How This Man Profited $1 Billion Betting on Hong Kong Horse Races
Oct 9, 2026 · 37 min · 35 segments
Learn more about your ad choices. Visit megaphone.fm/adchoices
- Show signals
- SuitabilitySafeBiasCenterAudience≈19k followers
Oct 9, 2026 · 37 min · 35 segments
Learn more about your ad choices. Visit megaphone.fm/adchoices
The state gambling monopoly.
Its two courses, Happy Valley and Sha Tin, were packed twice a week during racing season that extended from September to July.
Hong Kong's population was only about 5.5 million at the time, but it bet more on horses than the entire US population, reaching about $10 billion annually by the 1990s.
Hong Kong's racing used a paramutual, also known as a totalizer, or an exchange system.
Unlike odds at a regular bookmaker, which are set in advance and give a decisive edge to the house, paramutual odds are updated fluidly and in proportion to market betters wages.
Winners split the pool and the house skims a commission of about 17%.
This is remarkably similar to a stock exchange.
The exchange itself just facilitates the exchange of money and securities but does not get involved in their price at all and makes a profit only by charging fees on the exchange.
But all of this was to say, to make money, Benter would have to do more than just pick winners.
He needed to make bets with a profit margin greater than the club's 17% cut.
This was a surprisingly tall order, considering that most gamblers are expected to lose about 20% of everything that they gamble on horses.
Benter needed guidance on how such a system might work.
He went to the Gambler's Book Club at Vegas and bought everything he could find on horses.
There were lots of systems promising incredible results, but to him they seemed a bit flimsy.
Most had been written by germilists or amateur handicappers.
Few contained real math.
Benter wanted something more rigorous, so he went to the library of the University of Nevada at Las Vegas, which kept a special collection on gaming.
Buried in stacks of periodicals and manuscripts, he found what he was searching for, an academic paper titled, Searching for Positive Returns at the Track, a Multinomial Logic Model for Handicapping Horse Races.
As thrilling as that sounds, this is all what it meant.
A horse's success or failure was a result of factors that could be quantified statistically.
Take some variables like straight line speed, size, winning record, the skill of the jockey, the weather on the day, the condition of the track, etc.
Weigh them in terms of how much they are likely to impact the outcome and presto, outcome a prediction of the horse's chances of winning.
More variables, better variables, and finer weightings improve the predictions.
The authors of the book actually weren't sure if it was possible to make money using this strategy, and being mostly interested in statistical models, they didn't try that hard to find out.
The state gambling monopoly.
Its two courses, Happy Valley and Sha Tin, were packed twice a week during racing season that extended from September to July.
Hong Kong's population was only about 5.5 million at the time, but it bet more on horses than the entire US population, reaching about $10 billion annually by the 1990s.
Hong Kong's racing used a paramutual, also known as a totalizer, or an exchange system.
Unlike odds at a regular bookmaker, which are set in advance and give a decisive edge to the house, paramutual odds are updated fluidly and in proportion to market betters wages.
Winners split the pool and the house skims a commission of about 17%.
This is remarkably similar to a stock exchange.
The exchange itself just facilitates the exchange of money and securities but does not get involved in their price at all and makes a profit only by charging fees on the exchange.
But all of this was to say, to make money, Benter would have to do more than just pick winners.
He needed to make bets with a profit margin greater than the club's 17% cut.
This was a surprisingly tall order, considering that most gamblers are expected to lose about 20% of everything that they gamble on horses.
Benter needed guidance on how such a system might work.
He went to the Gambler's Book Club at Vegas and bought everything he could find on horses.
There were lots of systems promising incredible results, but to him they seemed a bit flimsy.
Most had been written by germilists or amateur handicappers.
Few contained real math.
Benter wanted something more rigorous, so he went to the library of the University of Nevada at Las Vegas, which kept a special collection on gaming.
Buried in stacks of periodicals and manuscripts, he found what he was searching for, an academic paper titled, Searching for Positive Returns at the Track, a Multinomial Logic Model for Handicapping Horse Races.
As thrilling as that sounds, this is all what it meant.
A horse's success or failure was a result of factors that could be quantified statistically.
Take some variables like straight line speed, size, winning record, the skill of the jockey, the weather on the day, the condition of the track, etc.
Weigh them in terms of how much they are likely to impact the outcome and presto, outcome a prediction of the horse's chances of winning.
More variables, better variables, and finer weightings improve the predictions.
The authors of the book actually weren't sure if it was possible to make money using this strategy, and being mostly interested in statistical models, they didn't try that hard to find out.
The rest of this transcript — segmented and speaker-labeled, so you land on the exact moment something was said
Search every transcript — by keyword, by phrase, or by meaning, across every show Radar indexes
Trends — what is surging across podcasts, measured against its own baseline
Alerts — when a name you follow appears in a newly indexed episode
No account is needed to search Radar.