Tote Arbitrage and Lock Opportunities in Racetrack Betting
David C. Edelman and Nigel R. O'Brian
Research Report 2001-10
Date: 17 October 2001
We describe a game-theoretic approach to the investigation of
arbitrage opportunities based on combinations of exotic wagers for the
same event. This situation is also known as a lock or Dutch
Book. We apply the technique to recent totalisator data from
Australian thoroughbred races. It appears that such opportunities
appear fairly regularly, at least according to published final
dividends for various bet types. We demonstrate the method in some
detail on a particular example.
Dutch Book. lock. arbitrage. zero-sum game. minimax. totalisator.
pari-mutuel. gambling. bet. wager. racetrack.
AMS Subject Classification (1991)
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Sydney Mathematics and Statistics