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The Hundred and Fifty Million Dollar Man

Alan Woods has used computer technology to become one of the world's most successful gamblers. but it isn't always a sure thing.
Michael Kaplan
From the Print Edition:
Gen. Tommy Franks, Nov/Dec 03

(continued from page 2)

As post-time looms, the biggest job centers around printing betting slips and making hundreds of wagers. The actual picking of horses, after all, gets entrusted to a computer system that is regularly updated with fresh information about horses, jockeys, track conditions and hundreds of specifications each week. "The only input that we do is based on the pool sizes," explains Woods. "But there are default values and the variation generally is not very much. Ten years ago Bill [Benter] said he could just switch the computer on and leave it during the race while he has a nap or drinks a beverage. But of course you'd be too scared to actually do that."

The system is so automated that Woods barely pays it any mind on this particular day and, for the first few races at least, he devotes most of his attention to his middle monitor. It is connected to a U.K.-based peer-to-peer wagering service called Betfair.com, which permits him to bet on today's races directly with other gamblers. "The turnover at Betfair is very small, which makes betting there a waste of time," Woods acknowledges, pointing out that it's patronized mostly by professionals and others with smart money, which turns the online wagering site into a more efficient (and tougher to beat) market than the racetrack. "But we do it with the hope that it'll eventually get bigger." Plus, it can be a good gauge as to where the sharp action is going. "Occasionally, we'll adjust what we're doing at the track based on what we see happening with Betfair."

You'd think that somebody who wagers the way Woods does would care deeply about horses and racing. He doesn't. For him it's purely a numbers game, and he brags that the last time he watched a race in person was some 18 years ago. Woods has had a couple misadventures with thoroughbred ownership, but he got into those situations only because friends presented them as sure deals. Not surprisingly, they never came to much.

As for today's races, Woods watches them on a jerry-rigged simulcast that appears, with severe time delays, on the screen of his laptop. Woods dispassionately checks out the races, occasionally eyeing his plus columns as they build during the first few contests. But even as he appears to be nearly $200,000 in the black, Woods shrugs it off: "This money is trivial. I could lose it all in a single race. The real excitement will come with the Triple Trio."

That Woods doesn't allow himself to get worked up by a couple hundred thousand dollars of profit is testament to the swings he's previously experienced. One afternoon in the mid-'90s, Woods did not have a single horse come in and he dropped $3 million, his worst showing ever. Then there's the single race day in 1995 on which he managed to win $8 million even though he was out of town, not monitoring the betting. The year before, he had also won $8 million with a successful run of soccer bets on the World Cup. When Woods mentions that he won "$5 or $6 million on the 1996 European Championship" and that he currently bets $100,000 per game on the National Football League (with the help of a handicapping colleague in the States), it's impossible not to wonder how he strategizes all of these wagers. Woods smiles tightly and replies, "Let's not talk about that."

A friend of Woods's once likened him to Howard Hughes. Though the reference was based on Woods's reclusiveness, it could have just as easily stemmed from his racing riches: $1.5 million, earned in a single session, is where Woods's idea of a good day begins.

He keeps himself holed up in an air-conditioned apartment where the view is sprawling, a pool table dominates the living room, and a downstairs TV spans 48 inches. "I don't leave this apartment during the day, except to go swimming in the rooftop pool, because it's too hot and humid. If I need something from the market, I get my maid or girlfriend to shop for me," says Woods, adding that he prefers to eat dinner in front of the television or computer and that his leisure time is fairly regimented. "I like going to the seedy girlie bars in Makati [an upscale neighborhood of Manila, where hookers are a main attraction for some Westerners]. I go out only a few nights per month, but on those nights, I tend to come home with two girls, or, usually, more."

Over the years Woods has earned enough money from racing that he was able to withstand a $100 million hit when he attempted to short the NASDAQ, a year too early. And while one of his more memorable stock investments involved shorting the Hang Seng Index in 1987—perfectly timed and bringing him a $1 million windfall in a single day when the stock market crashed—he has no problem in making distinctions between gambling and investing. "When you look at how much money I have consistently made from the horses, from 1987 onward, compared to what I've done in the market, horses would seem to be a far safer investment than stocks," says Woods, adding that he's not the only one who's benefited from his horse sense. "Outside investors [who put money into Woods's horse betting syndicate] normally get 100 percent returns on their money each year. The downside for them is that I can take it away whenever I want. There's no permanence."

Back at the races, a chunk of Woods's wagers is still above water as we head into the sixth event and the final leg of the Triple Trio with the 26 million up for grabs. But Woods and company are not going in with the sort of advantage that makes them comfortable. As he relates in an IM to his partners in Hong Kong: "We outlaid 13.8 percent of the TT [Triple Trio] pool and are alive for only 12 percent. If we miss, lose heaps." This is punctuated by the unspoken reality that for all of their computer technology and prep work and financial risk, the team is disappointingly underlaid as this next race gets set to go off.

For Team Woods to have a good chance at realizing its big payday, the No. 1 horse in the sixth race needs to finish in the running. But it is a favorite, so the team does have a chance, though Woods is quick to point out that it's less than 50 percent. He watches this race intently, but even judging by the choppy feed that comes in from Hong Kong, things seem less than ideal. Long before horses are shown crossing the finish line, Woods sighs deeply and says, "Oh, dear." He turns to me and adds, "I'm guessing we haven't got this." Then, right on cue, comes an e-mail from Hong Kong, punctuated with a frowning face: "No good."


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