History:

Parimutuel betting was invented in 1865 by the French perfume maker Pierre Oller when he was asked by his friend to develop a betting system that would be fair for betters and would also provide a stable profit to bookmakers.

Parimutuel betting involves many calculations, and to ease the job of bookmakers, a mechanical device called totalisator or tote board was invented. Such device first appeared in 1913 at Ellerslie Racecouse, Auckland, New Zealand and quickly became widely used all around the world.

Nowadays, parimutuel betting is often regulated by state government and is available in many places, where other forms of gambling are illegal. Apart from bookmakers offices at racing tracks, there are quite many off-track facilities that are located somewhere else, but accept bets on events bettors probably are not going to watch in person.

What is it?

Unlike casino gambling, in parimutuel betting, gamblers do not play against the house, but bet against each other. Bookmakers have fixed commissions and do not impede any strategies applied by players. A whole science called handicapping deals with determining the outcome of races.

For a skilled player it is more then possible to win more money than the majority of bettors, but it is still not enough to profit from parimutuel betting. Taxes, bookmakers takes and breakage reduce the odds of all players a great deal, which makes winning money in the long run quite a difficult task.

Independent off-track offices described above usually have smaller take and therefore offer better odds, but in many countries they are illegal and do not exist. Another way to enjoy parimutuel betting with even higher odds is carryint it out online. Internet bookmakers and betting exchanges are run off-shore and have lower taxes. Except that, the maintenance of an internet site costs much less than of a land based office, so internet bookmakers also have smaller takes. When takes of traditional parimutuel betting offices are 15-18 percent, an internet site may have as little as 1-2 percent take, which is low enough for a skilled bettor to profit from parimutuel betting.