Archives for September 2011

The ultra-upscale ForbesLife magazine comes as an occasional supplement to the bi-weekly Forbes. The September 11 issue of ForbesLife has an article by MaryJean Wall, the former turf columnist for the Lexington (KY) Herald-Leader. It is titled “So You Want to Buy a Racehorse.” [click here to access the article] Ms. Wall discusses the modern history of the Keeneland sales and provides anecdotes about Sheikh Mohammed bin Rashid Al Maktoum of Dubai, Mike Repole of Queens, and the late Roger King of CBS Television Distribution.

I was at the Saratoga Select Sale several years ago and King was in a bidding contest with one other person. When the other bidder approached King about buying the colt together in partnership, the blunt King told him for all to hear with colorful language what he thought about the idea. King then bought the colt by himself.

MaryJean Wall is a three-time Eclipse Award-winning reporter and writer. She holds an earned doctorate in American history and her excellent 2010 book How Kentucky Became Southern (University of Kentucky Press, 241 pages) blends her interests in both horse racing and history. I read the book and found it to be informative and well written.

A friend of mine last week was telling me about the yearling Hanoverian she purchased for her daughter to be used eventually as a hunter/jumper. I asked what the plans were and she said that the filly would be readied to ride when she is a 3-year-old. The idea is to wait until the youngster has had time to develop and mature, which evidently is the norm in all performance horses except racehorses.

My friend was too polite to say so, but I could tell that she was contemptuous of the way racehorses are rushed to the track.

I thought how different this philosophy is from the prevailing Thoroughbred culture. Outstanding Thoroughbred colts are routinely retired at the end of their 3-year-old season when horses of this age in other performance breeds are just getting started. Similarly, yearlings sold at sales in the late summer and fall are often racing by a year later, whereas two-year-olds in various other breeds may never have had on a saddle.

Several days after having this brief conversation with my friend, the Wall Street Journal published an article titled “Not So Fast: Critics Decry Horse Auction Experience.” It was an expose of sorts pertaining to the 2-year-old in training breezes held by Fasig-Tipton and the Ocala Breeders Sales Company. The article reported that “…two horses died in such exercises earlier this year.” As expected, PETA is opposed to the modus operandi, but, significantly, so are some credible horsemen from within the Thoroughbred enterprise.

In an ideal world, the Thoroughbred sport would add one more year. A racehorse would not be eligible to start a race until his or her 3-year-old year and the Triple Crown races would be for 4-year-olds. Under the current rules, a horse can run in the Triple Crown races even if he is a late foal and is not yet 3-years-old. How many of the entrants in this year’s Kentucky Derby are still in training? Certainly not the winner.

These changes are obviously not going to happen because of the underlying economics and the tradition of glamorizing 3-year-old races. For example, it is not likely that a partnership would do very well by buying yearlings that the partnership prospectus states won’t race until they are at least 3-year-olds.

However, that does not mean that changes should not be made in the marketing and preparation of young horses, as long as the modifications are based on strong evidence and not on emotion. It would be helpful, for instance, to know how graduates of 2-year-old in training sales turn out as compared to animals that are not sold in this manner. On average, how many actually make it into a race and how much do they earn? Is a horse’s ability to run fast for a very short distance predictive of future performance in a race?

Some well-known trainers, past and present, have made a name for themselves primarily with older racehorses. Charlie Whittingham did not win the Kentucky Derby until late in his life and, furthermore, rarely tried. Bill Mott and the late Bobby Frankel are/were not regulars in the Triple Crown races but are in the Hall of Fame.

These trainers generally don’t get the acclaim that goes to their higher profile colleagues who, year after year, have Triple Crown entries and a plethora of young horses to choose from. Fortunately, some owners appreciate the discipline it takes for a trainer to bypass the limelight while waiting on an immature 3-year-old to realize his or her potential as an older horse. There is much to be said for giving a fledgling racehorse time to grow one more year. It is good for the horse and good for horse racing to have older stars.

Copyright © 2011 Horse Racing Business

Prior to every major American Thoroughbred sale, the Blood-Horse and Thoroughbred Times typically ask various consignors and buyers how they think the sale will turn out. The most recent example pertains to the Keeneland sale of yearlings that began on September 11, 2011.

Robert L. Losey, a professor in the Equine Business Industry program at the University of Louisville (KY) has developed a statistical model to attempt to predict results. He explains his model on his website. Briefly, Dr. Losey employs two variables—level of racing purses and the S & P 500 index—to forecast what the average price will be at a sale. Using data going back 20 years, these two metrics account for 80% to 90% of the variability in average price.

One of the findings is “that both the Keeneland September and the overall North American yearling averages are less variable than the major stock market averages, typically moving either up or down by about 70% of the changes in the S&P 500…”

The professor’s model is signaling that the current Keeneland yearling sale will have an average price that is one to four percent greater than in 2010.

Dr. Losey will post daily updates showing how the 2011 sale is comparing with the 2010 sale.

http://www.rllosey.info/