The thoroughbred horse Spring Racing Carnival is in full swing in the state of Victoria, Australia, culminating in the running of the Melbourne Cup, “the race that stops a nation.”

Attendance at what is more akin to a “garden party” setting can well exceed 100,000 on Derby Day, Oaks Day and Melbourne Cup Day, and there are plenty of on-course bookmakers in the Betting Ring ready to offer odds to the eager punter.

Bookmakers, like insurance underwriters, make their profit from risk by estimating the probability of an event occurring.

This is reflected through the bookmaker’s odds and the rates charged by underwriters.

The traditional method of managing a balanced book has been as much an art as a science combining deep research, risk parameters, instinct and psychological management, which is gradually changing by taking advantage of emerging technologies.