# Sports Betting: Tote Systems And How They Work

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The word “Tote” is short for totalisator, which is a betting system that is ubiquitous around the world. Different countries offer varying degrees of the use of the tote system, but it is usually present in one form or another.

The tote in sports betting is essentially a pool betting system. The weight of money for a selection in a contest determines the returns for each runner. The majority of tote systems are used for events such as horse racing and for lotteries. And if you're looking to bet the ponies, check the best sports betting sites to see how many tracks each book covers.

Here is a look at the tote system and how it works.

## Tote System: The Breakdown

We can use the UK’s tote system used for horse racing as an example. The current deductions from the tote are 16.5%, and we will use a six-runner race with a pool of 40,000 euros to demonstrate the calculations that produce the dividend. The following figures next to each horse represent the amount that has been staked on each horse in euro form:

Horse A – 8,000
Horse B – 12,000
Horse C – 2,000
Horse D – 6,000
Horse E – 1,000
Horse F – 11,000

If we assume that Horse D will win the race, the payout would look like this in euro form:

40,000 – 16.5%
40,000 – 6,600 = 33,400
33,400/amount staked on Horse D
33,400/6,000 = Dividend

So for every euro that has been staked on Horse D, the total payout will be 5.57.

There are advantages and disadvantages to the tote system. One of the major advantages is that the customers can generally stake what they want on a race as they are effectively betting against other punters. Fixed odds bookmakers are not obliged to accept business from large staking clients. Another advantage is that having a pari-mutual style system in theory reduces the ability for skullduggery and increases the integrity of the racing.

With the tote, if large amounts of money are staked then the dividend is reduced and it will act as somewhat of a deterrent for those looking to fix the event. One of the major disadvantages for the pari-mutual system is that punters are not able to determine their exact return when placing the bet. This is a bigger issue for those that treat their gambling as more than simply a recreational activity. Another problem is that if the market is weak, then the odds can be skewed by one large bet.

For example, if the total pool is only \$10,000 and a large staking punter put another \$10,000 on a specific horse to win then the entire outlook of the pool would shift dramatically and the odds would look very different.

## Outlook

The free market potential and its ability to reduce the potential for manipulation has made the tote a popular option for sports betting racing corporations like Intertops. While some bettors don’t want to place a bet without knowing the potential earnings of it, the reality is that sacrifice is more than worth it on order to make sure the actual race isn’t corrupted. The tote system is extremely popular both in government and in horse racing and now you know why it works on both levels.

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