OVERLAY, IS THERE REALLY SUCH A BEAST?

I don't know how many times I've read about overlays in handicapping books.

I don't know how many times I've heard a player say at the track, "I got on overlay on that one."

I sometimes wonder if there is such a thing as an overlay.

I mean, you say you have an overlay. But can you prove it.

So you bet a horse at let's say 8-1. He comes in sixth after a mid-pack trip in which he could hardly be bothered to lift his head.

That's okay, you tell yourself, I got an overlay.

What's the difference between getting an overlay an losing?

Supposedly an overlay means the price was higher than it should have been. Supposedly an overlay is a bargain.

But losing an overlay and then telling yourself you did the smart thing is like going to the store, buying a pair of shoes from the bargain bin, and then finding once you get home that they're made of cardboard. You can't wear them at all. You've totally wasted your money.

Do you tell yourself you "got an overlay" on the shoes?

Overlay sometimes sounds to me like a rationalization for bad luck, bad handicapping or wishful thinking. It's a way of telling yourself you made a good bet when in fact you've probably made a bad one.

Yes, sure, there is such a thing as an overlay, sort of. A claimer that won its last race by two lengths and jumps up a level probably shouldn't be 20-1.

Probably. Let's say this horse goes off in his next claimer and fades to fifth. Does it really make any difference if he was 20-1 or 3-1?

Sure, if you regularly cash longshot tickets on angles you've worked out, you can talk, maybe, about overlays -- but only if you've made a handsome profit.

There's a fallacy inherent in the way some people think about overlays. I know a big-time player who sometimes reasons like this:

Jockey Joe Whip wins 20% of his races.

Joe's on a horse in the next race that's paying 8-1.

The break-even odds on Joe are 4-1.

Therefore, the player reasons, I've got myself a 100% overlay.

He rushes to the windows.

There are at least two problems with his reasoning:

1) Jockey Joe Whip probably wins most of his races for a few select trainers who give him their better mounts. He's not 20% on any old horse.

2) Yes, Joe is a 20% jockey, and the "natural odds" on him are 4-1 in any race. But if you look at the races he actually wins, you'll find that the vast majority of them are won at LESS than 4-1. You might well find that Joe has ridden 12 horses at 8-1 this meet, and never won with any of them.

For the exact same reason, it doesn't work to bet overlays on a horse's life record. Let's Say Stable Princess is 16-4-4-4 for her career. You're thinking she loses 12 races, and wins 4, so she's 3-1. Today she's 6-1 so you've got an overlay.

But the reason she's 6-1, very likely, is that she's ascending the class ladder and is now running into tougher horses than ever. Yes, she was 3-1 for races she's already won, but those were likely easier races.

And if you check her records, you'll likely find that those 4 wins came at modest, if not pitiful mutuels. And that every time she ran at higher than 5-1 she was shut down.

So overlay, man I don't know. Maybe it's better just to say, "I lost the race."