Topic: Stop gambling your coins unless you're playing for entertainment! (Read 4028 times)

I know this is an old post... but indeed I was referring to poker.  And I am not really very skilled as much as I am a talented sand-bagger and game selector.

QFT

A house can be an investment but your home isn't.

Thanks, and I do agree that a house is an investment so don't get me wrong there. If you are financially stable and you can handle it, I don't see a problem. But for me, I have prayed about it, and this is what I've been told to do. 

So do you

He said gambling was a bad idea (it has a negative expectation).

He didn't say that advertising gambling sites was a bad idea (it presumably has some kind of positive expectation).

You could say the same for gambling in any currency.  It's a tax on people who failed statistics.

One question, though: on the one hand, you say gambling's a bad idea.  On the other hand, you have a gambling-related ad in your sig. 

I've played a fair amount of blackjack at bitZino.com.  They occasionally give me a small amount of bitcoin to play with, and when they do I use exactly the strategy you've just "discovered".

Of the 5 or 6 times they've given me bitcoins to play with, in all but one case I lost the whole amount before cashing anything out.  In the most recent case I made gains of about 30%, cashed out the amount they gave me, then lost the rest.

The Martingale strategy is particularly poorly suited for blackjack because sometimes you'll want to double down or split your cards, which artificially increases the amount you've bet on that hand, and so if you lose you'll need to bet even more than double on the next hand to make up for your losses.

I've had slightly better luck playing Martingale on red/black in roulette, because then you can be sure of how many losses you can sustain in a row before you either run out of chips or hit the house maximum.

In my experience though, you need to be betting less than 1/1000th of your bankroll to make it unlikely that you'll bust out, and then you only increase your bankroll by 0.1% each time you're successful.  It gets boring, so I end up increasing my initial bet, which increases the probability of busting.

If you want to double your bankroll, the safest way to do it is to put it all on a single event, rather than gambling the same money over and over.  So if you wouldn't put it all on red because that's too risky, you shouldn't be using the Martingale strategy either, because that is even less likely to result in you doubling your money.

It's fun though, so long as you can stand to lose it all...  Just don't think you've discovered something that works.  It doesn't.

Debt-free is a truly awesome way to live.  I'm getting there...

Personally, I see housing as an investment.  If I am planning to stay put for a while, eventually the payments against the principle would exceed the payments I would be making to rent something similar.

Net gain (loss) = RENTAL_PMT - MORTGAGE_PMT + PRINCIPLE_PMT

Right now, I estimate that a house comparable to mine would rent out for $800, and my current mortgage payment is $1,062, with $221 going to principle.  So I currently have a loss of about $41/month.  If I consider that the money put towards principle could instead be gaining interest at 10%, then I'd also have another $42/month of investment income that I am missing out on.

In a few years though, it'll flop around.  I'll have a net gain each month compared to what I would have had by investing the principle payment and difference between rent/mortgage payment.  Especially once the housing market turns around, and I can count the equity gains as well.  Certainly though, it is at the expense of lack of flexibility for my living situation.  I can't just up and move like a renter could, which can be a significant liability at times.

Anyway, all power to you Yuhfhrh - debt free is an admirable way to live for certain.

Truely a laugh out loud moment. 

I do believe this is how they plan to solve the debt crisis.

Martingaling works every time if you follow these simple rules:

1)  Have an infinite amount of money.
2)  Find a casino that has an infinite amount of money.
3)  Make sure the casino lets you bet an infinite amount.

Follow those simple rules and you're guaranteed to win every time.

Of course, if you have an infinite amount of money, one wonders why you're gambling in the first place, but there you go.

It's not a bad strategy. And if you can self-insure, so much the better for you. It wouldn't require you to sit on the money, it could be invested and liquidated as needed (be careful if you take a loss though).

Personally though, I just pay house insurance. It's pretty cheap. I try to self-insure all other property where reasonable though (including vehicles, but not liability).

Extremely small amounts are only "better" because when you eventually loose thousands of times your initial bet, it won't "hurt" as much since it is still less than a penny.  As soon as you start moving up to pennies and fractions of a dollar, the exponential nature of the Martingale is going to hurt. Starting with an extremely small amount isn't going to protect you from eventual loss, it's just going to make it hurt less.

Gambling can be a form of entertainment for some, but if the house has an edge (and in this case they do), then it isn't a good way to make an income.  If you find it "boring" and aren't playing for fun, then you really shouldn't be playing.  Programming a computer to play for you? You might as well just flush your money down the toilet.  That is how the eventual loss when it comes will feel.

I assure you that if you Martingale long enough you are going to suffer a catastrophic loss.  You will eventually lose more than you've won, and you will bump up against that 10 BTC limit sooner than you expect to.

The winnings when you get blackjack might be somewhat exponential, but most of the time your winnings will be linear while your losses are exponential.  Don't forget that you have to significantly increase the amount you have at risk if you split or double on a hand.  I've had blackjack hands where I split 4 times, doubled on all four and lost on each of them.  That means loosing 8 times the initial bet in a single hand.  When you are already 8 stages into a Martingale, this is going to be 4,096 times your initial bet. Now instead of 1024 as the bet for the ninth stage, you have to jump to 4637.  If you become frightened by the large amounts, you'll back down from the splits and doubles indicated in Basic Strategy which will increase the house edge against you.

I didn't forget. I'm just telling you that this betting strategy will catch up with you eventually.  You haven't discovered something new here. People have been trying to use this betting strategy since the 1700's.  If it worked there wouldn't be any casinos, they'd all be bankrupt by now.

I will gladly pay rent for a place to live, and it doesn't cut into my savings because I consider it a need in order to live.  The money i'm sitting on is being actively used, and is gaining value over the inflation level.

I'll also throw in here that I will never borrow money either, which means no house until I can buy it flat out.

Unless you planned on being homeless until then, you'd be paying rent to someone else, which would cut into your saving up money.  Then, what you would be doing is called "self-insuring."  Considering the value of money deflates over time, you'd be losing money by sitting on it.

Had to comment on this post because it invoked emotion in me lol

My answer is yes to all three.

1. If you aren't drinking coca-cola for entertainment, why are you doing it? Unless you are underweight and in need of the extra calories, drink water.
2. Yes its gambling, there is a 40% chance you just wasted your money. If you need a bottle of coke, buy it for face value. If you don't, then don't buy it.
3. I would never pay for home insurance. Instead I would have plenty of extra funds available before even considering buying a house.

besides you forgot about one thing, if you get on a losing streak and then blackjack you make A LOT more than your initial bid

yea its better with small amounts... its so boring and systematic that i wish i knew something about programing and could just program a computer to play for me, and if i did that i could program a few computers and them all winning small amount of money so as not to go over the max bet of 10BTC... well fuck it i just turned fractions of a penny into a dollar in a few days, and it was a bit fun watching it go up and up. i'm sure i can turn fractions of a dollar into a few dollar... it might be a small gain at a time, but its exponential when you raise the steaks and 10BTC is a maximum that i will probably payout at long before i bet it. 

VERY RISKY.
VERY VERY VERY RISKY.

If you are betting with extremely small amounts  (0.00000001 BTC) and have a large amount to bet with, you will probably not notice how risky it is since loosing 0.00000001 BTC or loosing 0.0008192 BTC is still loosing less than a penny, but keep in mind that loosing 0.00008192 BTC with your doubling strategy will only take a bad streak of 13 losses in a row, whereas loosing 0.0008192 if you are flat betting 0.00000001 BTC per trial without doubling would require a loosing streak of 8192 trials.  Which seems more likely?

It is a well known betting system called the "Martingale", and it is a good way to make sure that you get a bunch of small wins followed by devastating catastrophic losses.

Lets look at an example starting at $5 and the "one time out of ten" that you just mentioned...

You bet $5 and loose.
So, you bet $10 and loose.
So, you bet $20 and loose.
So, you bet $40 and loose.
So, you bet $80 and loose.
So, you bet $160 and loose.
So, you bet $320 and loose.
So, you bet $640 and loose.
So, you bet $1280 and loose.
Then you bet $2560...

Now at this point you have bet a total of $5110.  And if you win this hand how far ahead are you? $5.  That's right you just risked $5110 to chase $5.  Unfortunately, randomness can come with some really long loosing streaks occasionally.  What if you lost on that $2560?  Would you be ready to risk another $5120 to try and catch up all your losses so far?

I'm not sure what the limits are at bitzino, but most casinos have an upper limit on how large of a bet you can place.  What happens when you hit that limit?  Then you can't double your bets anymore.

So while you will slowly win $5 after each sequence of doubling your bet (given the example of a $5 starting bet), when you finally hit a loosing streak that empties your wallet or bumps up against the casinos maximum bet you are likely to loose much more than you won up to that point.