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Rule 4 Calculator Guide

  • Updated
One of the most common questions we are asked is 'Why hasn't my bet returned as much as I expected?' Commonly this is due to another horse withdrawing and the price of the horse you Backed reducing in price. This is due to Rule 4 being applied. This guide contains a video that explains how to use the Rule 4 Calculator.

 

Rule 4 was brought in to compensate for the withdrawal of a horse from the race. When a horse withdraws from a race, all of the other horses in the race will reduce by a percentage amount. If we look at the rule in his most simplistic terms, if we Back a horse at odds of 6.0 and the favourite horse is priced a 2.0.

Then an hour before the race, the favourite pulls out of the race. Previously our horse was priced at 6.0, it will now be reduced in price as the probability of it winning will be improved. How much it is reduced by is the Rule 4 deduction.

Different priced horses will result in different reductions. If a horse with low odds withdraws, say odds of 1.5, then your horse's price will reduce by a greater amount than if a horse of odds of 14.0 withdrew.

 

The table below shows the amount that horses will be reduced by : 

 

If we return to our example above where we Backed a horse at odds of 6.0 and a horse in the same race at odds of 2.0 withdrew, we would need to apply a 45% reduction to our horse. To do this we perform the below calculation (don't worry about learning this, the OddsMonkey Rule 4 calculator will do it for you):

(Decimal odds - 1 ) x (1-decimal reduction factor) + 1

(6 - 1 ) x (1- 0.45) + 1 = 3.75



Where previously our horse was odds of 6.0, our horse's odds are now at odds of 3.75. There are 2 key things to note at this stage:

  1. If a horse is priced at odds of 15.0 and over, the price of your horse will not reduce in price.
  2. Rule 4 only applies to bookmakers odds. To calculate the exchange change in price, read below...

 

Horse Withdrawals And The Betting Exchanges

The Betting Exchanges work in a different way to the bookmakers. When the market is loaded each horse is given a 'Reduction Factor', based on a forecast price, which is expressed as a percentage.

Once a horse is withdrawn, the reduction will be applied to all of the horses in the race. E.g. the picture shows the reduction factor applied if the horse 'Believable' was to withdraw. We can see that all of the other horses in the race would be reduced by 16.16%.

If you have matched bets on the horses at the time, the amount which the horses reduce by is usually around the same and you need not worry. There will be times when you will be a few pennies up or down, but over time, this will even itself out.