THE PREMIER ISSUE TABLE OF CONTENTS

THE PREMIER ISSUE TABLE OF CONTENTS Welcome Letter 1 Letters To The Editor 3 Q and A 5 Math You Can Understand 6 Concept Corner 10 Beginners Row 12 Psychology of Winning 13 Interesting Race - Algorithm Factors 14 Interesting Race - Fast Picks 17

Winnermetrics Idea Exchange is published six (6) times a year by Winnermetrics, LLC. Subscriptions are totally FREE and without obligation of any kind. Winnermetrics Idea Exchange is distributed by email. Printed copies are available at a cost of $12.00 each. All information in this publication are made for informational purposes only. Your comments and questions are most welcome. Please send any correspondence to algorithmfactors@gmail.com. Winnermetrics Algorithm Factors sheets and Winnermetrics Fast Picks sheets are copyrighted by Winnermetrics, LLC. All materials in this publication are provided by Winnermetrics, LLC unless otherwise specified. All rights reserved. No part of this work may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, or by any information storage or retrieval system, except as may be expressly permitted by the 1976 Copyright Act or in writing from the publisher. 2017 Winnermetrics, LLC

Welcome To Winnermetrics I wish to offer everyone a warm, heart-felt welcome to this premier edition of Winnermetrics Idea Exchange! As the title suggests, I hope this publication will prove to be a thoughtful and educational dialogue between like minded lovers of horse race betting. Personally, I have been betting horses since I was a teenager. I have probably read almost every book and pamphlet written on the subject. Some of the books were very interesting and somewhat helpful, but most were worthless. In the late 1970's I came across Dr. Howard Sartin. It did not take me very long to become a follower. I remained a follower for many years. It is fair to say I absolutely loved the group and the revolutionary, no-nonsense approach employed by Dr. Sartin. There is no question the Sartin Methodology helped me immensely. The Sartin Methodology brought me to the edge of long term profitability, but did not get me across the winners line. After the Sartin group disbanded I once again started to look for better answers. I did not make much progress until I came across an article in Forbes Magazine in Sabermetrics. I read about the work of Bill James and the use of Sabermetrics and I was fascinated. I immediately read the fabulous book, Moneyball, by Michael Lewis. I was instantly convinced that I could do the same thing for horse racing with my strong background in mathematics and the mathematics of gambling. I spent several months building a database of about 59 million Page 1 of 19

cells. I then ran statistical tests on the database. Initially, I did not find anything useful for my goal of winning money at the race track. I persisted and eventually was able to construct algorithms that very successfully predicted the chance of winning and finish position for each horse in the race. As an expert in the mathematics of gambling I know one thing for absolute certain. The Expected Value Equation controls the financial outcome of every single bet on any type of wager. It does not matter whether you are betting at a casino, lottery, sports game or anything else. This one formula, the Expected Value Equation, controls whether you win or lose betting horses in the long term. After I constructed the algorithms I quickly realized that I had a potential horse racing goldmine in my hands. I had an algorithm that very accurately predicted each horse s probability of winning the race. I quickly realized I had the key to finally having a consistent long-term profit at the race track because I now had the most critical component for using the Expected Value Equation, each horse s probability of winning. Along with my sons, I began to bet using the algorithms. The results were good. I did not win every day, but was able to start winning on a longer term basis. My sons urged me to offer the algorithms to the public. I had never thought about it because I built the algorithms for my personal use. I agreed that other horse race bettors may like to make use of the algorithms. So here I am. My goal is to improve how horse race players think about betting. The fact is, in my opinion, most horse race bettors do not really have a clue how to make a long term profit at the track. That Page 2 of 19

includes many of the so called experts! I know this may sound like a very foreign language to many readers. One objective of this Idea Exchange is to convert concepts into understandable English. My goal is to help everyone learn how to use the algorithms. I promise you it is possible for you to make good use of the algorithms. To know each horse s probability of winning is to be able to capitalize on the Expected Value Equation at the race track. When you capitalize on the Expected Value Equation then you consistently win at the race track on a long-term basis. It is really that simple. I could go on and on. I will that to other sections of the newsletter and to future editions. The goal here is to help you, the reader, become a consistent winner at the race track. Algorithms can do that for you. Welcome! Learn! Enjoy! Profit! Letters To The Editor This is the premier edition and I have not yet received any letters to the editor yet. However, I always receive email. Here is a question I recently received from a long time subscriber. Page 3 of 19

Dear Gary: I recently started a new job. Now, I will be working all day so I can no longer see the post time odds. Do you have any suggestions on how to play using the algorithms? J. Answer To J: I wish I had better news, but there really is no way that I can think of to maximize use of the algorithms in conjunction with the Expected Value Equation when you cannot see the actual post time odds. As you know, the ideal way to use the algorithms is to bet horses whose actual post time odds are higher than Optimal Odds. I can not think of anyway to use the algorithms if you cannot see the actual post time odds. I suggest playing night tracks, if at all possible. Try to stick with the bigger tracks with fuller fields. Delta and Evangeline are examples that usually will work well. Gary Best of Luck with your new job and playing the ponies! Page 4 of 19

Q & A Here is a question I recently received from a subscriber. Q: I have a quick question. I frequently hear you stress bankroll management. Why is that so important? A: Winning at the race track is not really about picking winners. Rather, if you want to win at the race track you have make a profit on your betting. You need a positive return on investment. So the question really becomes how do you make a profit on your betting at the race track. There are three parts to developing a positive ROI. First and foremost, you must have a way to take advantage of the Expected Value Equation. There is absolutely no escaping this truism. In order to capitalize on the Expected Value Equation you must have access to very accurate win probabilities for each horse. Then you must bet horses who will pay more than their win probabilities. Second, you must have very accurate win probabilities for every horse in the race. Obviously, I suggest the Winnermetrics Optimal Odds contained in Winnermetrics Algorithm Factors for your source of very Page 5 of 19

accurate win probabilities. I make the suggestion because the Optimal Odds are created by algorithms which have demonstrated their accuracy. Third, you must have discipline. The best way to discipline yourself is to implement a bankroll based on the Element of Ruin calculation. Essentially, the Element of Ruin is a calculation which leads you to double your bankroll before you lose your bankroll. While everyone has their own calculated Element of Ruin there is a reasonable estimate. I suggest you bet 1% of your bankroll on each bet which will minimize your probability of going broke before you double your bank. I summary, if you ONLY bet horses whose actual post time odds are higher (perhaps at least double) than Optimal Odds and you bet 1% of bankroll then you will maximize your probability of doubling your bank before losing your bank. Math You Can Understand There is an old saying that goes something like this: You can beat a race, but you can t beat the races. In my humble opinion that statement is 100% backwards. I believe the correct statement to be: You can t beat any given race, but you can beat the races. I hope to convince you that I am correct. In fact, I plan on proving to you that I am correct. It is time that people who bet horses finally begin to understand the nature of what they are doing! As a court recognized expert in the mathematics of gambling I Page 6 of 19

know for certain the Expected Value Equation controls whether you can expect to make money betting the horses. Let me explain. The Expected Value Equation can be written as follows: EV = (probability of winning) x (profit) - (probability of losing) x (loss). The formula may be known by other names and written in different forms, but this is absolutely correct for horse racing. I challenge anyone, anywhere to challenge me on this fact. Let s take a closer look. Probability of winning is simply a given horse s chances of winning the race it is running in. Profit is how much you will get paid if your horse wins after deducting the amount of your bet. Probability of losing is the inverse of probability of winning or 1 - probability of winning. Loss is the amount of your bet when the horse loses. Let s try a simple example. Assume you are interested in a horse which has Optimal Odds of 1/1. That means it has one chance of winning and one chance of losing the race it is running in. To convert that to probability of winning you put the chances of winning over the total number of chances. That would be 1 chance of winning / two total chances which is one chance of winning and one chance of losing. In other words the probability of winning is ½ or 50% or.50. Let s assume a bet of $10 and the horse has actual post time odds of 1/1. The filled in EV equation would be as follows: (.50) x (10) - (.50) x (10). Taking a closer look, working from left to right,.50 is the probability of winning, 10 is $10 which would be your profit on a bet of $10 with actual post time odds of 1/1 when your horse wins,.50 is the probability of losing which comes from 1.00 -.50, and 10 is $10 which is how much you would lose if your horse lost the race. When you solve Page 7 of 19

for EV the answer is $0. What does it mean when EV = 0? The answer is that if you bet many races where the horse has Optimal Odds of 1/1 and actual post time odds of 1/1 then you will break even long term. You would not win or lose any money over time making this bet repeatedly. Let s take another example on a horse with Optimal Odds of 4/1 and actual post time odds of 2/1. Since the actual post time odds are less than Optimal Odds the horse is overbet. Optimal Odds of 4/1 means it has one chance of winning and four chances of losing the race it is running in. To convert that to probability of winning you put the chances of winning over the total number of chances. That would be 1 chance of winning / five total chances which is one chance of winning and four chances of losing. In other words the probability of winning is 1/5 or 20% or.20. Let s assume once again a bet of $10 and the horse has actual post time odds of 2/1. The filled in formula would be as follows: (.20) x (20) - (.80) x (10). Taking a closer look, working from left to right,.20 is the probability of winning, 20 is $20 which would be your profit on a bet of $10 with actual post time odds of 2/1 when your horse wins,.80 is the probability of losing which comes from 1.00 -.20, and 10 is $10 which is how much you would lose if your horse lost the race. When you solve for EV the answer is - $4. Therefore, you must lose $4 long term for every time you make such a bet. This means you are certain to lose long term making such a bet. Let s take another example on a horse with the same Optimal Odds of 4/1 and with better actual post time odds of 6/1. Since the actual post time odds are more than Optimal Odds the horse is Page 8 of 19

underbet. That means the horse is a value bet. Optimal Odds of 4/1 means it has one chance of winning and four chances of losing the race it is running in. To convert that to probability of winning you put the chances of winning over the total number of chances. That would be 1 chance of winning / five total chances which is one chance of winning and four chances of losing. In other words the probability of winning is 1/5 or 20% or.20. Let s assume once again a bet of $10 and the horse has actual post time odds of 6/1. The filled in formula would be as follows: (.20) x (60) - (.80) x (10). Taking a closer look, working from left to right,.20 is the probability of winning, 20 is $60 which would be your profit on a bet of $10 with actual post time odds of 6/1 when your horse wins,.80 is the probability of losing which comes from 1.00 -.20, and 10 is $10 which is how much you would lose if your horse lost the race. When you solve for EV the answer is + $4. Therefore, you must win $4 long term for every time you make such a bet. This means you are certain to win long term making this type of value bet. The lesson to be learned is you can ONLY win if you are betting VALUE horses! You can ONLY know if a horse is a VALUE horse if you have very accurate probability of winning ratings for each horse in the race. Period! End of story! I sincerely hope you are now convinced that you can really beat the horses long term. Page 9 of 19

Concept Corner There is good news and there is less good news. You do not have to understand the concepts of Winnermetrics to win at the race track using Winnermetrics. The less good news is it helps to understand the concepts. Let s get started. I am suggesting you do something very difficult. Forget everything you know about horse racing! Why? How has your knowledge been working for you so far? Here is the real problem. There is total failure of the betting public and so-called experts to understand what betting horse races are actually about. If you think betting on horses is about picking winners then I say you do not have a clue. I mean absolutely no disrespect. The truth is betting horse races is not about picking winners. In fact, the best horse in the race does not always win so there are many races where can you can pick the best horse in the race and lose. In my humble opinion the purpose of betting horse races is to make money. Lots of money! Page 10 of 19

Before you say I am crazy, please let me explain. Remember, I can prove everything I say here through the use of mathematics. Let s compare the two purposes. You MUST start with the Expected Value Equation because the equation absolutely controls whether you win or lose long term. I say long term because anything can happen in the short term. Consider the following: If your purpose is to pick winners then your measure of success is to pick more winners and improve your rate of winning. That is what most people think betting horse races is all about. If your purpose is to make money then your measure of success is to make more money and improve your money won per race. Which one of those two purposes works with the Expected Value Equation? Remember, your goal must correlate to the Expected Value Equation because at the end of the day the equation controls your final outcome. The answer, of course, is your purpose in betting horse races must be to make money. Where is the proof? You can actually control how much you win by controlling the expected value you demand when betting on a horse. For example, in the Expected Value Equation example above EV = +$4 when we bet the overlay going off at 6/1. The fact is you can control what you demand in terms of EV. The higher EV you demand the more money you will win. There is no such equivalent ability in trying to control your win percentage. So trying to improve your ability to pick winners will not lead you to profitability long term because you are not controlling for expected value. I hope I have started you on a course of thinking about making money. The purpose of betting horse races is to make money. Lots of Page 11 of 19

money! Beginner s Row Since this is the premier edition it is appropriate to discuss where to begin when using Winnermetrics. The answer is simple. Begin with Optimal Odds. At the beginning of the day and at the end of the day Winnermetrics is all about successfully taking advantage of the Expected Value Equation. The way you do that is by comparing Optimal Odds for each horse in the race with the actual post time odds for each horse. The real question is how do you determine when to pull the trigger and make a bet. There are two situations where the answer is obvious. When the actual post time odds are a few times Optimal Odds or better then you almost always want to make a bet. I personally suggest requiring minimum odds of at least 5/1. The other situation that is obvious is when the actual post time odds are less than one-half Optimal Odds. You will not bet in that situation because the horse is so heavily overbet. As a beginner it is best to stick to bets where the actual post time odds are at least double Optimal Odds and the actual post time odds are at least 5/1. It is also useful to see if there is a valid bet on another horse beside the favorite when the favorite has actual post time odds of less than one-half of Optimal Odds. I always refer to actual post time odds, but that means to make your bet as close as possible to post time. Odds will fluctuate and even change as the race is running sometimes. Such movement is beyond Page 12 of 19

your control. Psychology Of Winning I am not a psychologist and do not pretend to be one. However, I can repeat some thoughts that I learned from Dr. Sartin and others. I can also relay some of my personal experiences. There is one concept that Dr. Sartin said that I originally thought was kind of crazy. Dr. Sartin said that when you bet too much money for your comfort level you could feel a slight physiological change in your body if you paid attention. You might feel your breathing start to change, blood pressure rising, or wetness of your mouth changing. I, for one, can confirm what Dr. Sartin said was true. Dr. Sartin said when you bet too much money then you change your thinking without even realizing it. When you bet too much money for your comfort level then you will change which horse you bet or become too loose with your money. The amount of money varies from person to person. For some people betting $5 may be too much. For some people the amount may be $500. Page 13 of 19

Winnermetrics helps with this issue. Winnermetrics makes a very strong recommendation that every bettor take advantage of the Element of Ruin by flat betting 1% of bank for every bet. This works as follows: establish a bankroll, keep the bankroll separate from your household money, bet 1% of bankroll, and continue until you double your bank. This process is not glamorous or exciting. However, it will help make you successful. Interesting Race - Winnermetrics Algorithm Factors We are going to look at the 10 th race at Gulfstream from February 16, 2017. A copy of the actual Winnermetrics Algorithm Factors for the race are attached to the email for those who do not already have a copy. The starting point is always a comparison of actual post time odds to the Optimal Odds. Here is a chart: P# OO AO 1 6 7/2 2 46 60 3 17 8 4 41 16 5 10 3/2 6 10 7 7 32 30 8 5/2 7 9 2 4 Page 14 of 19

Without looking at anything else we begin to make decisions. P# Comment 1 Too low to bet because about one-half OO and below 5/1 2 Alive so far 3 Too low to bet because less than one-half OO 4 Too low to bet because less than one-half OO 5 Too low to bet because less than one-half OO and 3/2 6 In the gray zone so far 7 Alive so far 8 Alive so far 9 Alive so far On the basis of a comparison of Optimal Odds to actual post time odds we are only interested in horses 2, 6, 7, 8, 9. The rest will result in a long term losing bet based on the Expected Value Equation. Now we have to decide whether to pull the trigger and place a bet. When we place a bet the amount will be 1% of bankroll to win. The second step is to look at Relative Strength Rating (RSR) and all of the supplemental ratings in order to make a decision on whether to place a bet. Here are the thoughts: P# Comment 2 Very hard to bet. This horse has the worst OO and RSR in the race. This horse is less than double OO. No bet. 6 In the gray zone and no strong ratings. This horse has its best T score at T3 so I look at BL3 to see how the horse fits. The horse has the fourth best BL3 which is not strong Page 15 of 19

enough to make a best, especially with odds in the gray zone. 7 Whopper Trainer Value Play (TVP)! Horrendous T1 and BL1. Not sure what happened, if anything. However, the horse finished with the best BL3 in the race. Combining TVP and BL3 with actual post time odds equal to OO the horse is a bet. 8 Best T1 in race converts to best BL1 in the race, but that is not sustained to BL2 or BL3. However, the Expected Value Equation is in very positive territory where actual post time odds are much better than OO by more than double. The horse is a bet at 7/1. 9 Actual post time odds are less than 5/1 which is not preferred. T scores are marginal. BL scores are also marginal with a BL3 of 0. Nothing to really compel a bet. The two bets for this race are 7 and 8. Here are the results. 7 $65.80 31.00 13.40 4 17.60 12.20 6 6.00 $2 exacta 7/4 $659.80 $2 trifecta 7/4/6 $11,426.80 Page 16 of 19

Interesting Race - Winnermetrics Fast Picks We are going to look at the 4 th race at Mahoning Valley from February 6, 2017. A copy of the actual Winnermetrics Fast Picks for the race are attached to the email for those who do not already have a copy. The starting point is always a comparison of actual post time odds to the Optimal Odds. Here is a chart: P# OO AO 1 3/5 4 2 3/5 2 3 3/5 5/2 4 8 41 5 SCR SCR 6 3 38 7 NL NL Not Listed In Fast Picks 8 3/5 2 Without looking at anything else we begin to make decisions. P# Comment 1 Alive so far 2 Too low to bet 3 Too low to bet 4 Alive so far 5 Scratched Page 17 of 19

6 Alive so far 7 Not listed at all in Fast Picks 8 Too low to bet On the basis of a comparison of Optimal Odds to actual post time odds we are only interested in horses 1, 4, 6. The rest are just too low to bet and will only result in churning your money. Now we have to decide whether to pull the trigger and place a bet. When we place a bet the amount will be 1% of bankroll to win. The second step is to look at Relative Strength Rating (RSR) and all of the supplemental ratings in order to make a decision on whether to place a bet. Here are the thoughts: P# Comment 1 This horse is certainly competitive. In a route race it is best to look for a horse rounding into form. I like to see adequate representation in the overall category and the other three race related categories. This horse has two second column and two third column marks in the overall category which is adequate. This horse is a stretch runner in a route which I consider a little harder to win than average. The odds are only 4/1 which is a little low for me. I will take 4/1 here. 4 This horse only has one third column in the overall category which is a little light for me. In the early part of the race there is one best in race and two third column scores. There is only one third column in the turn section and nothing in the stretch section. This horse is a huge overlay. However, I cannot bring myself to bet it. The horse is not showing Page 18 of 19

enough strength. 6 This horse is an unbelievable overlay paying more than twelve times OO! I almost fell over when I saw the odds on the screen at the off track betting parlor. This horse has two second columns in the overall category. This is a little light. There are no early columns, but all four columns on the turn and all five columns in the stretch. The horse is clearly a contender and deserves a bet from every perspective. The two bets for this race are 1 and 6. Here are the results. 6 $79.20 21.00 9.60 2 3.60 2.60 1 3.00 $2 exacta 6/2 $236.60 $2 trifecta 6/2/1 $795.00 Page 19 of 19