10 6 Woodman 9 2 Broad Brush 8 3 Belong to Me 8 1 Carson City 8 1 Gilded Time 8 3 Mr. Prospector 8 0 Pine Bluff 8 2 Quiet American 8 3 Seeking the Gold 13 2 Flatter 17 7 Giant's Causeway 6 furlongs 8.5 furlongs 13 2 Mutakddim 12 3 City Zip 12 3 Freud 12 1 Speightstown 11 0 Blumin Affair 11 1 Not For Love 10 3 Harlan's Holiday 10 0 Valid Expectations 10 2 Yonaguska 6.5 furlongs 6 0 Katahaula County 5 0 Harbor the Gold 5 1 Speightstown 14 3 Quiet American 13 1 Cherokee Run 12 4 Distorted Humor 12 5 Medaglia d'oro 12 9 Street Cry (IRE) 12 3 Victory Gallop 9 to 9.5 furlongs Giant's Causeway Medaglia d'oro 11 9 Empire Maker Smart Strike 11 8 Tiznow 9 5 Arch 9 5 Northern Afleet 9 9 Street Cry (IRE) 10 furlongs 16 1 Dixieland Band 15 3 In Excess (IRE) 14 1 Pentelicus 12 3 Capote 11 2 Rahy 11 0 Seeking the Gold 6.5 furlongs 5 0 Colonial Affair 5 0 Deputy Minister 5 0 Regal Classic 4 0 Allen's Prospect 4 1 Dixieland Band 4 0 Forest Wildcat 4 0 Gilded Time 17 3 Deputy Minister 17 7 Kris S A.P. Indy 16 6 Broad Brush 13 6 Belong to Me 12 3 Smart Strike 12 2 Theatrical (IRE) 11 6 Rahy 11 2 Rubiano 11 4 Seeking the Gold 11 5 Unbridled 9 to 9.5 furlongs Storm Cat 12 7 Broad Brush 12 9 Seeking the Gold Kris S. 4 0 Candy Ride (ARG) 6 2 A.P. Indy 4 1 Hennessy 10 6 A.P. Indy 4 1 Elusive Quality 4 0 Finality 4 0 Golden Missile 4 0 In Excess (IRE) 4 1 Indian Charlie 4 0 Storm Victory 4 1 Successful Appeal 7 to 7.5 furlongs Candy Ride (ARG) 9 3 Posse 8 1 Freud 8 2 Stormy Atlantic 8 2 Trippi 8 0 Windsor Castle 5 5 Malibu Moon 5 5 Unusual Heat 4 3 Dynaformer 3 3 Awesome Again 3 3 Birdstone 3 3 Diesis (GB) 3 2 Distorted Humor 3 2 Sweetsouthernsaint More than 10 furlongs 5 4 Out of Place 4 4 A.P. Indy 4 4 Acatenango (GER) 4 2 Black Minnaloushe 4 2 Cape Cross (IRE) 4 3 Lord Avie 4 4 Sligo Bay (IRE) 4 3 Unusual Heat 4 0 Phone Trick 4 2 Royal Academy 4 0 Silver Deputy 4 0 Sunny's Halo 4 1 Woodman 7 to 7.5 furlongs 9 5 Woodman 8 0 Sky Classic 7 4 Devil's Bag 7 0 General Meeting 7 4 Holy Bull 7 1 Housebuster 7 2 Out of Place 7 3 Seeking the Gold 7 0 Verification 9 7 Deputy Minister 9 6 Rahy 9 6 Unbridled 10 furlongs 4 4 Silveyville 4 2 Smart Strike 4 3 Valid Appeal 3 2 Broad Brush 3 2 Deputy Minister 3 3 Easy Goer More than 10 furlongs 5 5 Conquistador Cielo 5 4 Dynaformer 4 4 Linamix (FR) 4 3 Solar City Data include progeny wins in graded, listed, and retricted stakes run in Canada, Puerto Rico, and the U.S. from January 1, 2009 to November 6,. 12 / marketwatch.bloodhorse.com

13 $ Thoroughbred Investing Low-level breeding stock Instant gratification By Shelby O'Neill Once you ve made the decision to enter the Thoroughbred business as a new owner, it may feel like an awful lot of hurry-up-and-wait. Investing in mares, yearlings, and 2-yearolds requires a substantial time lag for new owners to see their purchases wearing their silks on the track. But with a claimer, owners get a ready-made racehorse. Lava Man I think claiming horses are an excellent way for someone to start out, said Rick Cundiff, who has organized a number of claiming partnerships through his Texas-based Champion Racing Stable. Through a claiming partnership, they can decide what level of involvement they want to have, like if they want to show up on race day and sit in the clubhouse or be more hands-on and meet the trainer, go to the barn, and watch the horse work out. With a $5,000 to $10,000 budget and a desire to see a prospect make it to the track sooner than later, a claiming horse offers an owner the quickest return on investment. In a claiming race, every horse that breaks from the starting gate is available for a price. While top-tier tracks such as Keeneland and Saratoga may only offer claimers running for a $30,000 tag or greater, racing secretaries at mid-tier and lower-tier tracks regularly write claiming races for $5,000 and $3,500, and even as low as $2,500 and $1,000. New owners must keep in mind that even though their budget can accommodate a certain price tag for a claiming horse, they must also keep enough capital on hand to provide for the horse s board, training, veterinary bills, and entry fees for upcoming races. I recommend that new owners with a small budget stick to claiming partnerships and maybe buy a yearling to race now and then, said Jack Shelton, who regularly manages claiming partnerships through his On the Mark Racing. That is the only way I can see that a small partnership can make racing work and preserve their capital. People will not just keep putting money into this game and losing it. Aside from the thrill of owning a racehorse itself, Thoroughbred owners also want to see their runners succeed. With a claiming horse, owners have the option to keep running in claiming races while also deciding whether the horse can better compete at lower levels or, as all owners hope, be competitive in higher-level races, even outside of claiming company altogether. When you claim a horse, you keep an eye out there to see something you can improve on or drop down, said Glen Davis, who runs the Southwest-based Pa r a m o u n t R a c i n g Stable. You go in and out-shake four or five guys somewhere like Oaklawn Park and then take those guys over to Dallas or Shreveport. Of course, in addition to the typical risk of injury, illness, and other maladies that can plague any racehorse, a claiming horse also runs the risk of being claimed away every time the horse runs in another claiming race, which makes finding the correct level for your horse to run in competitively all the more important. A horse that performs too well at a level will likely be claimed away while a horse sorely outmatched will likely not end up earning the owner any of that elusive purse money. Many claimers over the years have gone on to win stakes races and even make racing history, such as multiple Horse of the John Henry, dual Classic winner Charismatic, and multimillionaire Lava Man. The reason to get involved in horse racing is because it s a lot of fun, Cundiff said. It s fun to win $5,000 claiming races. I can t afford to own the Dallas Cowboys, but I can own a racehorse. M benoit & associates marketwatch.bloodhorse.com / 13

14 Thoroughbred $ Investing Mid-level breeding stock Success at any level By Rachel Pagones The claiming game is a little bit like peanut butter people either love it or they hate it, but either way, it is almost always somewhere on the menu in the United States. One of the attractions of claiming horses is that success may come at any level, so that owners with modest budgets can compete fairly equally with better-financed outfits. Our budget of $25,000 to $50,000 is not at the higher end, but neither does it have to be ones at the lower level, if they re any good, have Claiming races are common in the U.S. and offer investment opportunities at many levels. been pretty much picked near the bottom, even on the major circuits. As with any type of over, and you have nowhere to go if you need to drop [the horse Thoroughbred investment, you basically have two options: Go in class]. At $25,000, you still have the possibility of getting a in solo or invest with partners. little bit of a fresh horse, and a $25,000 horse has so much more Peggy Johnson is a Southern California-based owner who earning potential. If you get two $10,000 horses, you ve got began claiming horses with various partners 20 years ago and two horses and you re now paying $6,000 per month in training bills. There is some safety in numbers, but two is not a big has enjoyed her share of success. The first horse Johnson claimed, with her then-husband Vic and two partners, won the enough number. day he was claimed and then added three consecutive victories. Zucker prefers to look for a relatively unexposed horse, The couple s greatest achievement, though, came with Southern because, he says, although everyone dreams to claim a horse Truce, a $16,000 claim who was skinny and back at the knees that s been running without blinkers and needs them, or has but subsequently won two grade I races and garnered a huge been running short and needs to go long, you re not going to profit for the Johnsons and trainer Roger Stein. find too many things somebody has missed. I m always tempted We d been claiming horses for a couple of years, and at that to dive into a young horse. For me, that would probably be the time Roger would just put us with other owners, and we d own way I would go not so much a maiden but a lightly raced anywhere from 25% to not more than 60% of the horses, says horse, one that s been showing a little talent in the morning. M 14 / marketwatch.bloodhorse.com Johnson. But there was no one else to claim Southern Truce, so it was just Roger and us, and we were in for 50%. She didn t have much pedigree so we sold her for around $150,000 if you take that plus the purse money, she made us a little over a million dollars. Later, Johnson entered into claiming partnerships with Barry Abrams, another Southern California trainer and former assistant to Stein. Initially, each partner put in $12,000, for a total of $60,000, and the group claimed two runners, saving some money for two to three months of training bills. Eventually, they ended up with seven horses. When we started, we totally relied on Barry. He s pretty good at saying what he likes about horses. Toward the end we were basically picking them, but he would say, for instance, if you re paying $40,000 for this horse, you re paying too much wait till it drops down to $32,000. In that vein, while Johnson attributes some of her success to luck, she credits much of it to her trainers. I think the most important decision you can make is picking a trainer you can trust, she says. For owners who prefer to go it alone, Santa Anita-based trainer Howard Zucker offers this advice for the investor on a smaller budget: Spend it all on one. I hate to put all my apples in one basket, but with that amount of money, it s smarter. Because $25,000 is just a midlevel horse, toward the lower third of the claiming scale out here [in Southern California]. The thing is they all cost pretty much the same to keep, but you have much less chance for profitability at the lower levels, and you need to cover expenses. Zucker adds, The reed palmer/churchill downs

15 Thoroughbred $ Investing High-level big gambles pay off Matt O Neil Like the rest of the Thoroughbred horse industry, the high-level claiming game has slowed considerably over the past few years. Since 2000 a total of 65 runners have been claimed for $100,000 or more, but only seven since January 1, There was only one six-figure claim in 2010 and none so far in. The type of runner being claimed has also changed. benoit & associates breeding stock Kilderry (outside) winning the Oceanside Stakes Of the 58 horses claimed for six figures prior to 2008, only two were claimed as maidens, the first-time starters African Treasure and Onetimeatbandcamp (both claimed for $100,000). The typical horse claimed at this level for most of the last decade had established form. Forty-five of the 58 (78%) had already earned at least $100,000 in their careers and 41 (71%) had already won or placed in a stakes race. Of the seven six-figure claims since 2008, all but one was claimed as a maiden and four were claimed out of their first starts. So far, only one of these horses, Kilderry, has shown a profit for his new owner. The son of E Dubai was dropped in for a $100,000 tag on April 4, 2008, after three tries at the maiden special level. He finished fourth that day but won three of his next four starts for his new connections, including the Oceanside Stakes, the traditional opening day feature at Del Mar. He earned more than $178,000 after switching barns. There is technically still time for the others claimed in the past three years to justify their purchases, but it doesn t look good. Only two have even started in. The overall drop in claims at the six-figure level is likely due there being fewer owners in the Thoroughbred game overall. But it s interesting that the top end of the claiming game has become more speculative while the rest of the business has gravitated towards more proven commodities. There were certainly a good number of successes last decade from the more proven runners that were claimed for six figures. Pie N Burger, for example, was haltered for $100,000 in August 2002 and went on to win six stakes, including the Lone Star Park H. (gr. III). He racked up more than a halfmillion in earnings after being claimed as well. Pure as Gold was claimed for $100,000 two months after taking the San Simeon H. (gr. IIIT). In his first start for his new connections, he held off Bordonaro at 23-1 to capture the Bing Crosby H. (gr. I) at Del Mar. Overall, 14 of the 58 (24%) six-figure claims prior to 2008 netted at least $100,000 after being c l a i m e d ( e a r n i n g s less claim price) and another 14 showed a lesser net profit, excluding of course, training costs. Fortyfive percent earned black type sometime after being claimed, so this was a good way for owners to get quick action for their money even if the economics didn t always work out. Many others among the remaining 55% were at least tried in stakes subsequent to being claimed. M February April June marketwatch.bloodhorse.com / 15 Thoroughbred Investing Series Calendar September November Horses in Training: Insights about purchasing juvenile runners at winter and spring 2-year-olds in training sales. Racing Partnerships: Joining a partnership usually requires yielding some control but also allows investors to share the risks. ling Pinhooks: In the current market economy, some investors dream of reaping profits long before the horse makes it to a racetrack. Breeding Stock: It's a long-term approach, but pedigree-minded participants often like the idea of breeding their own runners. Claiming: Perhaps the best guarantee of acquiring a racehorse is to claim a proven runner. We will offer a few words of advice pertaining to your investment level.