The truth of the matter is that not all foals born make it to the racetrack. In a random study, an average of 70% of foals made it to the track and approximately two thirds of those actually won. Half of the starters were repeat winners. In the order of 3.5% of foals born were stakes winners and somewhat over 5% were stakes placed. We think it would be fair to say:
“Racehorse ownership is not for the faint-hearted.”
STILL INTERESTED?
We suspect that if you are reading this passage you may have what it takes to become a racehorse owner. Ownership comes with more than just an investment aspect.
OWNERSHIP; * Will provide excitement – winning is euphoric, ownership gives you an adrenalin rush when your horse thunders down the track!
* Offers you the opportunity to share not only in a joke or a story or two, but also in industry parlance with the camaraderie of industry figures and like minded people – other partners.
* Supplies you with the opportunity to network.
But above all, 'Life Is Too Short' and you should treat yourself to this truly amazing experience.
HOW DOES IT ALL WORK?
The most common method of ownership is to purchase a share in a racehorse. A share is an actual percentage of the racehorse. The percentage rate of the share is determined by the promoter and one of the most popular methods is to divide the full ownership into ten shares of equal value (i.e., 10% each share) but ownership may be divided into as many as twenty shares whereby each share represents 5% of the actual horse.
"Select Thoroughbreds chooses primarily to offer partnerships of ten shares of equal value in all promoted racehorses however to make ownership a lot more affordable in 2008, Select Thoroughbreds has structured ownership to allow for one per cent stake holders!"
In 2008 Select Thoroughbreds will offer shares as small as 1% with the view to accumulate enough interest to capture, at minimum, a 10% share in any of the yearlings on offer. Select Thoroughbreds will then register the Syndicate with Racing Victoria Limited (R.V.L.) and manage the Syndicate on behalf of all its members.
MAY MORE THAN ONE PERSON OWN A SHARE?
One or more Select Thoroughbreds’ shares may be purchased and owned outright by an individual. It is also possible for one or more Select Thoroughbreds’ shares to be owned by two or as many as twenty people so long as they register their common interest as a Syndicate with Racing Victoria Limited.
Syndicates are often formed by groups of friends, neighbours or work colleagues. Forming a Syndicate with a group of friends or work colleagues makes the experience enjoyable and offers the opportunity to own a share in a horse. To find out more on 'How to Form A Syndicate'click here. Thus the total ownership of a Select Thoroughbreds’ promoted racehorse can be made up of individuals owning their own share/s or a combination of individuals and Syndicates.
Owning a share of a Select Thoroughbreds' racehorse as a member of your own Syndicate means you divide the costs amongst the number of members in your Syndicate. The more members in the Syndicate the less cost for the individual member and needless to say it is one of the most affordable ways to racehorse ownership.
Owning a share in two or more racehorses as a member of a Syndicate as opposed to owning two or more shares of the same horse offers you diversity and greater flexibility as an owner.
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HOW MUCH WILL THE EXPERIENCE OF OWNERSHIP COST ME?
The purchase price that you pay for a share will vary from yearling to yearling but will represent your share of:
·The cost of the yearling;
·Holding costs, including breaking in,agistment and transporting the horse to and from venues, until the yearling turns two years of age (1st August);
·Usually nomination fees for the Blue Diamond and Golden Slipper races are included and also nomination fees to either the Inglis race or Magic Millions race series;
·Insurance, veterinary examinations, valuations, registration fees and costs;
·Auditing and accounting costs, printing, phone calls, travel, postage and stationery sundries;
·Advertising and photographic fees and the licensed promoter's administrative fee.
Other than the initial share price, once all shares are sold and the racehorse is registered, you will need to meet the monthly training and maintenance fees for your share and will be invoiced directly by the trainer. Over the period of one year the training and maintenance fees currently average to about $230.00 per month. Obviously the fees do not include any unforeseen incidents such as surgery due to injury and interstate or overseas transport, insurance and entry fees into major races (Group, Listed and Stakes).
Partnership (whole of horse/scheme) Managing Fees
Select Thoroughbreds manages a number of partnerships and over the past several years has been able to do so at no cost to the shareholders. Unfortunately, as much as we’d love to continue this tradition, the increasing costs allocated to telephone usage, travel, postage, stationery, the amount of time and effort allocated to organisation etc., prevent us. These costs which, up until 2007, have been absorbed by Select Thoroughbreds have forced us to introduce a $200.00 per annum manager's fee to each owner and registered syndicate.
Syndicate Managing Fees
Additional Fees:
If a horse is part owned by a registered Syndicate whereby the Syndicate is managed by Select Thoroughbreds, then each member of that Syndicate will be charged a $100.00 per annum manager's fee for costs associated with managing the Syndicate, irrespective of the share percentage held by that member.
OWN A SHARE IN A RACEHORSE BY FORMING A SYNDICATE
A share in a racehorse may be owned by (a) a natural person; or (b) a Syndicate provided that in the case of a Syndicate, it has been registered in accordance with the Rules of Racing and complies with the Regulations.
A Syndicate must be given a name and can be one of the following:
(a) A company (defined in Australian Rule of Racing 1);
(b) A combination of persons not exceeding twenty;
(c) A firm (defined in Australian Rule of Racing 1);
(d) A stud (defined in Australian Rule of Racing 1) which has been registered as a syndicate in the name of the stud.
REGISTRATION INFORMATION
It costs $275.00 to register a Syndicate with Racing Victoria Limited with an annual renewal fee of $55.00. Forms are available through:
It is the responsibility of one of the syndicate members to manage the syndicate. His/her role includes the setting up of a bank account (preferably two signatories). This will enable each member to be able to deposit their monthly installment (as calculated below).
The manager will receive invoices from the trainer and is responsible for settling the account. He/she is also responsible for the dispersal of the winnings through distribution cheques to each of the syndicate members.
All the above Information is available on the Racing Victoria Web site and can be easily accessed at: Racing Victoria Owners Page
EXPENSES
The table below shows the ongoing expenses incurred by each member of a Syndicate (2 to 20 persons) which owns one 10% share. The monthly racing and horse maintenance expense is based on a $230.00 fee per 10% share.
How many people are in your Syndicate?
One off fee Syndicateregistration fee $275.00
Annual fee Renewal of Syndicate Fee
$55.00
Monthly Fee Racing and horse maintenance expenses -
$230.00 per 10% share
Or Alternatively Weekly Fee Racing and horse maintenance expenses -
$230.00 per 10% share
2
person Syndicate
$ 137.50
$ 27.50
$ 115.00
$ 26.47
3
person Syndicate
$ 91.67
$ 18.33
$ 76.66
$ 17.64
4
person Syndicate
$ 68.75
$ 13.75
$ 57.50
$ 13.23
5
person Syndicate
$ 55.00
$ 11.00
$ 46.00
$ 10.59
6
person Syndicate
$ 45.83
$ 9.17
$ 38.33
$ 8.82
7
person Syndicate
$ 39.29
$ 7.86
$ 32.86
$ 7.56
8
person Syndicate
$ 34.38
$ 6.88
$ 28.75
$ 6.62
9
person Syndicate
$ 30.56
$ 6.11
$ 25.55
$ 5.88
10
person Syndicate
$ 27.50
$ 5.50
$ 23.00
$ 5.29
11
person Syndicate
$ 25.00
$ 5.00
$ 20.00
$ 4.81
12
person Syndicate
$ 22.92
$ 4.58
$ 19.17
$ 4.41
13
person Syndicate
$ 21.15
$ 4.23
$ 17.69
$ 4.07
14
person Syndicate
$ 19.64
$ 3.93
$ 16.42
3.78
15
person Syndicate
$ 18.33
$ 3.67
$ 15.33
$ 3.52
16
person Syndicate
$ 17.19
$ 3.44
$ 14.38
$ 3.31
17
person Syndicate
$ 16.18
$ 3.24
$ 13.52
$ 3.11
18
person Syndicate
$ 15.28
$ 3.06
$ 12.78
2.94
19
person Syndicate
$ 14.47
$ 2.89
$ 12.11
$ 2.79
20
person Syndicate
$ 13.75
$ 2.75
$ 11.50
$ 2.65
Page 3
WHEN WILL MY HORSE RACE?
All horses share their birthdays on the first of August of each year. Shares are usually offered when thoroughbreds are of a yearling age (1 year old). Yearlings are not permitted to race. Also, the Australian Rules of Racing prohibit two year olds from racing before the first of October. Still after this date, most two year olds require more time to mature and develop and may undergo and need to endure several training preparations before competing. A good number may even commence racing as three year olds. Factors such as their physical composition and well being during preparation and training will dictate how early they race. The trainer will determine when the horse is physically and mentally strong to handle his debut.
WHO WILL MANAGE THE HORSE AND WHAT RESPONSIBILITIES ARE ASSOCIATED WITH THIS ROLE?
Select Thoroughbreds will manage the scheme (horse).
THE MANAGER’S ROLE
The Manager’s role includes but is not limited to:
**Communicating with the trainer on a regular basis and reporting this information back to the owners;
**Representing the owners on the racetrack;
**Opening and maintaining a bank account for the deposit of all prize money by the various clubs;
**Distributing prize money to all other owners;
**Providing information and arranging, if need be, of copies of winning videos, dvds, winning frames, photographs and ticketing for race day attendance;
**Arranging the sale of shares or sale or disposal of the horse;
WHO DECIDES WHERE AND WHEN THE HORSE WILL RACE?
Traditionally, the trainer decides on the most suitable race and the allocation of a jockey for the horse although this does not preclude the owners from suggesting otherwise. They should make such suggestions through the manager but usually these types of decisions are best left with the trainer.....he knows your horse best. Due to the nature of the breed, racehorses will commence racing at different stages during their life, over varying distances and in differing conditions.
Some horses will be late maturing physically and/or mentally and may not make it to the track as a 2 year old. The thoroughbreds' bones are modelled and re modelled as they go through their training regimes. Too much, too early may not only break their will but also may cause small microscopic fractures. These may go on to form stress fractures and if they are not diagnosed or detected the results can be catastrophic. On the other hand, others have the genetic composition in their breed to race early. In some cases you may not discover your horse's ideal distance until they have had several starts but until then, methods such as 'Dosage' may offer some form of guide about the distance the horse may cover.
Generally speaking, the trainer will be assessing the horse's ability in conjunction with the endurance and strength required and location of race meetings that are available. He will then place the horse in a race to give it the best chance of winning or running a place.
AS AN OWNER MAY I SPEAK TO THE TRAINER?
Generally speaking, the trainer or his racing manager will deal with owners through the horse’s appointed manager. It is one of the primary roles of the manager to act on behalf of, and as a voice for the owners. As you can appreciate, larger stable sizes mean extensive day to day operations and can be extremely busy. In any event owners will have ample opportunity to speak to the trainer and his/her staff throughout a horse's racing career.
Page4
WHO WILL NORMALLY RIDE THE HORSE, WHEN IT IS RACING?
Trainers will use different jockeys for varying reasons including but not limited to, overall racing experience, experience with a particular racehorse, claiming weight and the unavailability of others to take the ride. The decision on which jockey should take the ride should be left with the trainer who will be in a better position than you or I to know the circumstances surrounding the horse and the avaiability of jockeys.
WHAT PRIVILEGES DO I GET AS AN OWNER?
Racing Victoria in conjunction with the Thoroughbred Race Horse Owners Association (TROA), developed an initiative known as the ‘Owners Gold Card’. Any person who has raced a Thoroughbred Race Horse in Victoria since August 1 2004 is entitled to an 'Owners Gold Card'. Fees do not apply in obtaining the Owner's Gold Card.
During ordinary race meetings whilst your horse is running, the ‘Owners Gold Card’ entitles the named owner, plus 1 guest to ;
·Free entry to the course where the horse is running
·Access to a nominated Owners’ and Trainers’ Bar.
·A free race book and complimentary beverage in the Owners Bar.
·Entitlement to Grand Stand seating for the duration of the race in which your horse is engaged.
·Access to the Members area of the race course.
The owner has access into the mounting yard for the duration of the race in which the horse is running and is entitled to use the ‘owners only’ parking area, at the race track.
When your horse is running at a Feature race meeting, privileges are limited strictly to owners.Owners are entitled to the same privileges as above, but unfortunately there will be no provision for you to bring a guest.
Holders of an Owners’ Gold Card will receive racecourse admission to over 300 Victorian race-meetings, even when their horse is not racing, however free attendance to certain feature race meetings are excluded.
There are also a number of other benefits such as free entry to the Australian Racing Museum at Federation Square, discounts on merchandise at this location. A comprehensive list of owners’ privileges is available from the Racing Victoria website: Click Here
WHEN MAY I GET AN OWNERS CARD?
Owners of an un raced horse are able to apply for their Owners Gold Card, any time after the horse is nominated for it’s first start. If you apply and don’t receive your Gold Card in time for the race, Temporary Cards are currently being issued by Racing Victoria Staff, at the race courses around Victoria.
Page 5
WHAT IS PRIZE MONEY LIKE IN AUSTRALIAN RACING AT THE MOMENT?
The prize money pool for most of the standard metropolitan races in Melbourne on a Saturday or a public holiday is between $50,000.00 and $70,000.00 depending on the venue holding the event. The prize money pool for most of the standard metropolitan races in Melbourne during the week or on Sunday will vary between $24,000.00 and $55,000.00. The prize money pool for most of the standard country races in Victoria is between $8,000.00 and $20,000.00. Group one (1), two (2) and three (3) races and any listed or stakes race, known as ‘black type’ races are the most prestigious races and prize money pools vary between $100,000.00 and $500,000.00 although there are several other races that exceed this amount.
Prize money pools are apportioned in the following way:
· For races with prize money pools of $40,000.00 or more: 1st - 65%; 2nd - 20%; 3rd - 9%; 4th - 4%; 5th - 2%
· For races with prize money pools of under $40,000.00: 1st - 65%; 2nd - 20%; 3rd - 10%; 4th - 5%.
· Prize money for Group and Listed races or other races specified by Racing Victoria: 1st - 60%; 2nd - 18%; 3rd - 9%; 4th - 4.5%; 5th - 2.5%; 6th - 2%; 7th -2%; 8th - 2%
If a horse wins prize money, 85% is allocated to the owner/s, 10%to the trainer and 5% to the jockey.
Non prize money earners receive a starter's subsidy of $150.00. Victoria offers the most prize money of any state.
ARE THERE ANY INCENTIVE SCHEME’S OPERATING?
The Victorian Owners and Breeders Incentive Scheme (V.O.B.I.S.) is designed to reward owners and breeders who invest their money into Victoria’s racing and breeding industry through big cash bonuses. In the main, bonuses can vary from $7,000 at a TAB Country event, $30,000.00 during an event where prize money is $40,000.00 or greater (generally Saturday and public holidays) and $10,000.00 where the race prize money is between $22,000 and not more than $39,999 (generally midweek, Sunday and night metropolitan events).
Super V.O.B.I.S. bonuses are on all two and three year old events conducted throughout Victoria and are paid out to first, second and third place-getters. In order for a horse to participate in Super V.O.B.I.S. it must first be nominated to the Scheme as a yearling.
Other states have their own incentive schemes. As long as horses comply with the eligibility criteria and are nominated into the Scheme (usually by the breeder) then regardless of where the horses are stabled, provided they qualify in the race they will receive the bonus.
N.S.W. has the Breeder Owner Bonus Scheme (B.O.B.S.) whereby winners may receive a bonus of up to $16,000.00 cash or up to $32,000.00 credit against purchases of any BOBS eligible yearlings sold at public auctions conducted by participating Sales Companies.
South Australia has the South Australian Breeders’ Incentive Scheme (S.A.B.I.S.) and bonuses of $15,000 are paid to 2 and 3 year olds.
Queensland has the Queensland Thoroughbred Investment Scheme (Q.T.I.S.).
Remember these are just bonuses not prize money. Yearlings which have subscribed to an incentive scheme will be advertised accordingly.
Other incentives can include participation in races sponsored by the Auctioneer who sold the yearling. For example, William Inglis & Son Limited (auctioneers) promote their Classic and Premier races worth $500,000.00. Magic Millions Sales Pty. Ltd. has a similar incentive, known as ‘The Magic Millions Race Series’. Some of these races contain prize pools of up to $1,000,000.00. Nomination fees, conditions of ballot and acceptance fees apply.
DO I NEED TO INSURE MY HORSE?
Generally, insurance covers for mortality and theft only. If your horse sustains an injury which precludes it from racing then insurance will not cover this risk.
Insurance is definitely an individual choice and one needs to make the decision based on one's own personal circumstances and assessment of the situation. For some, it may be as simple as answering this question: 'If your share was not insured and the risk was to occur would the financial impact (loss) necessarily concern you?' If it wouldn't then you may not want to insure however, if it would then insurance may be a prudent choice.
Due to the fickle nature of the racing industry and the number of variable factors which need to be considered, 'Select Thoroughbreds' strongly recommends that clients insure their share of the horse, particularly until it starts its racing career. Afterwards one may re evaluate whether to stop insurance altogether or alternatively to increase/decrease the value of insurance.
Page 6
DOES EVERYONE HAVE TO INSURE THEIR SHARE?
No, you can insure your 10% share individually. It may be a case that only 4 owners out of 10 choose to insure their share.
Insurance varies from company to company but can be calculated at around $45.00 per $1000.00 and in most cases 10% G.S.T. and stamp duty (stamp duty varies from state to state and in Victoria it is around 10%).
Therefore taking the values above, a $5,000.00 share (inc. G.S.T.) may cost approximately $272.25 to insure based on the following:
$225.00 premium (5 x $45), plus $22.50 (10% G.S.T.), plus 10% stamp duty on $247.50 is $24.75.
WHAT HAPPENS TO THE HORSE AFTER IT FINISHES RACING?
A gelding is a colt which has been castrated. Generally the reason colts (2 and 3 year olds) are castrated is either to improve the temperament and attitude of the horse or to reduce the heaviness and consequent pressure on the forelegs. Gelding a horse is said to prolong its racing career. A gelding has a limited future after racing and may be sold for equestrian pursuits after its racing career or may be purchased by any interested party.
Mares (female horses) may be used for breeding after stud. It is certainly possible, after some careful consideration, choosing the right stallion for her may produce a foal you wish to race. Alternatively you may offer the mare and/or foal up for sale at the various auctions throughout the country. The mare may also be sold at an auction or advertised for sale via the media or through a bloodstock agent.
Entires are male horses which have not been castrated. Entires that win several ‘black type’ (prestigious) races may stand at stud with hefty service fees. Some of these stallions can serve 100 mares per season and can serve for many, many seasons. Service fees may vary from year to year depending on how the stallion’s progeny are performing on the track. Those that don't quite make the grade have the same fate as geldings after their racing career.
What happens to your horse after it finishes racing is generally decided by the owners during a meeting convened by the manager.
WHO NAMES THE HORSE?
The horse’s name is normally selected by the owners. The owners will be called upon and asked firstly to supply a name for the horse and then to vote in order of preference. This occurs prior to the registration papers being submitted to the Registrar. The votes are tallied and the names are submitted in order of scores. The final approval for the name is left with the Registrar of Racehorses.
WILL I EVER GET TO SEE THE HORSE?
When the horse is agisting you can call the farm and arrange a time to see the horse and likewise when the horse is in work you can contact the trainer or his/her racing manager and arrange to see the horse. Trainers normally invite owners to attend jump outs (unofficial trials) or if the horse is engaged in an official barrier trial then these are open to the public.
