I have been an active investor for many years. I buy stocks and bonds, subscribe to multiple stock newsletters and reports, and have various financial advisors giving me advice. I have invested in residential and commercial real estate and in limited partnerships. I consider myself a fairly savvy investor.
Recently, however, I invested in a thoroughbred racehorse. It has been a new experience to say the least.
I have been to a couple horse auctions as part of my education process, trying to understand value. All the thoroughbreds look magnificent, but none has a track record because they are too young to have raced, so data points are limited as a basis of decision-making. It is best left to expert trainers and their vets to make purchase decisions.
Many high quality 2 year old racehorses seem to sell for $250,000-$500,000 to experienced and well-known buyers. I watched Bob Baffort, who trained the recent Triple Crown Winner, buy a couple horses in this price range. This is more than I want to invest in my first horse.
Dan, a young but highly recommended trainer, recently bought a filly for about $37,000. This is more in my price range. I bought a 10.0% interest for $3,700. Now I am a racehorse owner. I am even registered with the California Horse Racing Commission and have an official membership card, which provides for access to horse tracks in California and a parking pass. I am feeling pretty good about my investment.
So how is my budding, bargain priced but possible future Derby winner doing? Cotton, which is her nickname, started out meeting expectations. First walking, then trotting and galloping, then racing around the track at Santa Anita gradually and slowly increasing distance. The training reports were good. Unfortunately, before too long, she hurt her leg.
When a young horse hurts her leg, she requires rest so as not to aggravate the injury. My horse was sent to a type of horse recreation center – maybe like a health spa for horses. She received lots attention including walks, massages, and rest time in a small enclosure while her leg improved.
After a few months at the equine spa, the filly returned to Santa Anita and gradually resumed a training routine. Then her feet began to ache. First she soaked her feet in cold water and ice. Then she was given special horseshoes – sort of like orthotics for horses. Between the ice and special shoes, she was able to resume training – after she recovered from her cold.
Following months of preparation and many bills, which are duly invoiced and paid each month, the filly was ready for her first official race. It was a race limited to horses that had never won a race; so the competition was not too challenging. We actually had hopes of winning the race.
It was a cloudy day in April at Santa Anita. Rain threatened but the track was dry. The excitement was building for the fifth race, when Cotton was running. It was a short race, only 5 ½ furlongs, and Cotton was fast. The trainer had hired an apprentice jockey, who was allowed to compete with a weight advantage, so our horse carried less weight for the short speed race. Bettors liked our horse, and she was a favorite even though she had never raced. Conditions looked good.
The filly was in the pre-race paddock area with her silks and saddle in place; she was nervous but her groom patted and comforted her. Suddenly, something bothered her and she reared up and fell over backward. She did a flip. I never heard of a horse falling over backward but apparently it happens now and then. Fortunately, Cotton did not incur any physical damage, but she was scratched from the race. We are unsure if she suffered any psychological damage because she does not talk about it.
The trainer is now looking to enter her into another race in the hope she will actually run the race. I remain ever confident that the filly will come through, although the fact she flipped over before her first race does cause me some concern and the cumulative monthly expenditures now exceed the original purchase price. But just in case she falters, I just bought into another racehorse. This one is from England and unfortunately prefers to run the wrong way around the track but otherwise looks good.