Topic: [POLL] Just-Dice INVESTORS: Do you agree with lowering the max bet? - page 3. (Read 7216 times)

Thanks Oleander.  Is there a thread where you argue your viewpoint on this?

Brilliant.  Guess that fucks over any plan to restrict investors changing their max bet.

Also, if high-risk investors can't change their risk%, they will just divest when whales play, leading to massive fluctuations in bet size that is even worse then today.  (Dooglus can't stop people from divesting all whenever they want)

So, somene can deposit 10,000BTC and set my risk to 10%. They get most the winnings from the whole site from small investors. When whales play, they automatically divest.  If someone writes an open-source bot running this and other investors use it, the site will have massive max bet fluctuations. 

Thats TERRIBLE for gamblers.

Restricting investors to change their max risk only once a day would be a terrible idea!!!!!

If they can't lower their max risk, they will just instantly divest everything, wait for the 24hr period to be over, and re-invest at a lower rate. And that would be WORSE for the max bet fluctuating!!!

1 - Setup multiple JD account.
2 - Setup a bot which use inputs.io withdraws / deposits  (or any offchain wallet) to move funds from one account (0.25%) to another (1%).

If we decide to create this market of risk management, it should at least be capped to 1%.

Hmm, yes. That way you could get closer the true kelly criterion. But you will not be able to react to a sudden max bet, and that will have a bad effect in the long run for you.

Haha!  So the logical investor strategy would be to actively manage.  Just-Dice would be a tease: advertise 500 BTC max bets, and then as soon as we attract a whale and start to dance, the max bet plummets. 

Easily fixed - only allow people to change their risk level once per day.  Then people can't game it - and have to pick the risk level they'll take for ALL action.  The house doesn't need backing for the small bets - so if you want a share of those you should also have to take a similar part of the big action.  People could still divest/reinvest when whales were around - but there's no stopping that whilst giving people control of their money.  And the people who routinely divested when he bet before at 1% risk will likely do the same at .25% risk if a whale starts winning again - so it's not a new problem.

What stops a big investor with 10,000 coins taking their risk to 5% when small fish are playing. Then when whales play, their bot automatically drops the risk to 0.25%, diluting investors like mechs.?

So large investors with a bot that actively manages the risk will fuck smaller investors?

Either way, I think if the max bet is constantly changing so drastically, then whales won't play.

OK that makes sense.  But what if I also increase to *over* 1% when the fishes are playing?  Like Oleander pointed out, would I not be diluting all the other investors that don't actively manage their account?

Either he was cheating or he wasn't.

If he was cheating (which I still believe VERY unlikely) then the solution is to fix whatever needs fixing to stop the cheating working - lowering max bet would be shuffling the deck chairs on the Titanic.

If he wasn't cheating then it's a pity to have changed J-D from being the site whose motto could have been "we welcome whales" to "we shit our pants if a whale swims anywhere near".

And mechs not wanting him to play there because he thinks the whale is an asshole is stupidity climbing to a new peak.  If I offer -EV bets then I'd FAR prefer to have assholes betting against me than people I actually like.  But I'd happily take action from either - that's what the business is for.

The problem I see here is predominantly one of fear from people who want to dump all/a large part of their investment in J-D and treat it like a bank.  Rather than treating it as just one high-variance/high-expectation item in a diverse investment portfolio.

I personally divested yesterday for the first time - but only because I needed more liquid BTC immediately after BTC-TC announced closure (to try to grab some bargains - the few hundred BTC I keep as cash having been used to buy my own investors on BTC-TC/LTC-Global out immediately at full value).  Those funds would have been returning to J-D within weeks - they still might, but if the site loses its big action then EV is going to fall a lot (I don't care about variance - my own bankroll management handles that).

EDIT:  I have no problem with the idea of investors setting their own risk level.  I wasn't keen on it - but it's far preferable to the house using a non-optimal kelly that we can't compensate for.

Indeed.  Let investors (the market) decide.  It is their money being risked.

This is no different in principle from divesting when the whales play.  It's not a new problem.

And really, switching between 1% and .25% is less of a problem than switching between 1% and 0%.

You will lose the big wins. Think of it as a less extreme version of divesting when the whale comes along.

There is some disagreement on this.  I've argued that the JD situation is different enough from the Kelly model that the 1% max bet is not necessarily optimal.  And I think that Nakowa is evidence of this.  Others think the Kelly Criterion is applicable, and all we need to do is wait for Nakowa to go bust.

It's a difficult question... probabilities are notoriously counter-intuitive.

Since we have people who believe in the Kelly Criterion despite our recent experience, maybe the best solution all around is to let investors set their max bet percentage individually.  If the Kelly supporters are right, they'll prosper in the long run.

What will happen is that smart investors with bots will take a majority of the winnings when small fish are playing, and then will drop down to 0.25% when the whales play. Fucking the low-risk investors like mechs who will be stuck at 0.25% by diluting them.

This is exactly the bot that I will be coding.  If it is released as open-source and everybody uses it, you will see wild fluctuations  of max bet size when whales start playing.  This will have the effect of scaring away whales and large bettors who will see the max bet size drop as soon as they start martingaling or playing large.

Of course it would be fairer to all investors if the max bet was static at 0.50%  or 1%, but now investors will be gambling against each-other by diluting each-other at the right times.

What would happen then if I always increased my risk % to something high like 2.5% when the fishes were playing, and then decreased back to 0.25% when a whale comes along?  

Dooglus, and all others that are for lowering the max bet:

Are you aware that expected returns are lower than 50% per year without the whale?

+1  
Setting your own risk % is the solution to this madness.

The number of people disagreeing with Dooglus outnumbers those agreeing by 2:1.

I hope he reconsiders what he's done.  He listened to mechs instead of listening to 30,000BTC in investors who left their money in at 1%.

PROBLEM 1: We have mis-treated our best customer by changing the max bet as he was playing, without evidence that he ever cheated.

Is there some way we can spin this into a positive?  Admit that we mistreated him and then give him VIP status (like his name in the data stream in a more bling-bling colour, his name on a Wall of Fame or Greatest all time Gamblers, some other idea to stoke his ego???)  He asked earlier "don't you think I proved a point?"  Well, he did: he proved that we were not as confident in our advantage as we thought we were.  He deserves some cred here... 


PROBLEM 2: Are we 100% confident that 1% max bet does in fact optimize profits over the long term given fair dice rolls (e.g., does the Kelly criteria consider the dynamic nature of the max bet size and the size of the gambler's bankroll)?

If we do know this as fact, then I don't understand any rationale to make the site "sub-optimal": wouldn't you just be trading expected profits for a more stable income?  If you want more stable profits, then diversify!