It was raining harder than it had all day and it was cold enough that hoards of people were huddled anywhere they could find cover. Yet more than a few people were outside, waiting in lines, soaked, and shivering. That is because wagers were more valuable than comfort at the Kentucky Derby. The right bet can bring warmth and joy that far exceeds a few hours of braving inclement weather in a seer sucker and fedora. On the other hand, the wrong bet can bring misery far worse than some cold damp clothes.
I have been attending horse races for over a dozen years. I am not an expert, I do not place extravagant bets, I am just a person who enjoys going to the track with my friends. Saturday I was standing in line at Churchill Downs completely drenched under my rain poncho. If there is one thing I have learned in all these years going to races, it is that imperfect conditions can wreak havoc on a race.
Roughly one hour later there was pandemonium as the winner (and favorite) was disqualified. As the crowd around me erupted, I was cashing in a ticket on a longshot. Since the lines were barely moving, I had plenty of time to think about the historic moment that was taking place.
- It was one of the worst rains the Derby had experienced in 145 years of existence.
- For the first time ever, the horse that crossed the finish line first would not be declared the winner.
- The second to biggest longshot in Derby history was declared the winner.
Again, I am no expert, but that afternoon I placed three $2 bets on longshots. If there is nothing else our industry teaches us it is that life throws curveballs. At the track it could be conditions, an immature horse, a mistake by the jockey, etc. Life’s curveballs can be a volatile market, a torn ACL, early onset Alzheimer’s, etc. Curveballs in life and at the track can take us for wild rides in any given direction or have little impact at all.
Your financial plan may be the 4-1 favorite; however, you must always consider a plan to factor in the unforeseen conditions that could lead to a 65-1 upset. If not, then I saw first hand on Saturday what happens when a “winning” ticket is disqualified from the race, and it is not pretty.