|
|
To advertise on these forums, e-mail us. |
|
|
Thread Tools | Search this Thread | Display Modes |
|
#1
|
|||
|
|||
Science and Gambling
__________________
One Drive "If the corporates are treating you poorly , just go elsewhere." "If they need you , they will soon find out." "If you need them , you will soon find out." --moeee _______________________________________________ |
#2
|
|||
|
|||
great video,brilliant!
thanks for sharing... |
#3
|
|||
|
|||
Good watch, actually watched the whole thing.
One thing I was a bit sceptical of, or maybe I have misinterpreted it, but when he was showing how the Kelly criterion works on the coin toss. He was betting 25% per toss, ie a run of 4 wipes him out, yet in his samples it was the best method. That doesn't quite add up to me. |
#4
|
|||
|
|||
it is my understanding that he is offering double odds for a winning toss, compared to normal. He concedes it is a stupid bet on his part.
If you look up a Kelly calculator the odds are an important part of the equation so I guess by doubling the odds on offer he is ensuring the 25% option doesnt get wiped out. I am not a Kelly expert - maybe others know more about this?? |
#5
|
|||
|
|||
Quote:
In an experiment, a mathematician and an engineer enter a room that contains a beautiful woman, leaning against the opposite wall, and are told that every 2 minutes they may move half the remaining distance towards her. The mathematician decries the experiment a waste of time, as he knows that he will never reach the other side of the room if he always halves the remaining distance. The engineer keeps quiet and moves halfway across the room once the first 2 minutes is up. The mathematician can't believe it! Thinking the engineer is a fool, he shouts: "Don't you know you'll never get there!?" The engineer replies: "That may be so, but I'll be close enough for practical purposes..." (Mathematicians and engineers can be female, of course, the joke works better though if it's a female on the other side of the room. And that everyone's heterosexual and up for it. Jokes are hard nowadays....) Technically, the bank doesn't get wiped out using any percentage other than 100%. (In a practical application, you have to bet whole units - not percentages of a cent - and there will be a minimum stake. In the example in the lecture though, it's a non-terminating game). Bet 1 is 25% of bank. If it loses, Bet 2 is 25% of (75% of the original bank) = 3/16 of the original bank, i.e. less than another 25% of the original bank. The 25% is the optimal figure to use - according to the Kelly formula - given the situation he set up. The presenter could have used a different discrepancy between odds on offer and actual chance, he just chose "2 to 1" to easily explain it to the audience. The 25% is guaranteed to eventually give the greatest rate of growth of capital (under the circumstances of this game) than any other constant percentage of bank. Kelly doesn't seem to say much of anything about if you were to vary the percentage of bank that is bet throughout the series (e.g. progressive staking, level stakes, etc). I'm not sure whether there have been other papers which investigate this and - if so - how applicable it would be in a general case, rather than under a specific instance. |
#6
|
|||
|
|||
Gotta admit I get totally bamboozed by these things but I presume that (to make it simple) that we are doubling the bet after a loser when in fact 1 out 3 (approx) favs win! @ odds of about 2-1 (average) i.e level stakes would result in a loss of about 10% on T/O, cos I see it IF youve got a few Billion to play with, you have to win at least a $ or am I way off the thinking here? nothing would surprise me!
|
Thread Tools | Search this Thread |
Display Modes | |
|
|