Horse racing is a hugely popular sport worldwide, with millions of dollars wagered on races each year. Many fans see it as a great opportunity to invest in horse racing stocks, hoping for significant returns if they invest at the right time.
However, many people still prefer betting as their main way of investing in horse racing because it offers quicker returns on winning bets. But what are the different ways to invest in horse racing, and is it wise to invest in this sport today?
### Investing in Racetracks
One of the best investment opportunities for racing fans is investing in racetracks around the world. This is especially popular in the United States, where companies that own major racetracks are listed on the New York Stock Exchange.
A popular choice for investors is Churchill Downs. While it may not have the largest market cap, it has shown significant growth recently, with a 19% increase in the past few months and yearly highs. The value of Churchill Downs is still rising and has been stable, suggesting there is still time to invest before any potential drop. Experts predict up to 31% growth in the next 12 months, partly due to improvements like the newly reopened paddock at the 2024 Kentucky Derby.
### Investing in Trainers
Another way to invest in horse racing is by supporting trainers financially. This can involve funding better facilities and staff, which has led to long-term profits for many owners. A common method is buying horses and sending them to a specific trainer. This support can elevate a trainer’s career, as seen with renowned owners like J P McManus and his successful partnership with Jonjo O’Neill in the UK.
Some trainers offer investment opportunities without requiring horse ownership. Investors can earn returns based on the trainer’s winnings throughout the season. Wealthier supporters often prefer this method as it eliminates the need to manage horses while still sharing in the prize money. However, not all trainers accept this type of arrangement due to its complexities.
### Investing in Horses
The most popular form of investment in horse racing is buying racehorses and earning money based on their performance. There are various ways to invest in horses, with syndicates being one of the most accessible options. Syndicates allow multiple investors to own shares in a horse, but returns can be slim if many people are involved.
Investment opportunities typically range from 2.5% to 100% ownership shares. The higher the ownership percentage, the more you pay for training, vet bills, and entry fees, but you also receive a larger share of winnings and stud fees.
### Betting Investment
Betting on horse races is crucial for the sport’s success, as a portion of the bets goes back into the sport as prize money. Horse racing is one of the most popular betting options globally, offering excellent investment opportunities, especially around major events. Bettors can place bets up to a year in advance, often securing better odds. However, only experienced bettors are likely to see consistent returns on their bets.