One of our owners approached me recently and said “I want to buy a really good horse at the sales. What does it cost to buy the best horses”?  The quick answer is simply, the best horses are rarely the most expensive horses. History shows that most of the grades I stakes winners and champions (Seattle Slew, Zenyatta, I’ll Have Another, etc.) are purchased for between $25,000 - $150,000, while very few of the top priced horses at any public auction end up to be major stakes winners and virtually none ever earn back their purchase price. This has held true for decades at all sales; regardless of venue or type of horse (weanling, yearling, two year olds), the worst way to invest money is to purchase the top priced horses. As an example, here’s the results of the top ten horses by price from the OBS March 2016 two year old sale. This is the premier two year old sale held in North America, a number of top horses come out of this sale every year. We picked 2016 because these horses are four year olds of 2018; while there can always be the rare late developer, by now they’ve had enough time to give a very good idea of what kind of racehorses they are. Take a look at the table below…

Name                     Hip # from sale     Purchase Price      Earnings                Race Record         Comments

Collectively the top ten horses from OBS 2016 cost $8,260,000 and earned $755,624, or about 9% of their purchase price. This does NOT including training expenses, which average about $50,000 a year per horse for about 2 years of training, so if you add in training costs there’s about $1,000,000 more in expenses. Three of these ten horses are still maidens, two have won a single maiden race. Two horses did win stakes but none won so much as a single graded stake, let alone a grade one race. The top two horses by price had the worst results. Formula One, purchased for $1,700,000, is unplaced in two lifetime starts with career earnings of $712. Monaco, purchased for $1,300,000, ran his career earnings to $57,977 by winning his 2^nd career start, a $25,000 claiming race at Parx on 2/13/18. 

Why do people pay these outrageous prices for horses at sales? Quite simply, these are billionaires who don’t care about losing millions of dollars on their hobby. Most of these horses are beautifully bred, have excellent conformation, and had super-fast work times at the sale. While they’d have a far better chance of coming up with a top racehorse buying ten horses for $100,000 each, the massive egos of these owners won’t let them buy anything but the best-bred horses that work the fastest at the sale. In truth they are buying collector’s items, pedigree pages to hang on their wall, not racehorses. These people are advised at the sales by the best experts’ money can buy, the horses are trained by hall of fame trainers. The cold truth is, top pedigree and fast work times with an unraced yearling or two-year-old offers little assurance of racetrack success, anymore than the 12 year old son of a famous basketball player is likely to end up as an NBA star.  This is actually a very fortunate thing for the rest of us; if it were as simple as paying the most money for the best-bred horse with the fastest breeze times, the richest people would have all the good horses and nobody else would be able to compete.

What does this tell business-savvy people looking to find good racehorses without breaking the bank? First, it’s a numbers game. You are far, far better off buying ten nice horses for $50,000 - $100,000 than putting all your eggs in one basket by paying $1,000,000 for the top priced horse at the sale. Second, most horses end up unraced, lifetime maidens, or lower level claiming horses. About 3% of all horses win a stake race in their lifetime, less than 1% win a graded stake, and about 20-30 horses out of a foal crop of about 23,000 each year win a grade one stake. That means that even if you have a great team and do your homework at the sale and spread your risk by purchasing 10 nice horses in the above mentioned $50,000 - $100,000 +/- value range, the results aren’t going to look all that different than the top ten horses from the OBS March 2014 sale detailed above. Most will never win more than a maiden race, and you’ll be lucky to come up with one or two nice horses from the group. The difference is, if you spread your risk, don’t overspend at the sale, and give the horses to hands-on trainers who don’t charge outrageous training bills, your bottom line will look a whole lot better than getting back 9% of your purchase price in purses, as the buyers of the 10 highest priced horses at OBS did. That’s not to say it’s easy to make money, in this game coming out with an occasional nice horse without breaking the bank is a genuine success story. It’s a fantastic game, fun and excitement like nothing else. With a good plan, patience, and a skilled team behind you it IS possible to end up in the black when you come up with a really good horse, but as the old racetrack saying goes, this isn’t a game for little boys (or girls!) in short pants.