The Retro-Graded Stakes Formula

A considerable amount of racing chatter recently has been about the quality of certain graded stakes races and how their winners have been little more than (well-)paid workouts for the horses and their connections. I’m inclined to agree – top class races should attract many horses of a certain caliber but the graded stakes field size is, on average, one of the smallest in the sport. (Allowance races are not far behind – claiming and lower-level turf races attract the largest fields).

What’s at issue here is “black-type”: when a horse (or his/her progeny) go to sale, having placed in a graded-stakes race can mean a considerable premium to their auction price. This makes total sense – thousands of horses of all ages are sold each year and the bold, sometimes ALL-CAPS,  font in the sales catalog allows buyers to assess the potential class of the [yearling/two-year-old/mare/stud prospect] they are buying at a glance without reviewing a lifetime of past performances. It’s an elegant solution to a problem that existed before the Internet and electronic data was a thing, and retains some value to this day.

The American Graded Stakes Committee (AGSC) is the “be-all-and-end-all” determiner of what races get the vaunted Graded Stakes designation, those that can get the BOLD CAP font in a sales catalog. The Thoroughbred Owners and Breeders Association (TOBA) controls this designation, of which their policies can be found here. To their credit, the AGSC has been quite responsive to upgrading the designation of races that have shown considerable improvement in the quality of horses running in them over the years. The best example, given my familiarity with them, is the upgrade of the Arkansas Derby for 3 year olds to Grade 1 status and its preps (the Rebel and Southwest) to G2 and G3 status, after the likes of Smarty Jones, Afleet Alex and Curlin used the Oaklawn route to prep for later classic wins.

My main criticism of the AGSC is that, while they have been responsive to upgrades, they have been much less so to downgrading races that haven’t been as good. It’s a natural response for well-meaning decision-makers: demonstrable class deserves and upgrade, suspect class deserves just one more chance. That bias has produced what I would call class “creep” whose end result is too many graded stakes with too small fields and, frankly, too many horses earning graded black-type. The AGSC uses “gut feel” more than data to determine the top quality races, which has contributed to the bias.

The main trend driving this is the declining North American foal crop, which has shrunk from a high of 40,000 in 1990 to 25,000 this past year (Source). The number of Graded Stakes has remained steadily above 450 for the last seven years despite the falling foal crop and the number of races run in North America. This means its roughly 40% easier today to earn black-type than it was just a few years ago. The AGSC has not been responsive enough to these trends; the impact is that black-type means less and less.

The fix I propose leverage the unique power of the age in which we live – use the vast information collected about races, and the past and future performance of the horses that run in them, to determine black-type. More importantly, tie the total number of graded stakes to a reasonable estimate of the foal crops eligible for those races. Lastly, tie the earning of black-type from placing in a graded stakes not to the horse’s placing, but the number of contenders the placing horse beat to earn it. What results is what I call the Retro-Graded Stakes Formula. These are the guidelines I’d suggest:

  • In 2006, roughly 100,000 thoroughbreds (3 years of foal crops) would have been eligible for graded stakes eligibility, or roughly 1 GS for every 210 born (100K/475) . Let’s be generous and say that a GS win should be available for every 200 foals.
  • Black-type is especially valuable for fillies and mares, but their graded stakes representation is outsized compared to the open races for which they are eligible. If fillies and mares are eligible for all graded stakes, but colts, geldings, and horses are eligible for all, then gender-restricted graded stakes should represent just one third (33%) of all graded stakes – currently, 41% of Graded Stakes are gender-restricted.
  • Many graded stakes are age-restricted, so tying them to the eligible foal crop makes sense. For 2- and 3-yos in a foal crop of 24,000, that means just 120 graded races to split between the 2- and 3-year-old races, and only 40 for fillies and mares. Currently, there are 184.
  • Open company races, having a larger eligible foal crop, would get a majority of the graded stakes races. This aligns with the industry desire (supposedly) for keeping horses running at a later age.
  • Field size matters in a stakes race – it is easier to place in a 5-horse field than an 8-horse field, naturally. To earn black-type, require that a horse beat at least 60% of the field they are in. For a 4-horse race, only the winner earns black type. In a 5- to 7-horse race, top 2. Only in a field of 8 or more can an ITM guarantee black-type.
  • The total number of graded stakes would shrink to the foal crop of 3-4-5 year olds/200 (roughly 360, based on 2011-2013)  but distributing those more to open company races versus any kind of restriction. If there are 120 age-restricted races, there would be 240 without.

The above proposals are conditions that the AGSC could implement today. The biggest change, however, would be to use the past and future performances of race horses to determine the true class of a race. This would take some doing. The RGSA would assign a provisional class to a race before its run based on its current historical standing, determined by prior class of the horses in it. For example:

  • A race could be graded a PG[1,2,3], meaning a Provisional Grade 1 (2 or 3) based on the level of horses who have run in it, and their subsequent performance. Minimum purse sizes would be required – the AGSC gets this right.
  • After a suitable period of time, probably 3-6 months, the race would be graded RG[1,2,3] , again based on both the past and subsequent performance of its entries. The total number of RG races will be tied to the eligible foal crop for that race.
  • One revision to a races grade would be allowed should multiple horses from the race go on to greater things.
  • Ungraded stakes could get bumped to RG status (and future PG status) if multiple performers win subsequent RG contests.
  • Allowance level races with multiple past and future RG performers could get special “Key Race” status that could be noted in a catalog page.

I am not suggesting that the AGSC adopt these changes; though that might be ideal, it would be too radical a change. I’m saying that any group with data and sufficiently publicity could use the RGSF to challenge the status quo with regard to the class of sales horses. The AGSC has no competition – it’s time they had some.

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2013 Kentucky Derby Trail – Historical Pedigree Statistics

I had an interesting exchange last week following Pool 1 of the Kentucky Derby Future Wager, where I supported Code West in the pool over a very good horse who had just beaten him, Super Ninety-Nine (running today in Oaklawn’s Southwest Stakes).

@mikedorr77 @ejxd2 you are tough on pedigree. Pulpit out of Unbridled’s Song mare isn’t hopeless at 1 1/4. Staying together bigger concern.

— jeremyclemons (@jeremyclemons) February 11, 2013

Jeremy is right, when it comes to the Kentucky Derby, I am tough on pedigree. Last year, my inaugural post on pedigrees and the Kentucky Derby highlighted this odd fact; neither the two premier U.S. stallions of the last 25 years, Storm Cat and A.P. Indy, nor their siring progeny have produced a Derby winner. I made the contention that certain horses were bad bets in Kentucky Derby wagers because of that fact, that the entries representing those lines were underlaid as a result. I regret not having a more rigorous analysis to back that contention up, but good historical racing data is either expensive or laborious to obtain.

Twitter has been a bottomless source of handicapping insight and enthusiasm for the sport, and recently it provided a contact that has a passion for data and, I assume, a little free time to fulfill this request:

I appreciate Alex Campbell of Ontario Thoroughbred for coming through with a great data set with 331 entrants. I traced back each entrant to 8 distinct common ancestors or an “other”. Since 1997, for example, 87 descendants of the exemplary stallion Northern Dancer have entered the starting gate, but a full 32 of them are through his grandson Storm Cat. Similarly, Bold Ruler (who dominated Derby Pedigrees from before Secretariat to after Spectacular Bid) has had 44 representative runners since 1997, but all but 9 of them are by great-grandson A.P. Indy.

The sire that appears most often on top of Derby pedigrees is Mr Prospector, from the same foal crop (3 y.o. of 1973) as Secretariat and Forego. It may not seem fair comparing an older sire (first crop in 1976) to more recent ones (Storm Cat, 1989; A.P. Indy, 1997) but Mr. P’s Derby starters come through multiple sons, most notably Fappiano, through whom are a full third of the Mr P line representatives. Breaking out the Fappiano line seemed like a natural extension for the analysis.

Having identified common ancestry, I grouped by sire all Derby runners since 1997 (the first eligible crop for A.P. Indy). I calculated average finish, % of runners and handle wagered, and the ROI for a $2 bet on all entrants. The results are fascinating, confirming some suspicions but providing new insights as well.

Sire Lines with 20+ Derby Runners Since 1997

Sire Line

Runners

% Runners

% Pools

Pool / Rnrs

$2 ROI

Wins

Top 3

Exp. Top 3

Avg Finish

A.P. Indy

35

11.9%

13.6%

1.14

-2.00

0

4

7

10.7

Storm Cat

32

10.9%

8.8%

0.81

-2.00

0

5

4

10.5

Fappiano

30

10.2%

11.2%

1.09

2.20

2

8

5

8.4

Northern Dancer

45

15.4%

14.5%

0.95

-0.32

2

6

7

10.4

Mr. Prospector

65

22.2%

23.8%

1.07

0.21

6

11

11

9.1

Turn-To

22

7.5%

6.8%

0.90

-1.26

1

3

3

9.2

All Other

64

21.8%

21.2%

0.97

0.81

5

11

10

9.9

Total

293.0

-0.15

16

48.0

9.2

For A.P. Indy, the chart above says this – the AP Indy sire line has had 35 Derby entrants since 1997, which is 12% of total runners. 14% of all win dollars wagered were on APs, which is 14% more than the average runner. The line has no wins (so an ROI of -2.00) and 4 top 3s, but based on win pool dollars, we would have expected 7. AP Indy line runners have an average finish of 10.7, which is 1.5 positions behind the average finish position of 9.2

In summary, A.P.  Indy and his sons have accounted for 12% of Derby runners; those have been overbet, have not won, and have underperformed relative to expectations. I cannot say why, as the AP Indy line is known for a good balance of speed, stamina and brilliance. The line’s runners have performed well in the other two legs of the Triple Crown. I think it a genuine mystery in handicapping the race.

Storm Cat descendants are a bit more surprising. They have the same goose egg in the win column, but have five top 3s, one more than expected.  The line’s runners are generally underbet to expectations, by nearly 20%, and are not quite the money-burners I have accused them of being (just don’t bet them to win). I may only speculate, but the precocity of the Storm Cat line (and subsequent wins in 2-year-old graded stakes, often sprints/miles) have helped many make it to the Derby. Their mid-spring form, however, has been eclipsed by others and bettors have fully factored that in to their chances. It may turn out that the new Derby points system disadvantages these runners more than others.

Mr. Prospector (including Fappiano) is clearly a major influence – 32% of runners, half (8) of the winners, and 40% of in-the-money finishes. The Fappiano line (that includes sires Unbridled, Quiet American, Birdstone, Candy Ride and Empire Maker, among many others) stands out with two wins (Real Quiet and Mine that Bird) but another six in the money finishes (including Bodemeister and Dullahan last year). It’s the only major sub-line of Mr. Prospector line that is somewhat heavily bet (about 10% more than average) but has a positive ROI if betting all runners. (A word of warning, however – the ROI on the Fappiano line includes the $103 mutuel for Mine that Bird).

The non-Storm Cat Northern Dancer line (that includes the sub lines of notable sires Sadler’s Wells, Danzig, and Vice Regent, among others) is about average, underperforming average finish but meeting expectations for wins (Charismatic and Big Brown) and top 3s. The Turn-To line includes modern sires Arch, Dynaformer, and More than Ready) has similarly average performance (Barbaro the one winner) but is slightly underlaid at the windows.

The “All Other” column shows that it pays to look for a unique Derby pedigree. 5 winners of the last 16 years do not fit in the major common ancestors though  Maria’s Mon (sire of winners Monarchos and Super Saver) does trace back to Mr. Prospector’s sire Raise a Native. 2011 winner Animal Kingdom traces back to Blushing Groom, who shows up in only 6 Derby-running pedigrees. Those 6 runners produced three top 3s and average finish of 6.5 however  – small sample bias, but definitely worth looking at.

Below are results for multiple modern sire lines and their corresponding stats.

Modern Sire Line

Runners

% Runners

% Pool

Pool / Rnrs

$2 ROI

Wins

Top 3

Exp Top 3

Avg Finish

A.P. Indy

35

11.9%

13.6%

1.14

-2.00

0

4

7

10.7

Bold Ruler

9

3.1%

2.6%

0.83

-2.00

0

0

1

11.4

Fappiano

30

10.2%

11.2%

1.09

2.20

2

8

5

8.4

Forty Niner

12

4.1%

3.0%

0.74

3.35

2

3

1

10.3

Gone West

9

3.1%

3.1%

1.02

-0.64

1

2

2

9.3

Other Mr P

44

15.0%

17.6%

1.17

-0.47

3

6

8

8.8

Storm Cat

32

10.9%

8.8%

0.81

-2.00

0

5

4

10.5

Danzig

12

4.1%

6.6%

1.62

-1.27

1

3

3

9.0

Deputy Minister

12

4.1%

2.7%

0.65

-2.00

0

1

1

11.1

Sadler’s Wells

8

2.7%

2.1%

0.78

-2.00

0

1

1

11.0

Other ND

13

4.4%

3.1%

0.70

3.12

1

1

1

10.8

Turn-To

22

7.5%

6.8%

0.90

-1.26

1

3

3

9.2

In Reality

10

3.4%

3.0%

0.87

-2.00

0

1

1

11.5

Blushing Groom

6

2.0%

2.1%

1.01

5.63

1

3

1

6.5

Caro

5

1.7%

2.3%

1.33

-2.00

0

1

1

11.4

Other

34

11.6%

11.3%

0.98

2.75

4

6

5

9.4

293.0

Years

16

48

9.2

Prominent sires with 3 y.o.s this Derby season, representing the current line:

AP Indy: himself, Pulpit, Mineshaft, Bernardini, Tapit, Sky Mesa, Malibu Moon, Majestic Warrior (many others)
Bold Ruler: Vindication, Slew City Slew, Leestown, Doneraile Court
Fappiano: Unbridled’s Song, Birdstone, Empire Maker, Even the Score, Broken Vow, Midnight Lute, Quiet American, Victory Gallop, Candy Ride
Forty Niner: Distorted Humor, Flower Alley, Sharp Humor, Any Given Saturday, Peace Rules, Trippi, Utopia
Gone West: Speightstown, Grand Slam, Elusive Quality, Smarty Jones, Proud Citizen, Mr Greeley, Istan
Other Mr Prospector: Smart Strike, Street Cry, Fusaichi Pegasus, Curlin, English Channel, Street Sense, Lemon Drop Kid, Henrythenavigator, Student Council (many others), E Dubai
Storm Cat: Giant’s Causeway, Tale of the Cat, Forestry, Harlan’s Holiday, Into Mischief, Johannesburg, Henny Hughes, Stormy Atlantic, Lion Heart (MANY others)
Danzig: Hard Spun, Big Brown, Magna Graduate, War Chant, War Front, Green Desert, Dylan Thomas
Deputy Minister: Awesome Again, Ghostzapper, Dehere, Wilko, Awesome of Course, Toccet, Touch Gold, Spring at Last, Silver Deputy, Badge of Silver
Sadler’s Wells: El Prado, Medaglia D’oro, Galileo, Perfect Soul, Kitten’s Joy, Horse Chestnut
Other Northern Dancer: Dixie Union, High Cotton, Hook and Ladder
Turn-To: Arch, More than Ready, Dynaformer, Sunriver, Rock Hard Ten, Hat Trick
In Reality: Tiznow, Tizwonderful, Officer, Successful Appeal
Blushing Groom: Leroidesanimaux, Yonaguska, War Pass, Zanjero, Kafwain, Congaree
Caro: Indian Charlie
Other: Holy Bull, Macho Uno, Monarchos, Giacomo, Pleasant Tap (numerous others)