"We believe the real opportunity to ‘hit the long ball’ is to own a prospective stallion, and with significantly fewer horses coming on the market to buy, it is increasingly important to try to ‘make’ these stallion prospects."

Three years ago we decided to focus our attention on opportunities presented through pinhooking weanlings to yearlings and yearlings to two year olds. In developing this program, we were also satisfying an increasing demand from our clients and friends to participate in the Thoroughbred business. In order to accomplish this, we offered 30 units at a cost of $50,000 per unit. These were absorbed fairly quickly, and we invested in 6 units ourselves. Our opinion is, the real potential for a significant return, is if you are fortunate enough to own a promising horse on the track. With this project, one has the opportunity to evaluate their horses and if they are not selling for what you consider fair value, protect them and race them. Ideally, you generate enough cash with those you sell to retain a few and race.

The first two years varied considerably in their results with the initial one virtually breaking even. The second provided nearly 100% return and produced the very promising three year old, Exhale.

In 2006, we bought four entire yearlings that we sent to Niall Brennan and half of two others that we sent to Con Marnane in Ireland. Two of these were by Dynaformer, (1) Maria’s Mon, (1) Yes its True, (1) Lemon Drop Kid, and (1) Forest Wildcat.  In total we paid nearly $925,000 for these yearlings and sold the two halves in Ireland and two of the four with Niall. The four we sold were for a profit but not enough to offset the expenses and cost accumulated from the two we retained to race. We accept this position, for in our evaluation, the two we retained demonstrated considerable talent yet developed issues which prevented them from selling for what we assessed as market value. This is part of the gamble, and we think it is vital that you have the flexibility to make these assessments. It won’t work every time, but it did for us in 2005 when Palace Episode, who was not sold as a two year old in training, went on to win a Group 1, and provided the thrill of a lifetime and eventually sold for a significant profit.

We still have a chance to pull out a profit with our 2006 program since we have five yearlings to sell by varied stallions: (2) Harlan’s Holiday, (1) Mineshaft, (1) Smoke Glacken, and (1) Yes its True. We paid nearly $330,000 for these and are pleased with how well they have done.

The market this year has grown more selective as demonstrated with the two year old in training sales. This selectivity has been evolving for the last few years and is not a surprise. Even with the market being selective, if you have an athlete that checks all the boxes, you have a good chance for a decent return. Like any business, a select market separates the professional from the novice and our record has demonstrated that we have a better chance than most to hit the long ball and have some fun.