Topic: Just-Dice.com : Invest in 1% House Edge Dice Game - page 227. (Read 435353 times)

Yep, you can't remove the house edge with strategy.

What you CAN do is devise a betting strategy that with 90% certainty will win you X BTC - but you have to be willing to risk more than 9X BTC.  And you can achieve the same results with a single bet that's a 90% win anyway.

Players with large bankrolls add a ton of variance - totally drowning out all the smaller bets' impact - but they don't change the EV.

Gambling (vs the house) is only so profitable (for operators) because of everyone who thinks they have a system - there's no need to change anything when (as will happen from time to time) one of them wins.  You could lower the variance - by massively dropping the max bet - but why?  Investors just need to accept that backing the house s very +EV but also has massive variance.

The large variance DOES exist largely as a result of the wide range between min and max bets - but raising the min would make it worse and lowering the max would lose volume.  One possible solution is to go the route of allowing investors to choose their exposure level (from, say 0.1% to 10%) with action over the minimum being given only to those accepting that level of risk.  That would allow those who want a much smaller but more reliable profit to choose 0.1%, those who want roughly what happens at present to take 1% and those who essentially want to gamble to take 10%.  I think the complexity it adds doesn't warrant it - but others may have a different view.

Investors need to realise that the same variance which allowed the house to lose this cash also allowed it to rapidly get to double expected edge before.  You can't have fast gains from losing big bets without allowing fast losses from winning ones.

Nakowa doesn't have an infinite bankroll, and there is a max bet on the site, so we're safe!

House edge is 1% - right now the site is at -0.3% - I think I remember it going above 2% before

This sounds like normal variance to me.  Congrats to nakowa though, he pulled out at just the right time to take a big win!  If you want to donate to investors who lost money... my bitcoin address is in my sig

Will

I agree with Dooglus. Nakowa was very lucky, he could have just as well ended up losing it all. There's no way you can know when to stop with martingale. Furthermore, I think that even with the profits disappearing, it was an excellent day for the site. Dooglus has once again proven to be trustworthy. That will attract other whales in the future.

martingale is a winning strat if:

• You have an infinite Bankroll
• There is no max bet on the site

In this case nakowa actually does have infinite bankroll, and the site has a max bet of ~300 BTC (before everyone divested). While it is a "winning" strategy, nakowa could have lost everything and he would be homeless, I would say that's fair.

It isn't a statistical anomaly.  He has a huge bankroll and thinks that the range from min bet to max bet is too high and allows players to successfully martingale if they have a big enough bankroll.

What do you think about that?  Martingale is a losing strategy, no matter what your limits, in my opinion.

No, there was a 5% chance of winning 2000 (based on some crude assumptions). The risk of ruin for the site is much much smaller, provided there is no software flaw that can be exploited.

02:41:14 (2548) don't challenge me, I'm not a gambler, I'm just an amateur mathematician.
02:43:21 (2548) I'm tired. if you really want to watch, wait till tomorrow. I'll start from a very small amount of BTC.
02:44:22 (2548) I'd like dooglus fix the game.
02:44:51 (2548) I'll tell him what to fix.
02:44:57 (2548) not here.
02:44:58 (1) I'm busy making a withdrawal from the cold wallet for nakowa
02:45:09 (1) if anyone's talking to me here, sorry I missed it

Likely or unlikely, I wouldn't have said anything but for nakowa's comments.

If nakowa found a statistical anomaly why did you process the withdrawl? And if he didn't, can you tell us what he said?

So there was only a 5% chance that he was able to clear out the site? Because he was really convinced that he would 99% clear out the site's profit.

If you reduce the maximum bet, the whales will stop coming.

Well its little worse because we need more people betting to allow the house edge to take advantage. We have not had enough bitcoin bet through the system to really get a true house edge.

The fix is this: Get much more bitcoin bet through the system (Get more people betting) and reduce the maximum bet. 1% is far too large. Its possible to have enough of a good run over a few hundred large bets to eat all the bankroll away, the solution is reduce the max and then they have to bet 10 times as many rolls, allowing the house edge to become more apparent.

Variance.
Don't invest money you can't lose.

-700 now..........

He said that...

05:26:11 (2548) if I want to grab the investment of this site all, I could do it. but I think dooglus is one of good guy in the bitcointalk.org, and I was just proving that I might have a point.
05:29:09 (2548) cici is another account I have.

So we need some more people to invest

Yes, but not as more probablw as you might think. His expected return, assuming 100 bets of 100, was 100*100*-0.01=-100. In this case it is equally likely to lose 2000 coins as it is to win 1900.

Its only because he has such as massive bankroll. I think he must have around 10% to 50% of the site bankroll perhaps. His luck can eat away at the profits because his betting so much. Remember we made profits based on many smaller bets.

It should be more probable that he lost 2k coins than he won it, if he has 49.5% chance to win and 50.5% chance to lose.

You are right. Nakowa is back...

It's variance.

The total standard deviation after multiple bets is: SD = sqrt(N)*unitSD*(bet size)

He bet with a bet size between 10 and 250. Lets assume a mean bet size of 100. The unit SD is 1 in this game, so after about 100 bets the total SD is 1000. He realised a 2000 coint profit, which is a 2SD event, or probability of about 5%.

I don't know how many bets were made, but it would not surprise me if it were >100. Then the result is even more likely.

No reason to divest. It was equally probable that the house was up by another 2000 coins