Each-Way
It is also possible to have an each-way ("e/w") bet, which is simply a combination of a Tote Win with a Tote Place bet. A £1 e/w bet is a total of £2, £1 for the Tote Win and the other £1 is for the Tote Place, and the money is split between the two separate pools (the Win pool and the Place pool).
Bookmakers other than the Tote do not generally offer a place-only bet, but only an each-way bet. This can be seen as a waste by bettors who believe their selection will finish 2nd or 3rd but will not come 1st; since half the money falls on the "win" it is wasted. A non-Tote bookmaker will offer a quarter or a fifth for the e/w component, whereas the Tote place payout, and as such the e/w payout, is as always the betting pool dividend. With the advent of the exchanges, more and more bookmakers are beginning to offer 'place only' markets in an attempt to rival the exchanges. However, there is not a set in stone way for a punter to calculate the place odds as there is with an each-way bet, and the special place only odds offered by bookmakers can vary quite a bit, both bigger and smaller, from the place odds you would receive if betting each-way. This is particularly true in "bad each-way" races, where the place odds are much less generous than if you bet each-way. The upside to this however goes back to what was said above; since the punter does not have to "waste" half their stake on the win part of the bet.
Read more about this topic: Tote Betting