Jeff,
I salute you for your patient, diligent and methodical study of the materials! And I think you ask ALL the right questions: paceline selection strategy, Win percentage vs ROI, what to do about favourites. You appear to be pursuing the '
recommended' strategy of hiding favourites below a certain odds threshold, then betting (at least in the Win pool) 2 of the remaining Top 3 BL horses. Doc Sartin recommended this approach in later years. There are OTHER approaches though, and I think that personal psychology and comfort level with a Loss will play a big part of the overall approach an individual chooses - that is to say: higher Hit Rate / lower average mutuel and whatever ROI that produces versus betting against favourites / low Hit Rate, higher average mutuel and that ROI.
Let me restate - Doc would be the first person to advise you to conceive a method which left you
comfortable in your skin: heart not palpitating, not berating yourself for betting against a strong favourite or second guessing after 4 close call losses in a row to a horse you had in your Top 3 or 4. I know you have your own existing methods and are exploring the Sartin Method here. And I'm guessing you accept that working on paper IS NOT functionally the same as putting money on the line: the
EMOTION is not the same at all, and
EMOTION is at the core of the risk taking endeavour.
All that is background to my assertion that you have to discover an analysis / contender ranking / wager decision strategy that matches your psychological and emotional makeup. You don't HAVE TO eliminate top ranked favourites under 5/2 at post time and bet 2 of the remaining 3 BL. As an alternative, depending on your paceline selection prowess (validated by how often you get the winner in your top 3 or 4 BL), you could retain those low odds favourites (because there are a LOT of them) and calculate your Hit Rate and determine whether you can accommodate something like (probably at the worst case) EVEN odds plus 5/2 for 2 horses, resulting in either breakeven or .75 cents on the dollar. Again, a WORST case (and EVEN and 4-1 might be nicer, I agree). The point is, with a higher Hit Rate, say 65%+ betting 2 horses (together with some race selectivity) you'll need a lower average mutuel and can afford to relax some. Including some Place bets on higher Odds contenders (e.g. 5-1+) or replacing 2 horses with a Win/Place in some cases, will increase your Hit Rate and possibly comfort level.
This only matters if you NEED a higher comfort level when actually betting MONEY. If you are comfortable betting often enough from your 3rd Tier of BL, where the mutuels will on average be longer but the hits fewer, you may be quite happy with, and only require a 40% Hit Rate. The point is: your comfort level will not be the same as mine, or others. When you have amassed 200 races worked on paper, following your described method and noting your Hit Rate and resulting ROI AND frequency of Losses in a row (that can be terrifying) - consider then going back and reworking the same races NOT hiding the favourite (and thus betting against it), but instead including that favourite above a certain minimum Odds threshold (say EVEN to 7/5) plus your highest Odds Top 3 BL horse. Compare the numbers for both strategies. Does one method feel more comfortable than the other (albeit on paper and with no money or emotion on the line). Did you trade less ROI for greater comfort, thus potential more consistency and focus when things go LIVE? Was that trade worth it? Etc...
Lately, I have been doing a lot of precisely this last exercise and I must say that for myself, I feel happier hitting more races (and betting real money) and accepting (or passing where prudent) the flow of predictable chalk, while awaiting the good mutuels (including those $8.00 - $10.00 ones) still found in my Top 3 BL (or other Early or Late readouts depending on Match Up considerations).
Only YOU can know what approach works best for YOU, and that's why there are so many different readouts (different approaches, really) included in the Sartin software (too many different, and redundant readouts, though, IMO). The record keeping, the study, the attempt to remain consistent when developing a personal approach - all this is A LOT OF WORK! But I say you should expect to work hard, and expect to produce double digit ROI in the Win pool at least - ongoing - at pretty much EVERY track on the continent (better at some than others perhaps, and regardless of track takeout, BTW
)
I hope the above didn't sound like equivocating.
Follow the rules at first to understand the rules - then
break the rules if it serves you and you can prove that doing so consistently works better or feels better for you.
Good luck, good skill! Keep us posted.
Ted