Gambling vs. Advantage Play

[StandardDeviant]

I was just reading another post where someone said something like, "I would never gamble. Gamblers are losers. I will only play when I have an advantage." This will sound familiar to all of us, because many of us (including me) tend to think this way. We think we are somehow better situated than the poor gambler who doesn't know what he's doing.

That got me thinking, "How are we better than the regular gambler?" The first response is "APs will realize their EV if they just play correctly and long enough." This is a true statement for all APs in aggregate, but it is not true for an individual AP. The individual AP can only expect a probability distribution centered on EV. In other words half of all APs will never realize their EV no matter how well or how long they play. But we all play on, expecting to reach EV (or better). In other words we gamble on EV+ being our outcome.

So I think the reality is APs gamble with an expectation of approximately 0.5% and gamblers play with an expectation of approximately -0.5%. The probability distributions of both overlap to a significant extent, meaning that some degenerate gamblers will do better than some APs - even in the long run (which few of us reach anyway).

I've recognized that gamblers tend to have a higher average bet than most APs (well, higher than me anyway ). When I'm there betting 1 unit waiting for a positive count, they are swinging their bets from a few units to 50 or more. So I think gamblers' variance tends to be much higher than APs much of the time. And while I don't know how to prove it, I'm gonna bet that most gamblers don't have particularly sound money management. In other words they over bet their bankrolls. Some do not think in terms of bankroll, they play with all the money they have, or that they can borrow. So they have a very high risk of ruin.

So I think reality is:

1. Casinos will hit their EV because they average their results across many thousands of people
2. APs in aggregate will hit their EV for the same reason
3. Individual APs and gamblers are both gambling that their individual outcomes will be on the plus side of the probability distribution
4. More than a few APs will lose money no matter how well they play. We just don't hear much from them because many quit (survivorship bias)
5. APs as a group practice better money management, so they are far less likely than gamblers to suffer a catastrophic result, even though a significant number of both are equally likely to have a losing result

So...successful APs are successful not so much because they play with a probability advantage, but because they play with the advantage of a money management approach that helps guard against disaster. I think they also play with a different purpose, and perhaps this is the true advantage, the reason that advantage play and gambling are so different.

 

[10JQKA]

That got me thinking, "How are we better than the regular gambler?" The first response is "APs will realize their EV if they just play correctly and long enough." This is a true statement for all APs in aggregate, but it is not true for an individual AP. The individual AP can only expect a probability distribution centered on EV. In other words half of all APs will never realize their EV no matter how well or how long they play. But we all play on, expecting to reach EV (or better). In other words we gamble on EV+ being our outcome.

An AP will only 'never' reach EV+ if they go bust. Think about it logically, 50% either side of the EV line would have to be quantified, like 'after 500 hours' but then at some point there will become a point where 2SD is for example 5x starting BR at which point 97.5% of AP's will be above that lower 2SD line, if for instance the lower 2SD line is at 4x BR then almost all AP's have been successful.

Compare this to a gambler, who has the same advantage as an AP onlys is a negative, meaning he has the same chance of making a profit as an AP has of reaching ruin; Possibly slightly higher as they tend to play a more aggressive game compared to their BR. So, 2.5% of gamblers will be above their 2SD line which I still believe will be in the negative?

Not sure how much sense that made just what came into head after reading :grin:

Interesting idea though!

 

[StandardDeviant]

Not sure how much sense that made just what came into head after reading :grin:

Interesting idea though!

It made sense, the problem is it's not quite true the way you describe it. I'll come back to this later. Have to drive into work now.

 

[10JQKA]

It made sense, the problem is it's not quite true the way you describe it. I'll come back to this later. Have to drive into work now.

Brainstorm

 

[StandardDeviant]

Brainstorm

The short answer is that AP results are a probability distribution not a single number. Think of the bell curve, where the height of the line represents a count of the number of players that achieve a given result after a lifetime of play. Half do better than the mean (EV). Half do worse, some far worse. In fairness, some do far better.

The reason that more than half of the APs around here are successful is due, in part, to a phenomenon, called survivorship bias. AP players who failed miserably don't continue, and they don't hang around BJ forums, so we don't hear from them

 

[iCountNTrack]

I was just reading another post where someone said something like, "I would never gamble. Gamblers are losers. I will only play when I have an advantage." This will sound familiar to all of us, because many of us (including me) tend to think this way. We think we are somehow better situated than the poor gambler who doesn't know what he's doing.

That got me thinking, "How are we better than the regular gambler?" The first response is "APs will realize their EV if they just play correctly and long enough." This is a true statement for all APs in aggregate, but it is not true for an individual AP. The individual AP can only expect a probability distribution centered on EV. In other words half of all APs will never realize their EV no matter how well or how long they play. But we all play on, expecting to reach EV (or better). In other words we gamble on EV+ being our outcome.

So I think the reality is APs gamble with an expectation of approximately 0.5% and gamblers play with an expectation of approximately -0.5%. The probability distributions of both overlap to a significant extent, meaning that some degenerate gamblers will do better than some APs - even in the long run (which few of us reach anyway).

I've recognized that gamblers tend to have a higher average bet than most APs (well, higher than me anyway ). When I'm there betting 1 unit waiting for a positive count, they are swinging their bets from a few units to 50 or more. So I think gamblers' variance tends to be much higher than APs much of the time. And while I don't know how to prove it, I'm gonna bet that most gamblers don't have particularly sound money management. In other words they over bet their bankrolls. Some do not think in terms of bankroll, they play with all the money they have, or that they can borrow. So they have a very high risk of ruin.

So I think reality is:

1. Casinos will hit their EV because they average their results across many thousands of people
2. APs in aggregate will hit their EV for the same reason
3. Individual APs and gamblers are both gambling that their individual outcomes will be on the plus side of the probability distribution
4. More than a few APs will lose money no matter how well they play. We just don't hear much from them because many quit (survivorship bias)
5. APs as a group practice better money management, so they are far less likely than gamblers to suffer a catastrophic result, even though a significant number of both are equally likely to have a losing result

So...successful APs are successful not so much because they play with a probability advantage, but because they play with the advantage of a money management approach that helps guard against disaster. I think they also play with a different purpose, and perhaps this is the true advantage, the reason that advantage play and gambling are so different.

Hmm ok whqt shoud l i start with:

First, "the aggregate" concept of APs is totally erroneous, the EV is determined by the game rules, penetration, playing strategy, betting strategy. EVERY HAND YOU PLAY WILL HAVE THAT EV, YOU RUN A SIM of a BILLION HANDS TO DETERMINE THAT VALUE, errors, cover plays, malevolent casino practices can reduce your ev. In order to be on the positive regime, you need to play enough hands so that your accumulated expectations overcome the accumulated standard deviation(1, 2, 3...).

Second, besides the fact that gamblers are totally oblivious to advantageous and non-advantageous situations, the majority of them overbet based on their bankrolls. For instance you will see a person with 2K bankroll or budget(as they call it) betting 2 or 3 blacks not even knowing his basic strategy and playing at 4% disadvantage. They are wiped out almost instantaneously.

 

[Deleted member 3798]

An exception

The short answer is that AP results are a probability distribution not a single number. Think of the bell curve, where the height of the line represents a count of the number of players that achieve a given result after a lifetime of play. Half do better than the mean (EV). Half do worse, some far worse. In fairness, some do far better.

The reason that more than half of the APs around here are successful is due, in part, to a phenomenon, called survivorship bias. AP players who failed miserably don't continue, and they don't hang around BJ forums, so we don't hear from them

Survivorship bias! That's a good one. By the way, XYZ (a failed AP) is an exception to your theory. He still hangs around bj forums. Here are samples of his 450 posts:



02/18/2007

I am no longer the advantage player I used to be. There was a span of several years when I studied and took great pride in the game of Blackjack; it was a passion. I have compiled a large library of books, magazines, articles, and computer software. I have spreadsheets analyzing my statistical gaming history. I have written amateur computer programs verifying basic strategy, aiding my counting skills, and various academic stats. I have read and learned a considerable amount of information from many brilliant players from forums such as this. I have traveled all over the country playing. My game was counter measured and loathed at by the casino. I was a good player and my profits reflected it.

But now it has waned. I am still coming to terms of what went wrong. This is a touchy subject, but I feel that putting my ego aside and coming clean about it is the only way I am going to heal from this. Let’s say you make a simple graph of the x axis being time, and the y axis being profit. I continually demanded that line to be linearly upwards with insufficient x, especially as every session of playing. We all know that this is unsustainable, but I subconsciously refused to accept that. I lost all patience and demanded immediate gratification of earnings. I continually wanted less x and more y, perhaps exponentially. I over bet, played negative counts, played too long and often, sacrificed my health, missed work, and hurt my family and friends in the process. I became the gambler I scoffed at. I now have personally learned what the definition of compulsion really means. It’s an irrational disorder that will drive you crazy. I have realized that negative gambling is really not an intellectual problem, but rather a psychological one. Whether it’s due to genetic and or environmental factors, I don’t know for sure, but I can tell you that it can happen to the best of us.

I don’t wish this problem on my worst enemy. It is a never ending cycle of torment. I am now taking drastic measures to stop it once and for all. Peace to you all, and I wish you all the best.



10/09/2009

that finds accidental correlation that benefits you %0.0000675432?

 

[Automatic Monkey]

The difference is clear: when you are gambling, you need good luck to win.

When you are an AP, you need bad luck to lose, and the casino needs good luck to win. Thus when I walk into a casino, I am forcing them to gamble.

Turns out, casinos don't like to gamble very much!

 

[SleightOfHand]

[/B]

Survivorship bias! That's a good one. By the way, XYZ (a failed AP) is an exception to your theory. He still hangs around bj forums. Here are samples of his 450 posts:



02/18/2007

I am no longer the advantage player I used to be. There was a span of several years when I studied and took great pride in the game of Blackjack; it was a passion. I have compiled a large library of books, magazines, articles, and computer software. I have spreadsheets analyzing my statistical gaming history. I have written amateur computer programs verifying basic strategy, aiding my counting skills, and various academic stats. I have read and learned a considerable amount of information from many brilliant players from forums such as this. I have traveled all over the country playing. My game was counter measured and loathed at by the casino. I was a good player and my profits reflected it.

But now it has waned. I am still coming to terms of what went wrong. This is a touchy subject, but I feel that putting my ego aside and coming clean about it is the only way I am going to heal from this. Let’s say you make a simple graph of the x axis being time, and the y axis being profit. I continually demanded that line to be linearly upwards with insufficient x, especially as every session of playing. We all know that this is unsustainable, but I subconsciously refused to accept that. I lost all patience and demanded immediate gratification of earnings. I continually wanted less x and more y, perhaps exponentially. I over bet, played negative counts, played too long and often, sacrificed my health, missed work, and hurt my family and friends in the process. I became the gambler I scoffed at. I now have personally learned what the definition of compulsion really means. It’s an irrational disorder that will drive you crazy. I have realized that negative gambling is really not an intellectual problem, but rather a psychological one. Whether it’s due to genetic and or environmental factors, I don’t know for sure, but I can tell you that it can happen to the best of us.

I don’t wish this problem on my worst enemy. It is a never ending cycle of torment. I am now taking drastic measures to stop it once and for all. Peace to you all, and I wish you all the best.



10/09/2009

that finds accidental correlation that benefits you %0.0000675432?

Dang, I feel sorry for that guy. Anyway, just giving 1 example does not mean there is no bias. Of course some failed APs are still gonna be around. But probably only a small amount.

 

[StandardDeviant]

Off Track

Hmm ok whqt shoud l i start with:

First, "the aggregate" concept of APs is totally erroneous, the EV is determined by the game rules, penetration, playing strategy, betting strategy. EVERY HAND YOU PLAY WILL HAVE THAT EV, YOU RUN A SIM of a BILLION HANDS TO DETERMINE THAT VALUE...

First, no need to shout.

Next, repeat after me, "Expected value does not guarantee actual value." Knowing the EV does not tell you what your actual result will be after one hand or 1,000,000 hands. You have a 50% chance of doing better, and a 50% chance of doing worse, as I have said.

You know this from your own experience. You play one $10 hand of BJ with the EV of $0.15/hand, and yet you either lose $10, push, win $10 (ignoring naturals and double downs). Notice how none of those outcomes gives you $0.15, and yet that is what you would have me believe my outcome should be.

But it will even out if more hands are played!!!!! Maybe. Maybe not.

If I lose the first 10 hands or the first 20 hands (God forbid), is my next hand more likely to be a winner so that I somehow regress to the mean? Nope. Then by what magic force does every advantage player's results gravitate to the EV as more hands are played? I await your answer in the Voodoo forum.

While the probability is higher that any player will produce a result near EV than multiple standard deviations below or above EV, no player can say with certainty in advance, what her result will be after N hands, even when EV/hand is known in advance. That's a mathematical fact.

What can be said with certainty is that as the number of players (playing the same game by the same rules) approaches infinity, the aggregate actual result of those players approaches EV. This holds no matter how many hands are played. And you can count on it.

 

[StandardDeviant]

The difference is clear: when you are gambling, you need good luck to win.

When you are an AP, you need bad luck to lose, and the casino needs good luck to win. Thus when I walk into a casino, I am forcing them to gamble.

Turns out, casinos don't like to gamble very much!

The point being that both AP and gambler depend on luck (probability) for their outcomes. Neither really knows in advance, with certainty, what their outcome will be after 1 or 1 billion hands.

 

[Deathclutch]

The difference is clear: when you are gambling, you need good luck to win.

When you are an AP, you need bad luck to lose, and the casino needs good luck to win. Thus when I walk into a casino, I am forcing them to gamble.

Turns out, casinos don't like to gamble very much!

When I go to casinos I park where the employees do because I'm there to make money.

 

[StandardDeviant]

When I go to casinos I park where the employees do because I'm there to make money.

LOL. Great quote!

 

[StandardDeviant]

[/B]

Survivorship bias! That's a good one. By the way, XYZ (a failed AP) is an exception to your theory. He still hangs around bj forums.

And your point is????

By the way, survivorship bias is not my theory. Read the Wikipedia post.

 

[StandardDeviant]

Second...gamblers...overbet based on their bankrolls. For instance you will see a person with 2K bankroll or budget(as they call it) betting 2 or 3 blacks not even knowing his basic strategy and playing at 4% disadvantage. They are wiped out almost instantaneously.

Yes, I've seen the same thing and I made that point in the original post. It's poor money management that does most gamblers in. It's not negative EV, because they tend to wipe out far before they play long enough to get to the long run.

 

[10JQKA]

If I lose the first 10 hands or the first 20 hands (God forbid), is my next hand more likely to be a winner so that I somehow regress to the mean?

Depends, whats the TC?

 

[StandardDeviant]

Depends, whats the TC?

To answer that in the general case, we would say the TC is specified as the probability distribution of TCs one would typically see across N billion hands.

And I believe that distribution would be essentially the same from hand number N to hand number N+1, in the general case.

 

[Elhombre]

The difference is clear: when you are gambling, you need good luck to win.

When you are an AP, you need bad luck to lose, and the casino needs good luck to win. Thus when I walk into a casino, I am forcing them to gamble.

Turns out, casinos don't like to gamble very much!

Autom......... one of your best postings, beside I try to do the same,
always with no mercy.

Eh.

 

[StandardDeviant]

Autom......... one of your best postings, beside I try to do the same,
always with no mercy.

Eh.

However, if one side of the game (house or player) gambles, so does the other. Otherwise both are not playing the same game.

 

[10JQKA]

However, if one side of the game (house or player) gambles, so does the other. Otherwise both are not playing the same game.

Depends on your definition of 'gamble'

Walking across the street is a gamble, you could get hit by a car.
Playing the lottery is a gamble, only about 13million to 1.

That said I do agree, both sides are always gambling. The house used to always have the edge as they made the games that way, then skilled players came along to take that edge, then the house started changing rules and pushing the edge back in their favour, then players got even more skilled! etc etc.

Where does it end?

Will there be a point where the house will make the game 'unbeatable'? (CSM's)?

I think not unbeatable, some time after CSM's or what ever they do to make it unbeatable, will even further skilled players come along?

The exciting world, history and future of blackjack, stay tuned