With the yearling sale season now in full swing, the age-old question on when best to buy a racehorse is raised again.
At OTI, we make no excuses for our long-held policy of trying to buy ‘going’ horses. By ‘going’ horses, who have showed some ability in a race, jump out or breeze up. Given the high-risk nature of buying racehorse shares, we simply believe that each step you take to eliminate that risk gives you a better chance of having success on the track, providing, of course, you do not have to pay an unacceptable premium to do so.
Although essential to our breeders, yearling sales are arguably the riskiest market in which to buy a horse. It will cost a yearling buyer at least $50,000 on top on the purchase price to see if the horse is capable of being competitive. The buyer can also be assured that if a premium has been paid for a colt, there’s a better than even money chance that the horse will be a gelding within 12 months, thus reducing the horses value to what it can win.
In recent years, the growth of breeze up sales, especially Karaka, the acceptance of jumpouts as a source of buying stock, and the ever-increasing acquisition of European horse, now provide racehorse owners with an array of purchasing opportunities. Lately, the success of the online auctions has added a further (and popular) means of facilitating horse racing ownership.
Our thoroughbred sales companies do a great job for the breeders in our industry and proudly quote statistics surrounding the prices paid for their horses. It’s not surprising, however, that so few statistics on the racetrack success of their sales are quoted. Quite simply, when it comes to higher priced yearlings, the statistics would not be all that flattering.
As we well know by now, there’s a lot more to buying at a yearling sale than attempting to justify the horse’s purchase price. The buzz, euphoria, expectations – call it what you will – creates great theatre for players and spectators alike, but that’s little to do with economics. As the great late trainer Colin Hayes once said, “the best businessmen in the country leave their brains at the door of a yearling sale.” How true, but clearly they take their hearts into the ring, otherwise yearling sales would not be what they are.
Last Saturday, some fortunate OTI owners had the thrill of winning the $1m Listed Magic Millions Fillies & Mares with Lady Laguna. Unpresented at any yearling sale, she was purchased out of the paddock at Spendthrift Farm as a yearling for a very modest price. Having now earned over $1.3 million for her owners and now being a valuable broodmare prospect, she helps confirm the adage that good horses can come from anywhere.
For those considering horse syndication or racehorse shares, exploring varied acquisition avenues such as breeze ups and tried horses might prove prudent in enhancing your horse racing ownership experience.