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[Rannasha]

I can outperform your strategy by placing a single bet each month (if I had magic beans, special seeds, dragons and all the yada yada of course).

Are they going to make a giant beenstalk?

@Rannasha, do you have a giant beanstalk? If so, I would like to throw my money at you.

Alas, I do not. Let that not prevent you from throwing money at me though

[Zaih]

No matter what complicated strategy you use, you're better off making a single straight-up bet for the amount you aim to win.

If your goal is to gain 20% per month with a high-probability Martingale-style strategy, your chances are improved by just making a single bet at 1.2x profit each month with the entire capital. The higher the probability you set in your strategy, the less likely it is to hit a losing streak long enough to break your bank, but the more runs you need to do to achieve the same profit, offsetting the reduced chance to lose.

You can run the numbers and see this quite clearly, but there's also an intuitive way to think about it. JD takes, on average, 1% of the amount you bet. If you make a single bet, you have an expected 1% loss on the amount wagered. If you use a Martingale-style strategy, you bet the same money more than once. To achieve, say, 20% profit, your total amount wagered will be more with a Martingale-style strategy than with a single 1.2x profit bet. And since in the long run, you expect your losses to reach 1% of the total amount wagered, the Martingale-style strategy loses. (the 20% profit is an example, it holds true for other values as well)

tldr: Dabs, if you set a monthly profit goal, I can outperform your strategy by placing a single bet each month (if I had magic beans, special seeds, dragons and all the yada yada of course).

I tried explaining this to him for a very long time..

It won't work. He's a persistent bugger, he's having fun though, so fair enough.

[KingOfSports]

Dabs, you pay back 100 BTC for the 92 used, however my question is, from reading one of your "updates" is that you keep some of the profit made. How much does the 92 BTC turn into before you pay people out?

[Hfleer]

Just-Dice is close to 4,000 BTC in profit as I'm typing this.  That's the highest I've ever seen it.  Congratulations to the investors, looks like they've made a decent return quick.

[HollowIP]

If you had 3 BTC to gamble, playing at 49.5%, you would get 2x return back for a win.

3x2=6BTC for one shot win        (profit 3btc)

during a martingale, start with 1BTC

1btc, loss- bet 2btc-win=4btc.   (profit 1btc)

So you definitely make more profit from gambling in one shot, but perhaps have better 'odds' gambling in a martingale.  You would need 3 successful martingale runs in order to make the profit of just 1 all-in gamble.

[infested999]

No matter what complicated strategy you use, you're better off making a single straight-up bet for the amount you aim to win.

...

This was a good explanation.  To simplify it: A single bet with a particular probability of winning has a higher expected value than multiple bets with the same combined probability.

Of course the variance of a single bet is a lot higher then for many multiple bets.

The really important point: all bets have a negative return, the expected value is less than the amount wagered.

I'm convinced that the best strategy is to bet once the amount you are willing to lose and if you win then never bet again because you have maximized you gains.  If you lose then never bet again because you will only lose more.

Someday I will try to write out the expected value of a martingale sequence.  Has somebody done this already?

There is some truth to what Dabs is saying. If you make one single bet there is a 1% house edge. However you can split that bet into two bets and it will reduce the house edge a bit. A martingale with remove a big part of the house edge. But other than 1% you can't change much.

I'm convinced that the best strategy is to bet once the amount you are willing to lose and if you win then never bet again because you have maximized you gains.

At what percent should you make this bet at?

[infested999]

If you had 3 BTC to gamble, playing at 49.5%, you would get 2x return back for a win.

3x2=6BTC for one shot win        (profit 3btc)

during a martingale, start with 1BTC

1btc, loss- bet 2btc-win=4btc.   (profit 1btc)

So you definitely make more profit from gambling in one shot, but perhaps have better 'odds' gambling in a martingale.  You would need 3 successful martingale runs in order to make the profit of just 1 all-in gamble.

That is a stupid post

[HollowIP]

If you had 3 BTC to gamble, playing at 49.5%, you would get 2x return back for a win.

3x2=6BTC for one shot win        (profit 3btc)

during a martingale, start with 1BTC

1btc, loss- bet 2btc-win=4btc.   (profit 1btc)

So you definitely make more profit from gambling in one shot, but perhaps have better 'odds' gambling in a martingale.  You would need 3 successful martingale runs in order to make the profit of just 1 all-in gamble.

That is a stupid post

Well that was nice- I don't suppose you'd actually explain yourself?

[infested999]

If you had 3 BTC to gamble, playing at 49.5%, you would get 2x return back for a win.

3x2=6BTC for one shot win        (profit 3btc)

during a martingale, start with 1BTC

1btc, loss- bet 2btc-win=4btc.   (profit 1btc)

So you definitely make more profit from gambling in one shot, but perhaps have better 'odds' gambling in a martingale.  You would need 3 successful martingale runs in order to make the profit of just 1 all-in gamble.

That is a stupid post

Well that was nice- I don't suppose you'd actually explain yourself?

you basically said that:

You can bet 1 BTC at 49.5% = 1 BTC profit
You can bet 1 BTC at 9.9% = 10 BTC profit

So you definitely make more profit from gambling at 9.9%, but perhaps have better 'odds' gambling in a martingale.

[HollowIP]

If you had 3 BTC to gamble, playing at 49.5%, you would get 2x return back for a win.

3x2=6BTC for one shot win        (profit 3btc)

during a martingale, start with 1BTC

1btc, loss- bet 2btc-win=4btc.   (profit 1btc)

So you definitely make more profit from gambling in one shot, but perhaps have better 'odds' gambling in a martingale.  You would need 3 successful martingale runs in order to make the profit of just 1 all-in gamble.

That is a stupid post

Well that was nice- I don't suppose you'd actually explain yourself?

you basically said that:

You can bet 1 BTC at 49.5% = 1 BTC profit
You can bet 1 BTC at 9.9% = 10 BTC profit

So you definitely make more profit from gambling at 9.9%, but perhaps have better 'odds' gambling in a martingale.

I think you misinterpreted what I said, or perhaps can't read very well.

Point: You make more profit gambling all-in if you win, but MAYBE have better odds with a martingale, although it requires more winning streaks than just the 1 all-in bet.
Also, my post was clearly talking just about 49.5% win chance.

[infested999]

I think you misinterpreted what I said, or perhaps can't read very well.

Point: You make more profit gambling all-in if you win, but MAYBE have better odds with a martingale, although it requires more winning streaks than just the 1 all-in bet.
Also, my post was clearly talking just about 49.5% win chance.

There is more variance if you make multiple bets OR decrease the chance to win.

[HollowIP]

I think you misinterpreted what I said, or perhaps can't read very well.

Point: You make more profit gambling all-in if you win, but MAYBE have better odds with a martingale, although it requires more winning streaks than just the 1 all-in bet.
Also, my post was clearly talking just about 49.5% win chance.

There is more variance if you make multiple bets OR decrease the chance to win.

Of course there is more variance, my point though is that it doesn't change the fact that you need more winnings streaks to make the same profit as an all-in bet though. The odds may begin to work in your favor, which can be more ideal, but youd still actually need to win more that way to gain more.

[infested999]

I think you misinterpreted what I said, or perhaps can't read very well.

Point: You make more profit gambling all-in if you win, but MAYBE have better odds with a martingale, although it requires more winning streaks than just the 1 all-in bet.
Also, my post was clearly talking just about 49.5% win chance.

There is more variance if you make multiple bets OR decrease the chance to win.

Of course there is more variance, my point though is that it doesn't change the fact that you need more winnings streaks to make the same profit as an all-in bet though. The odds may begin to work in your favor, which can be more ideal, but youd still actually need to win more that way to gain more.

You don't need any winning streaks in a martingale, you just need 1 win every once and a while.

[HollowIP]

I think you misinterpreted what I said, or perhaps can't read very well.

Point: You make more profit gambling all-in if you win, but MAYBE have better odds with a martingale, although it requires more winning streaks than just the 1 all-in bet.
Also, my post was clearly talking just about 49.5% win chance.

There is more variance if you make multiple bets OR decrease the chance to win.

Of course there is more variance, my point though is that it doesn't change the fact that you need more winnings streaks to make the same profit as an all-in bet though. The odds may begin to work in your favor, which can be more ideal, but youd still actually need to win more that way to gain more.

You don't need any winning streaks in a martingale, you just need 1 win every once and a while.

That's what I mean by 'winning streaks' - especially if you don't have a bet limit set up. If you need say 5 losses to break you, then you can go for a while, and make good profit, but probably not that 3btc profit you are looking for. that 5 loss streak comes along and takes it all away. So I think we agree that you may have better 'odds' with a martingale, but I still hold to the idea that an all-in bet, if won, is more profitable than a series of martingale wins.

[infested999]

an all-in bet, if won, is more profitable than a series of martingale wins.

Well yea if you win it then of coarse you are going to win money.

[HollowIP]

an all-in bet, if won, is more profitable than a series of martingale wins.

Well yea if you win it then of coarse you are going to win money.

haha that's how gambling works.
Sorry if I sounded offensive too- Didn't mean for it to come across that way.

[infested999]

My point is that your return on a single bet is better than your return on multiple bets.  When considered as a probability.

For a given bankroll you will end up with more money by placing a single bet.

But this is an average over many possible outcomes.  An actual gambler making a single bet has one particular outcome, either wins or loses the entire bankroll.

Here is another way to state it.  If you took the average gain of all the people who make one bet only they would have a higher return than the average of all the people who make many bets.  And of course all of these people would on average have a negative return.

Now that I say it that way it doesn't sound correct.  This is why I avoid saying stuff.  I'll think about it later.

I can't find the post but about 20 pages before this one doog confirms that when you split a bet into two smaller bets, you end up with slightly higher EV

[drawingthesun]

I can't find the post but about 20 pages before this one doog confirms that when you split a bet into two smaller bets, you end up with slightly higher EV

If anyone can find the math for this I would be very happy. This seems counter intuitive at first glance.

My understanding was that house edge is always the same and so EV is always the same. Smaller bets reduce variance and larger bets increase variance (relative to the gamblers bankroll) however EV should be the same.

My reasoning is that no matter the number of bets, the house edge is always of the same proportion. Even if you reduce the variance, in the long run its all the same and anything else is a type of gamblers fallacy.

[HollowIP]

I can't find the post but about 20 pages before this one doog confirms that when you split a bet into two smaller bets, you end up with slightly higher EV

If anyone can find the math for this I would be very happy. This seems counter intuitive at first glance.

My understanding was that house edge is always the same and so EV is always the same. Smaller bets reduce variance and larger bets increase variance (relative to the gamblers bankroll) however EV should be the same.

My reasoning is that no matter the number of bets, the house edge is always of the same proportion. Even if you reduce the variance, in the long run its all the same and anything else is a type of gamblers fallacy.

I mean it makes sense- for example. 3btc bet has 1% edge, which is 0.03, if you did it- 1btc, then 2btc in a martingale its 0.01+0.02 which = 0.03 making the edge the same.

[infested999]

I'm look for the post.

meanwhile, I found this idiot: https://bitcointalk.org/index.php?topic=238613.msg2732846#msg2732846

The original post was deleted but that is mirror^^