Dutching can be a great way of minimising your risk whilst still looking at a healthy profit. Peter Webb shows us how.

Long before exchanges came on the scene it was well known that there was another way to make money from horses that were likely to lose. Rather than laying a specific horse that you thought was not going to win, you would simply back the remainder of field excluding the horse you wanted to oppose. The nickname for this process is “Dutching”.

Dutching was, allegedly, created during the Prohibition Era by Al Capone's accountant, "Dutchy" Schultz.  The essence of the system was that he backed multiple horses to win in the same race.  The amount he bet on each horse was calculated so that the same amount of profit was achieved if any of his horses won the race.

You can summarise the popular strategy of dutching by thinking of bookmaking and turning it on its head. Dutching is the process of backing under round rather than laying over round. But rather than taking a risk free bet when the book is under round; when you perform dutching, you are backing a number of selections, excluding certain outcomes, to hit a profit target. Dutching is typically used on horse racing to create profitable bets by excluding horses from a field of runners. Essentially this is a skill strategy and requires an element of judgement on the punters behalf.

Dutching techniques are often used to find two, or more, selections in a race or sporting event. Depending on the price and quality of the leaders in the field you could just dutch the top runners or maybe larger parts of the field. Dutching is useful if you want to oppose one or more horses but you are uncertain of the potential winner. There are several other scenarios in which you could put it to use.

Imagine you have two horses you like in the next race and you are pretty sure that one of them will win. You could make a nice profit if you dutched them both. However, you are uncertain about the ability of a couple others in the race and by using dutching you could cover those as well.  Perhaps you have found a tempting long shot. The weather has been poor for most of the day and the leaders in the field are beginning to drift. You could easily dutch the outsiders along with the market leaders to cover most possibilities. Dutching is a good way to add some insurance to your backing exploits.

When you have found your selections you have a variety of options of how to put dutching to use. When dutching you can just use a level stake or you can specify a profit target. The advantage of using a level stake is that you can easily monitor your progress, but the downside is that your profit will vary from race to race depending on the strength of the field and the amount of selections you cover. With a profit target, you can easily define how much you want to make from a days racing. But your bank size will have to have a lot of flexibility.