Thoroughbred racehorse trainers make their living on training thoroughbred racehorses. It does not matter whether the horse being trained can win races. But some trainers will keep a racehorse in their stable that they know will not win in order to receive a daily / monthly income.
Take for example a Kentucky married couple who desired to invest in a racehorse. With prices of thoroughbred's falling to new lows, they decided to purchase a suitable horse. They approached a trainer who had been in the business for more than 20 years, had good statistics for results, and asked him to select the appropriate racehorse. Relying on his expertise, he purchased a yearling at auction for the investors. After paying for training of that thoroughbred for over a year and a half, the couple learned from other trainers that their racehorse had a deformity, that the horse could never run in a race, and that their trainer should have known better. When the couple confronted the trainer, he responded by stating that they said that they wanted a cheap horse!
Of course, this tatic is not limited to small stables nor the inexperienced investor. A professional pinhooker (soneone who buys horses with the intention of reselling them at a higher price) purchased a racehorse from a breeder and sent him to a big time trainer for training and conditioning. After receiving very high bills - including higher than average vet bills, the pinhooker decided to visit the stable and the horse. It seems the horse was not located in the barn where the trainer told the pinhooker the horse was located. After some checking, the pinhooker located her horse in one of the trainer's barns in another state. The pinhooker thereafter contested the charges.
So how does one avoid this type of situation? There is no easy answer. Perhaps the best is to retain the services of an independent trainer who has nothing to gain nor loose in the investment to use as an independent advisor. Do your homework. Check on your horse regularily. Last, before you invest, plan on how you intend to exit the investment.

