The Tote operates on a system where all bets placed on a specific event are combined into a single pool. When the event concludes, the total amount in the pool is distributed among the winning bets based on the size of the bets placed and the total number of winning bets. This model differs from traditional fixed-odds betting, where odds are determined before the event and remain unchanged regardless of how many bets are placed. The Tote model is commonly used in horse racing, allowing for potentially larger payouts as the odds fluctuate based on the total betting activity.
Tote (Company) Example
For example, if a Tote company collects $100,000 in bets for a horse race, and two horses finish as winners, the payout will be calculated based on the total pool minus the Tote’s commission and the number of winning bets, distributing the winnings proportionately among those who backed the winning horses.