Want to put your money on a horse?

The odds are stacked against earning a million from owning a racehorse. But you can expect modest profits and lots of fun, says James Daley

The biggest event in horse racing's flat season calendar gets under starter's orders at 4.20pm today, as 14 horses battle it out over a mile and four furlongs in the Epsom Derby. If you turn on the TV just before the race, you'll get a glimpse of the industry's finest, decked out in top hat and tails, sipping champagne and preparing to shout their horse all the way home to the finishing post.

The biggest event in horse racing's flat season calendar gets under starter's orders at 4.20pm today, as 14 horses battle it out over a mile and four furlongs in the Epsom Derby. If you turn on the TV just before the race, you'll get a glimpse of the industry's finest, decked out in top hat and tails, sipping champagne and preparing to shout their horse all the way home to the finishing post.

But while all the contenders in this year's Derby may be fielded by seasoned and wealthy owners, you don't have to be a millionaire to get involved in the horse-racing world. For as little as £50 a year, it's possible to own a share in a racehorse, and for a few thousand pounds more, you can own a 25, 50 or even 100 per cent stake in your own colt, filly, mare or stallion.

The cheapest and most straightforward way to become a racehorse owner is to join a syndicate or racing club. There are more than a dozen of these in the UK, and most offer a handful of different packages, at varying costs.

For £59 a year, for example, Racing Shares ( www.racingshares.co.uk) offers you the chance to own a small stake in a horse, equivalent to about an eighth of 1 per cent. You'll get the odd free ticket to the races (with owner's badge), invites to your horse's stables, and monthly newsletters updating you on your horse's progress and upcoming meetings.

With this particular package, any prize money is donated to a horse welfare charity. However, unless your horse turns out to be a big race winner, it's unlikely your share of the prize money will amount to much.

These small shares can make nice gifts and may provide a fun introduction to the life of a racehorse owner. Those with a bit more to spend, however, can buy 1 or even 2.5 per cent stakes for an annual fee of between £200 and £500. Generally, the larger the stake you buy, the more benefits you will get with your package - and the bigger share of any prize money you will receive.

Other clubs, such as the Elite Racing Club ( www.eliteracingclub.co.uk) give you a small stake in 20 horses for £170 a year.

The advantage of racing clubs and syndicates is that they take the hassle out of ownership. All the training, maintenance and organisation required for your horse will be looked after by the syndicate, leaving you to enjoy the finer sides of being an owner. The downside is that, even if your horse is fortunate enough to win some prize money, you're unlikely to receive very much of it once it's been divided between the hundreds of other owners. If you're happy to accept that you're unlikely to make any real money through a syndicate, then it can be a lot of fun.

When looking for a club or syndicate, be careful not to muddle horse-owning clubs with betting syndicates. The latter are professional betting outfits, which either take a fee to provide regular tips for horse-racing punters, or take lump sums to invest on the horses on your behalf. Such collective investment is illegal, unless the syndicate is regulated by the Financial Services Authority (FSA). For a list of syndicates and clubs, you can visit www.racing-index.com/clubs-syndicates.html.

Training and looking after a racehorse is an expensive business. The British Horse Racing Board (BHB) says that the average annual cost of owning a racehorse is £16,500. This can be much higher if your horse runs up a large vet's bill during the year, or if you decide to splash out on an expensive trainer.

But if this sort of money doesn't sound too daunting, and you've got the time and enthusiasm to spare, then owning a horse outright, or with a small number of partners, is the best way to get the full experience as a racehorse owner.

On the other hand, while there are a few happy stories of lucky owners buying horses cheaply, and turning them into multi-million-pound prize winners, the chances are you'll spend a lot more on your horse than it will ever win on the racecourse. So, if you're planning on buying as an investment, you should probably think again.

James Hipwell, the editor of Inside Edge, the UK's biggest gambling magazine, says: "As an investment, racehorses are a nightmare, because they're so expensive. But they're also a lot of fun. You have to remember that Best Mate [three times winner of the Cheltenham Gold Cup] was bought for just £10,000 and has made over £1m in prize money.

"But you need to allow for costs of between £1,500 and £1,800 a month. So, on the basis that your horse may only run once every other month, it would need to win pretty consistently just to wash its own face."

Although the chances of picking up the next Derby or Grand National winner for a song are slim, this remains the main motivation for the professionals.

Motivator, the favourite in today's Derby, cost £75,000 and has already won more than £200,000 in prize money. If he wins again today, he will take his winnings past £1m.

Horse trading: the pros and cons of owning your own runner

Buying your own horse is not as expensive as you may think, especially if you're willing to take a chance on one without any notable breeding or training. Prices start from a few thousand pounds, but can run into hundreds of thousands for the offspring of champions. Broadly speaking, the better known a horse's lineage, the more you'll have to pay, even though winning equine parents are not guaranteed to produce super-fast offspring.

One thing to watch out for when buying is that racehorses are priced in guineas - equivalent to one pound and a shilling, or £1.05 in today's money. Make sure you understand exactly how much you're being asked to shell out when bidding.

Auctions are held at Tattersalls, in Newmarket and Doncaster, almost every month. Different types of horses, at different ages, are sold at different times of the year, so it's worth doing some research before you buy. The British Horseracing Board ( www.bhb.co.uk) and the Racehorse Owners Association ( www.racehorseowners.net) both have detailed guides to buying a racehorse on their websites.

Once you've got your horse, you'll need to find stables to look after it, register its name and its racing colours, and find a trainer to get it raceworthy.

Bear in mind that the upfront cost of actually buying your horse is not the only money you will have to shell out. Add in the cost of stables, vets' fees, trainers and administration charges, and the cost of owning a horse soon mounts up.

In fact, James Hipwell (see main text) reckons the running costs of owning a racehorse can easily total £1,800 a month - in other words your horse needs to be a consistent winner for you to break even.

GAMBLER'S CORNER: 'Hitman' hoping to beat the odds

There are many dreams staked on today's Derby at Epsom. Frankie Dettori, who has yet to ride the winner of the race, tops the list, followed by his patron Sheikh Mohammed, who longs to fill the void left by Dubai Millennium with the achievements of the horse's offspring. Both dreams depend on third-favourite Dubawi.

Going that includes the word "firm" would be the signal for his withdrawal, but Epsom has been watering the turf and the Sheikh is satisfied.

None of today's runners has raced on the course. The favourite, Motivator, did well when stepping up to win the 1m 2f Dante Stakes at York. Gypsy King, probably the best of Aidan O'Brien's four runners, managed the same trip, despite running "green" at Chester. Dubawi has yet to go beyond a mile. Of these three, I fancy Gypsy King to finish on top, but two stealthily backed horses, The Geezer and Walk In The Park, could go close.

If the Derby seems tough, check out tonight's IBF Light-Welterweight Championship between Ricky 'Hitman' Hatton (left) and Kostya Tzsyu in Manchester. Tzsyu, a Russian-born Australian is as hard as a crocodile's head. Totesport make him 2-5, with Hatton 7-4. Best to bet Tzsyu winning in round six (16-1) or 7 (14-1).

'I left my kids outside the betting shop while I watched her race'

There is an old joke about owning racehorses worth repeating. "If you want make a small fortune out of owning horses...it's best to start with a big one." A look at the owners of today's Derby runners reveals men with huge fortunes intact.

For those starting out on pin money, the chances are slimmer. I got involved with a jump race partnership in autumn 1997 that embraced three horses. By spring 1998 one had been sent back by its trainer, while the other two had retired.

But a taste for ownership lingered and I had soon paid £5,000 for a quarter-share of a National Hunt horse called Deadly Doris (above). She was a fine-looking four-year-old but also a head case, eyeballing with menace anyone who came near .

But she ran so well on her debut at Worcester, taking the lead at one point before fading, that I couldn't help being well disposed towards her. In January 1999 she finished fourth in a National Hunt flat race at Huntingdon, in the run-up to the Cheltenham Festival.

She made it to Cheltenham, albeit after the main event, finishing ninth in a mares-only race televised on Channel 4. Still, I'd stood in the parade ring, watched top jockey Brendan Powell get legged up on my horse, and had a few drinks in the posh Owners' Bar.

What hadn't turned up was prize money - just bills. Then the fateful day arrived - 8 November, 2001, at Towcester. My mother-in-law inadvertently prevented me from attending Doris's only win, by arriving back from holiday, obliging my wife to collect her while I picked up our sons from school.

Shamefully, I parked them outside the betting shop while I watched Doris romp home at 14-1. A paltry £15 each way won enough for a month's training fees.

Doris had other place finishes, but last year, at 10, it was time for retirement. On 2 May, she produced a filly foal, restarting the cycle of forlorn hope. Unnamed as yet, the foal will race on the Flat in 2007. I can't see her staying the Derby trip in 2008, but you never know...

By Stan Hey