Little Red Feather Racing Blog

Horse Racing Partnerships 101: We Miss You Barry Abrams

Posted by Gary Fenton on Mar 25, 2017 1:19:10 PM

Trainer Barry Abrams retired last year and California racing is not the same. He co-owned the great California stallion Unusual Heat (a horse he claimed) and had a style of training not seen in decades (and still not emulated).  He was also a mentor to a young syndicate named Little Red Feather.

My favorite Barry Abrams story is this.  
 
He sold us and our partners 80% of a CA Bred horse named Unusual Beam and almost immediately the horse got hurt and needed 8 months off. As you can imagine this wasn’t an ideal start to the new partnership. So, Barry came to me and said, I have another horse!  As my eyes rolled, he explained the other horse, the CA Bred Lindz Winz, was just coming back from a similar injury and the same partners should “trade” 25% of Unusual Beam for 25% of Lindz Winz. 
 
TRADE!?  Is this Major League Baseball? 
 
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Topics: Opinion Piece

OBS March 2017: The Short List

Posted by Gary Fenton on Mar 13, 2017 2:56:39 PM


The important OBS March 2YO-in-training sale is set for tomorrow, March 14, 2017 and LRF is here trying to find the next Midnight Storm for our horse racing partnerships. Auctions are incredibly exciting. With 2YO’s even more so. It feels like the NFL combine. You have these incredible athletes and it is your job to find Tom Brady from a very talented pool with like-minded competitors swimming around you.The process of finding your horse takes talent, patience, and like anything in life….hard work. Anyone can look when a sale is over and say “I could’ve had that horse for $5,000 more.” The problem with that statement is a sale moves forwardly, not backwards. There are 677 horses at OBS March, so the odds of landing on the same horse as LRF is actually 1 in 677. And when sale is over and the horse is ours… no, you can never, ever just buy that horse for $5,000 more. The only way to buy a horse at auction for the sales price listed is to start at the beginning, like everyone else, and whittle the 677 horses down to your short list. Then you must survive the auction itself and become the winning bidder. It’s grueling.

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Topics: Opinion Piece

Did you Know Nearly 90% of All Revenue Received by LRF Flows to the Entire Horse Racing Industry?

Posted by Gary Fenton on Mar 7, 2017 1:40:04 PM

There are many benefits to owning a share of a Little Red Feather racehorse. First and foremost, you can expect a first-class communal experience owning a championship quality thoroughbred with hands-on management and incredible client communication.  

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Topics: Opinion Piece

Horse Racing Partnerships 101: Seriously, How Much does it Cost to Own & Train a Thoroughbred Racehorse?

Posted by Gary Fenton on Feb 15, 2017 1:13:31 AM

Buying a thoroughbred racehorse can be...should be....the most exciting investment you ever make. There is no better feeling than watching YOUR horse take the lead at the top of the stretch.

BUT HOW MUCH DOES IT COST?

It's the question we get asked the most - - and here's the answer.

Championship quality thoroughbreds cost between $100,000 and $300,000 to purchase and about $45,000 a year in expenses. Of course, buying a thoroughbred is competitive and purchase prices can easily exceed $300,000. We'd like to think if you have the right team representing you, they will be able to find a top thoroughbred racehorse in the range above. Furthermore, if you join a syndicate like Little Red Feather Racing, you can purchase as little as 5% and share in the above costs with fun and like-minded partners all professionally managed. $15,000 upfront and $2,250 per year for 5% allows you to spread your risk and own many horses for less than the cost of owning one on your own!

As for expenses, the $45,000 a year to maintain a racehorse in training (in Southern California) is broken down as follows:

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Topics: Horse Ownership Tips

Horse Racing Partnerships 101: Pegasus World Cup Analysis

Posted by Billy Koch on Jan 23, 2017 12:00:00 PM


The biggest discussion/question/argument in horse racing this week will not be centered around horse racing partnerships. No, all rhetoric this week will surround the world’s richest horse race, the first ever running of the $12M Pegasus World Cup. The mile and an eighth race will be run this Saturday, January 28 at Gulfstream Park in Hallandale Beach, Florida and features a rematch between 2016 Horse of the Year, CALIFORNIA CHROME, and the only horse to beat him in 2016, Eclipse Champion for three-year-olds, ARROGATE.
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Topics: Opinion Piece

Horse Racing Partnerships 101: Is This a Tax Write-Off?

Posted by Gary Fenton on Jan 22, 2017 7:47:54 PM

Owning a racehorse can be the most exciting investment you ever make. But, it is first and foremost an investment. If treated like the business that it is, the IRS affords many of the same protections and write-offs as investing in real estate or other business ventures. 

So, yes, it is a write-off! As long as you can pass the IRS Hobby Loss test (see below). If successful, there is a second test to determine when (and how much) you can write-down. Thankfully, it is generally accepted that investing in horse racing partnerships satisfies the Hobby Loss test.

Test #1 - Hobby Loss Tes
The IRS must first and foremost recognize your investment as a “legitimate business investment". As you can imagine, the IRS won’t blanketly allow taxpayers to write-off just any business investment.  An activity for personal pleasure that doesn’t generate profits is not a legitimate business investment but instead classified as a “hobby”.

Per the IRS, the following factors, although not all inclusive, may help you to determine if your activity is an activity engaged in for profit or a hobby.

  • Does the time and effort put into the activity indicate an intention to make a profit?
  • Do you depend on income from the activity?
  • If there are losses, are they due to circumstances beyond your control or did they occur in the start-up phase of the business?
  • Have you changed methods of operation to improve profitability?Do you have the knowledge needed to carry on the activity as a successful business?
  • Have you made a profit in similar activities in the past?
  • Does the activity make a profit in some years?
  • Do you expect to make a profit in the future from the appreciation of assets used in the activity?
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Topics: Opinion Piece

Horse Racing Partnerships 101: An Interview with Mike Smith

Posted by Billy Koch on Jan 16, 2017 7:06:24 PM


Mike Smith is riding high. Inducted into the Horse Racing Hall of Fame in 2003, Mike has won more Breeders’ Cup races than any other jockey. He was the regular rider for such super stars as Zenyatta, Shared Belief, and Azeri and currently is the rider of Songbird, Unique Bella, and Breeders’ Cup Classic winner, Arrogate. Last November, Mike guided Little Red Feather Racing’s Midnight Storm to his first graded stakes victory at Del Mar in the GIII Native Diver Stakes. We caught up with Mike after a morning of breezing horses at Santa Anita.

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Topics: Horse Ownership Tips

Horse Racing Partnerships 101: Happy New Year

Posted by Billy Koch on Jan 5, 2017 11:30:53 PM


As we start another year, everyone struggles to come up with a worthwhile New Year’s Resolution. Typically, if you are anything like me, we take a look in the mirror and our first resolution is to make sure you get back in the gym! In fact, gym memberships go up substantially in the month of January and, by April – once again if you’re like me – the gym days start to dwindle as the weather starts to heat up. Waste of time and energy. HA!

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Topics: Horse Ownership Tips

Horse Racing Partnerships 101: How Training Expenses Work with an LRF Horse Racing Partnership?

Posted by Gary Fenton on Dec 14, 2016 12:03:13 AM


It’s one of the most frequently asked questions we receive and for good reason. Understanding the risks and exposure is important when evaluating any investment. Owning a share in an LRF horse racing partnership comes with two expenditures. The initial share price to purchase the horse and upkeep/expenses. All partners pay all expenses from “Day 1”, no matter when you purchased your share of the racehorse. While this may seem like a daunting task, with LRF’s customer service, we make it easy.

On average, we budget $50,000 a year in expenses for each horse. Therefore, a 5% share of an LRF racehorse costs the investor $2,500 or - since we bill quarterly - $625 each quarter. In a previous blog we discussed the breakdown of the yearly budget (trainer/vet fee, etc). You can read it here.  LRF does not mark-up expenses or receive a monthly management fee. 

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Topics: Horse Ownership Tips

LRF Cares Update

Posted by Renee Parcell on Oct 9, 2016 1:16:18 PM

As many of you know LRF started LRF Cares in 2016, a 501(c)(3) sponsored charitable organization which provides resources towards the aftercare for horse racing partnership horses and other noteworthy causes.

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Topics: Opinion Piece

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Our blog aims to inform you about fractional racehorse ownership and to entertain those interested in the sport of kings.

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