Howdy! How's your night going? Can I get you a Diet Pepsi? How's the family?
I'm on the wagering/probability wagon again tonight.
Did you know a "dollar" is a 100 dollars, a "dime" is 1000 dollars and "Action Jackson" is a gambler who wagers every day - day and night in Gambling Lingo?
It's instructive to see what to expect in the world of sports wagering by looking at 10 bets that you have a .5 probability of winning. Assume you bet 110 to make 100. For those 10 bets you risk 1100. If you have just a slight edge (you can pick the results of the event with greater accuracy than using a coin toss) and like I did today, win 5 lose 4 and push on 1 you end up making 60 units.
I've been studying this for about a year now and I can say that the chances of you making money wagering are almost nil. It's the almost that keeps us going.
A 5-4-1 record would be not too bad over time. You are winning 5/9 or 55% of the time. Say you started the day with a bank roll of 1100 dollars. At the end of the day you would have made 60 bucks (500 won - 440 lost). Is this worth it for tying up 1100 dollars and your time for a day? Depends on how much your time is worth I guess. For most of us probably no.
The fun part is to start thinking about winning more money by starting with more or by winning and reinvesting your winnings.
If you started with 11,000 dollars instead of 1100 and repeated your 5-4-1 record betting 11,000 each day for 300 days of the year (with a 65 day vacation) you would be making about 180,000.
Another way to think about this is if you could invest your money at a daily compound rate of 5.5% (instead of making 5.5% a year on your principle like in your savings account you make 5.5% a day). Now we go exponential baby.
Suppose you go to Vegas with your 1100 bankroll play 100 days of the year, keep reinvesting your winnings and going 5-4-1 every day. How much do you think you would have at the end of your 100 days? Another way to think about it is suppose you put 1100 in your 5.5% passbook savings account when you were born and got it back when you were 100 years old.
The answer my friends is for those 100 days of work and your 1100 initial investment you will have $232,615. Even better is if you decided not to sluff off for 265 days but worked 200 days and took a 165 day vacation to the tropical paradise of your choice. After 200 days of work you have $49,190,882.
This is theoretically possible (it's also theoretically possible that given enough attempts you could walk through a wall due to the random nature of your own and the door's atomic structure). Aside from no proof that anyone has ever been successful in Vegas but the Casino owners, one of the obvious faults in the gambling dream is that you would have to find someone willing to take quite large bets as your career progressed. Near the end of your 200 day career you would be making 5 million dollar bets with your 10 bet a day rule and 50 mil bankroll. It's fun to think about anyway...
The Kelly Formula is interesting to read and think about a little.
Reading a little bit about the Martingale theory of wagering is fun too; theoretically you should never lose at roulette with Old Marty's System
Probability, statistics, gambling, wagering, failure analysis, insurance underwriting, actuarial tables, investing or whatever we call it permeates our lives and culture.
Soul has James Brown Godfather of Soul. Probability has Blaise Pascal Godfather of Probability. Blaise mentions betting with Pistoles in this story. I think that was a baseball team in Italy, one of his buddies or a unit of money.
He also figured out some pretty elaborate bets on if God exists or does not exist Pascal's Wager.
The point I think is that wagering, risk taking and games are as old as humankind. There is something deeply ingrained in us that makes us enjoy the thrill.
Maybe taking a risk by going up to someone who could use a hand and offering our own...would be a good risk to take today.
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