So you go to the Casino with a plan ?

[Peter]

LOL! Great analogy.

But, in reality, after almost 20 trips over the past 4-5 years, playing the way I have
summarized, we are not even $5,000 down. Thus it will take us a long time (even
admitting small number statistics) to hit the magic $25,000 shortfall. And, averaging over
probably the 25 years necessary, that is only about $1,000 per year. We do pay for
airfare, but the rooms and meals have been free. What more could we ask for?

Time and averaging solves all problems. And the "enjoyment level" of VP serves as a great
"flywheel", or "governor", which ever way you wish to look at it. Small peanuts for great
entertainment!

.....bl

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000" <nightoftheiguana2000@y...>
wrote:

···

--- In vpFREE@yahoogroups.com, "bornloser1537" <bornloser1537@y...> wrote:
> They may, from time ttime to time,
> seeking a bit more "excitement", or just having had a nice "win",
move up to
> $1 machines, or play some sort of multi-line game.

The light just turned yellow.

[nightoftheiguana2000]

That's about 5 royal cycles, and you have about a 0.5% chance of
playing that without hitting a royal, which would put you down $20,000
from mean. So, I will guess 0.5%. What's the exact answer?

···

--- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:

Yes, the player's longterm RoR on $1 Double Bonus would jump to
54%. That's a huge RoR, right? But here's a question for you.
What do you think the RoR for 500 hours of $1 Double Bonus on a
$25,000 bankroll is? (say, 500 hands/hr). That's 250,000 hands of
Double Bonus.

Answer to come, after your guess!

--Dunbar

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:

>
> I thought it might be worth flushing this out a bit with an
example.
> Let's say Richy Rich plays quarter FPDW perfectly, and naturally,
he
> mostly wins, but even Richy is aware that bad luck is possible,
and if
> he happens to sustain a running net loss of, let's say, $25,000
then
> he will quit and curse the gods and take up something safer like
> rock-paper-scissors tournaments for fun. What are the chances that
> Richy will sustain a $25,000 running net lost? Use:
> http://wizardofodds.com/videopoker/analyzer/CindyProg.html , select
> FPDW, enter bankroll of $25,000/$1.25=20,000 bets, risk of ruin
is: 0%
> . (Technically it is: 0.999346832571955^20000=0.0002%, effectively
> zero). But, now maybe Richy Rich is a bit of a hotdog, and when he
> hears this good news, he decides to take a shot at dollar double
bonus
> to increase his winnings. The situation has just changed, run the
> numbers yourself for details.
>

[nightoftheiguana2000]

My rough guess would be about 70 royal cycles, so about 3 million
hands, which, depending on how much you play, might or might not take
you 25 years.

LOL! Great analogy.

But, in reality, after almost 20 trips over the past 4-5 years,

playing the way I have

summarized, we are not even $5,000 down. Thus it will take us a

long time (even

admitting small number statistics) to hit the magic $25,000

shortfall. And, averaging over

probably the 25 years necessary, that is only about $1,000 per year.

We do pay for

airfare, but the rooms and meals have been free. What more could we

ask for?

Time and averaging solves all problems. And the "enjoyment level"

of VP serves as a great

"flywheel", or "governor", which ever way you wish to look at it.

Small peanuts for great

entertainment!

.....bl

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"

<nightoftheiguana2000@y...>

wrote:
>
> --- In vpFREE@yahoogroups.com, "bornloser1537"

<bornloser1537@y...> wrote:

···

--- In vpFREE@yahoogroups.com, "bornloser1537" <bornloser1537@y...> wrote:

> > They may, from time ttime to time,
> > seeking a bit more "excitement", or just having had a nice "win",
> move up to
> > $1 machines, or play some sort of multi-line game.
>
> The light just turned yellow.
>

[Dunbar]

Pretty good guess, but a little low. The answer my program comes up
with is 3%.

I thought it was interesting that a game with a longterm RoR of 54%
can be played for 500 hours with an RoR of 3%.

--Dunbar

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:

That's about 5 royal cycles, and you have about a 0.5% chance of
playing that without hitting a royal, which would put you down

$20,000

from mean. So, I will guess 0.5%. What's the exact answer?

>
> Yes, the player's longterm RoR on $1 Double Bonus would jump to
> 54%. That's a huge RoR, right? But here's a question for you.
> What do you think the RoR for 500 hours of $1 Double Bonus on a
> $25,000 bankroll is? (say, 500 hands/hr). That's 250,000

hands of

> Double Bonus.
>
> Answer to come, after your guess!
>
> --Dunbar
>
> --- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
> <nightoftheiguana2000@y...> wrote:
>
> >
> > I thought it might be worth flushing this out a bit with an
> example.
> > Let's say Richy Rich plays quarter FPDW perfectly, and

naturally,

> he
> > mostly wins, but even Richy is aware that bad luck is

possible,

> and if
> > he happens to sustain a running net loss of, let's say,

$25,000

> then
> > he will quit and curse the gods and take up something safer

like

> > rock-paper-scissors tournaments for fun. What are the chances

that

> > Richy will sustain a $25,000 running net lost? Use:
> > http://wizardofodds.com/videopoker/analyzer/CindyProg.html ,

select

> > FPDW, enter bankroll of $25,000/$1.25=20,000 bets, risk of

ruin

> is: 0%
> > . (Technically it is: 0.999346832571955^20000=0.0002%,

effectively

> > zero). But, now maybe Richy Rich is a bit of a hotdog, and

when he

> > hears this good news, he decides to take a shot at dollar

double

> bonus
> > to increase his winnings. The situation has just changed, run

the

···

--- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:
> > numbers yourself for details.
> >
>

[nightoftheiguana2000]

the dollar deviation increases per play, using the normal
approximation for 2sd (2%ror) = 2 x sqrt(variance x hands) x $5: at
500 hours 2sd=$26,000 , at 1000 hours 2sd=$37,000 , at 2000 hours
2sd=$53,000 , at 5000 hours 2sd=$84,000 , at 10,000 hours 2sd=$118,000

···

--- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:

Pretty good guess, but a little low. The answer my program comes up
with is 3%.

I thought it was interesting that a game with a longterm RoR of 54%
can be played for 500 hours with an RoR of 3%.

--Dunbar

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:
>
> That's about 5 royal cycles, and you have about a 0.5% chance of
> playing that without hitting a royal, which would put you down
$20,000
> from mean. So, I will guess 0.5%. What's the exact answer?
>
> --- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:
> >
> > Yes, the player's longterm RoR on $1 Double Bonus would jump to
> > 54%. That's a huge RoR, right? But here's a question for you.
> > What do you think the RoR for 500 hours of $1 Double Bonus on a
> > $25,000 bankroll is? (say, 500 hands/hr). That's 250,000
hands of
> > Double Bonus.
> >
> > Answer to come, after your guess!
> >
> > --Dunbar
> >
> > --- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
> > <nightoftheiguana2000@y...> wrote:
> >
> > >
> > > I thought it might be worth flushing this out a bit with an
> > example.
> > > Let's say Richy Rich plays quarter FPDW perfectly, and
naturally,
> > he
> > > mostly wins, but even Richy is aware that bad luck is
possible,
> > and if
> > > he happens to sustain a running net loss of, let's say,
$25,000
> > then
> > > he will quit and curse the gods and take up something safer
like
> > > rock-paper-scissors tournaments for fun. What are the chances
that
> > > Richy will sustain a $25,000 running net lost? Use:
> > > http://wizardofodds.com/videopoker/analyzer/CindyProg.html ,
select
> > > FPDW, enter bankroll of $25,000/$1.25=20,000 bets, risk of
ruin
> > is: 0%
> > > . (Technically it is: 0.999346832571955^20000=0.0002%,
effectively
> > > zero). But, now maybe Richy Rich is a bit of a hotdog, and
when he
> > > hears this good news, he decides to take a shot at dollar
double
> > bonus
> > > to increase his winnings. The situation has just changed, run
the
> > > numbers yourself for details.
> > >
> >
>

[nightoftheiguana2000]

of course, this is assuming a breakeven game

including the expected return for 1sd(16%ror):
(er-1+cashback)x hands - sqrt(variance x hands) bets

which gives a crossover of N0=variance/(er-1+cashback)^2 hands (84%
chance of net winning) and a minimum at N0/4 hands

for FPDW, N0=450,000 hands, minimum at 113,000 hands
for 10/7DB, N0=10 million hands, minimum at 2.4 million hands

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:

···

the dollar deviation increases per play, using the normal
approximation for 2sd (2%ror) = 2 x sqrt(variance x hands) x $5: at
500 hours 2sd=$26,000 , at 1000 hours 2sd=$37,000 , at 2000 hours
2sd=$53,000 , at 5000 hours 2sd=$84,000 , at 10,000 hours 2sd=$118,000

--- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:
>
> Pretty good guess, but a little low. The answer my program comes up
> with is 3%.
>
> I thought it was interesting that a game with a longterm RoR of 54%
> can be played for 500 hours with an RoR of 3%.
>
> --Dunbar
>
>
>
> --- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
> <nightoftheiguana2000@y...> wrote:
> >
> > That's about 5 royal cycles, and you have about a 0.5% chance of
> > playing that without hitting a royal, which would put you down
> $20,000
> > from mean. So, I will guess 0.5%. What's the exact answer?
> >
> > --- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:
> > >
> > > Yes, the player's longterm RoR on $1 Double Bonus would jump to
> > > 54%. That's a huge RoR, right? But here's a question for you.
> > > What do you think the RoR for 500 hours of $1 Double Bonus on a
> > > $25,000 bankroll is? (say, 500 hands/hr). That's 250,000
> hands of
> > > Double Bonus.
> > >
> > > Answer to come, after your guess!
> > >
> > > --Dunbar
> > >
> > > --- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
> > > <nightoftheiguana2000@y...> wrote:
> > >
> > > >
> > > > I thought it might be worth flushing this out a bit with an
> > > example.
> > > > Let's say Richy Rich plays quarter FPDW perfectly, and
> naturally,
> > > he
> > > > mostly wins, but even Richy is aware that bad luck is
> possible,
> > > and if
> > > > he happens to sustain a running net loss of, let's say,
> $25,000
> > > then
> > > > he will quit and curse the gods and take up something safer
> like
> > > > rock-paper-scissors tournaments for fun. What are the chances
> that
> > > > Richy will sustain a $25,000 running net lost? Use:
> > > > http://wizardofodds.com/videopoker/analyzer/CindyProg.html ,
> select
> > > > FPDW, enter bankroll of $25,000/$1.25=20,000 bets, risk of
> ruin
> > > is: 0%
> > > > . (Technically it is: 0.999346832571955^20000=0.0002%,
> effectively
> > > > zero). But, now maybe Richy Rich is a bit of a hotdog, and
> when he
> > > > hears this good news, he decides to take a shot at dollar
> double
> > > bonus
> > > > to increase his winnings. The situation has just changed, run
> the
> > > > numbers yourself for details.
> > > >
> > >
> >
>

[cdfsrule1]

So many things to comment on, I just don't know where to start...

1) Kelly? Why Kelly? Just as EV isn't king, either is Kelly. There are an infinite number of
wyays folks might optimize their betting amounts and playing strategies and kelly is just
one of them. If you looked around you should find that Kelly isn't even the most common
(that is, people more commonly use a modified version of Kelly-- or a Kelly inspired
strategy than a strict Kelly strategy). Ask yourself the "kelly question".. do I really value my
money logarithmically? That is, Do you really beelive that a total loss of your bankroll is
infinitely bad? If so, Kelly just might be for you. Personally, I can think of many more
things worse than losing my entire bankroll.... So while Kelly may be your red light, its not
mine.

2) Is bankroll truly a static concept? (kelly assumes otherwise). Couldn't Bankroll depend
on time? In a few ways: first, our money might grow (or not!) with time (investments, etc),
we might earn more (or less) with time, and we may need to spend more (or less) with
time. And finally, there surely comes a point when we don't need our money anymore (you
can't take it with you). And finally, our bankroll changes as we play. The practical issue
with Bill Gates is that no matter how much he would play VP, he couldn't lose at a rate that
approached what his savings earns while he sleeps. Nice problem to have. That said, I
know a couple centimillionaires who wouldn't even play a single $5 hand of blackjack--
but they would readily write a $100K check to be an angel in investor in a startup.
Different types of gambling and different stakes for different folks at different times in
their lives. Yes, back to time...... this is taking too much time to type....

3) Why use an normal distribution? Why not compute the actual PDF? For any reasonable
length session, the normal distribution is a poor approximation.. using it (or assuming it,
as when one makes "kelly" computations) is not the thing to do....

4) I was realy struck by these comments:

Each hand of video poker is random and independent of the prior hand,
at least in states with fair regulated gambling, thus session win/loss
limits don't affect long term results.

What does affect long term results? If a session results don't what does?

Well, when we gamble (or at least when I do), I know that at the end of a session I have
either lost, won or broken even. If I beleive in the "long term" and the "independance each
hand" I know that if I have lost money for that session, that in the "long term" I am going
to be down exactly that amount (assuming the game I am playing is exactly 100%). Yes,
there is a HUGE difference between what has happened already (the stuff I know like the
result of a session) and what hasn't happend yet. My long term results NOT including
what has already happened should ultimately approach the EV of the game (given
sufficient bankroll, etc). But my long term results INCLUDING what has already happened (
a loss!), SHOULD NOT approach the EV of the game. That is, there is no FORCE in VP that
makes us hit the EV. There is no regression to the mean-- once we include results we
already know! I think that bears repeating: there is NO restoring force in VP. IMHO, that is
the equivalent statement to: each hand is independant. The only thing that makes
coming back possible is the variance (and other higher moments) of the game and the fact
that we do not play forever-- can not play forever. IMHO, It is a good thing that I never
reach the long run, (at least once I have a lossing session, that is.. but right after I hit that
$400K RF, I'd be happy to reach the long run or maybe I should quite then, cause the
EV<1. LOL)

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000" <nightoftheiguana2000@y...>
wrote:

···

of course, this is assuming a breakeven game

including the expected return for 1sd(16%ror):
(er-1+cashback)x hands - sqrt(variance x hands) bets

which gives a crossover of N0=variance/(er-1+cashback)^2 hands (84%
chance of net winning) and a minimum at N0/4 hands

for FPDW, N0=450,000 hands, minimum at 113,000 hands
for 10/7DB, N0=10 million hands, minimum at 2.4 million hands

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:
>
> the dollar deviation increases per play, using the normal
> approximation for 2sd (2%ror) = 2 x sqrt(variance x hands) x $5: at
> 500 hours 2sd=$26,000 , at 1000 hours 2sd=$37,000 , at 2000 hours
> 2sd=$53,000 , at 5000 hours 2sd=$84,000 , at 10,000 hours 2sd=$118,000
>
> --- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:
> >
> > Pretty good guess, but a little low. The answer my program comes up
> > with is 3%.
> >
> > I thought it was interesting that a game with a longterm RoR of 54%
> > can be played for 500 hours with an RoR of 3%.
> >
> > --Dunbar
> >
> >
> >
> > --- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
> > <nightoftheiguana2000@y...> wrote:
> > >
> > > That's about 5 royal cycles, and you have about a 0.5% chance of
> > > playing that without hitting a royal, which would put you down
> > $20,000
> > > from mean. So, I will guess 0.5%. What's the exact answer?
> > >
> > > --- In vpFREE@yahoogroups.com, "dunbar_dra" <h_dunbar@h...> wrote:
> > > >
> > > > Yes, the player's longterm RoR on $1 Double Bonus would jump to
> > > > 54%. That's a huge RoR, right? But here's a question for you.
> > > > What do you think the RoR for 500 hours of $1 Double Bonus on a
> > > > $25,000 bankroll is? (say, 500 hands/hr). That's 250,000
> > hands of
> > > > Double Bonus.
> > > >
> > > > Answer to come, after your guess!
> > > >
> > > > --Dunbar
> > > >
> > > > --- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
> > > > <nightoftheiguana2000@y...> wrote:
> > > >
> > > > >
> > > > > I thought it might be worth flushing this out a bit with an
> > > > example.
> > > > > Let's say Richy Rich plays quarter FPDW perfectly, and
> > naturally,
> > > > he
> > > > > mostly wins, but even Richy is aware that bad luck is
> > possible,
> > > > and if
> > > > > he happens to sustain a running net loss of, let's say,
> > $25,000
> > > > then
> > > > > he will quit and curse the gods and take up something safer
> > like
> > > > > rock-paper-scissors tournaments for fun. What are the chances
> > that
> > > > > Richy will sustain a $25,000 running net lost? Use:
> > > > > http://wizardofodds.com/videopoker/analyzer/CindyProg.html ,
> > select
> > > > > FPDW, enter bankroll of $25,000/$1.25=20,000 bets, risk of
> > ruin
> > > > is: 0%
> > > > > . (Technically it is: 0.999346832571955^20000=0.0002%,
> > effectively
> > > > > zero). But, now maybe Richy Rich is a bit of a hotdog, and
> > when he
> > > > > hears this good news, he decides to take a shot at dollar
> > double
> > > > bonus
> > > > > to increase his winnings. The situation has just changed, run
> > the
> > > > > numbers yourself for details.
> > > > >
> > > >
> > >
> >
>

[Dunbar]

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:

the dollar deviation increases per play, using the normal
approximation for 2sd (2%ror) = 2 x sqrt(variance x hands) x $5: at
500 hours 2sd=$26,000 , at 1000 hours 2sd=$37,000 , at 2000 hours
2sd=$53,000 , at 5000 hours 2sd=$84,000 , at 10,000 hours

2sd=$118,000

That kind of calculation will always underestimate the chance of
going broke during a session because it is looking only at the end-
point distribution. Often the underestimation of RoR will be severe.

For example, compare the values for our Double Bonus player at 500
hours for 1sd. Sqrt(variance x hands) x $5 = $13,289. But does
$13,289 have an RoR anywhere near 16%, as the 1sd calculation might
suggest? No. The actual RoR is 26%. So the end-point calculation
misses well over 1/3 of the ruins!

--Dunbar

(26% figure comes from "Dunbar's Risk Analyzer for Video Poker")

[Dunbar]

I like thinking in terms of "NO". But, again, it's more relevant to
situations where you know you will not run out of money.

btw, as far as I know, I was the first to post about the minimum in
(ev-1sd). (as well as for other number of sd's). It was years ago
on bjmath.com. I tried to coin the symbol Nhell, with "hell" as a
subscript. Needless to say, it didn't catch on. I thought the idea
of a minimum "ev-sd" was a cool idea, although others (on bjmath)
were less excited.

--Dunbar

--- In vpFREE@yahoogroups.com, "nightoftheiguana2000"
<nightoftheiguana2000@y...> wrote:

···

of course, this is assuming a breakeven game

including the expected return for 1sd(16%ror):
(er-1+cashback)x hands - sqrt(variance x hands) bets

which gives a crossover of N0=variance/(er-1+cashback)^2 hands (84%
chance of net winning) and a minimum at N0/4 hands

for FPDW, N0=450,000 hands, minimum at 113,000 hands
for 10/7DB, N0=10 million hands, minimum at 2.4 million hands

[nightoftheiguana2000]

So many things to comment on, I just don't know where to start...

1) Kelly? Why Kelly? Just as EV isn't king, either is Kelly.

Kelly is just the optimum strategy for bankroll growth. If bankroll
growth is your goal, Kelly would be king, if you have other goals,
then other strategies would be called for.

2) Is bankroll truly a static concept? (kelly assumes otherwise).

Bankroll varies, up or down, with play, or additions or subtractions.
Kelly strategy takes this into account, that is the optimum strategy
is a function of bankroll, whereas max-ER or min-ROR strategy is not.

3) Why use an normal distribution?

It's an approximation. Exact values can also be calculated, but of
course require more time to calculate.

4) I was realy struck by these comments:

> Each hand of video poker is random and independent of the prior hand,
> at least in states with fair regulated gambling, thus session win/loss
> limits don't affect long term results.
>

What does affect long term results? If a session results don't what

does?

I wrote: "session win/loss limits". In fair video poker, session
win/loss limits affect the duration of a session, but not the overall
net running cumulative long term results. Same goes for the Martingale
system, it affects a session (most sessions are winners), but not the
long term results (where an eventual big loss nullifies the many small
wins). If your goal is a winning session, the Martingale is the way to
go, if your goal is a net cumulative win the Martingale has no affect
on average expected win/loss.

···

--- In vpFREE@yahoogroups.com, "cdfsrule" <groups.yahoo@v...> wrote:

[Peter]

Actually, I took some Advil. I feel lots better now. <grin>

.....bl

···

--- In vpFREE@yahoogroups.com, "Bob Dancer" <bob.dancer@c...> wrote:

Mr. not-Bill-Gates said: WOW! I can't believe it. I agree TOTALLY
with Mr. Dancer.

It might not be fatal. Take two aspirins and lie down. You just might
make it through.

[Steve_Jacobs]

> So many things to comment on, I just don't know where to start...
>
> 1) Kelly? Why Kelly? Just as EV isn't king, either is Kelly.

Kelly is just the optimum strategy for bankroll growth. If bankroll
growth is your goal, Kelly would be king, if you have other goals,
then other strategies would be called for.

I don't think it is that simple, for two reasons. First, the Kelly Criterion
is an approximate formula rather than an exact calculation, and its
purpose is to choose the bet size which gives the highest _geometric_
growth rate. I put emphasis on _geometric_ because that is only one
way to talk about "bankroll growth". If you want to grow a bankroll by
adding as much as possible each time you play, then max-EV strategy
with a "bet it all" philosophy will achieve optimal "bankroll growth".
Using a true log-optimal approach with both the playing strategy and
betting strategy will, on average, multiply the bankroll be the largest
factor, causing the bankroll to grow exponentially. Kelly is a quick
and dirty formula that really only addresses betting strategy.

> What does affect long term results? If a session results don't what

does?

I wrote: "session win/loss limits". In fair video poker, session
win/loss limits affect the duration of a session, but not the overall
net running cumulative long term results. Same goes for the Martingale
system, it affects a session (most sessions are winners), but not the
long term results (where an eventual big loss nullifies the many small
wins). If your goal is a winning session, the Martingale is the way to
go, if your goal is a net cumulative win the Martingale has no affect
on average expected win/loss.

I doubt that a simple Martingale can be applie effectively in video
poker, because of the broad range of payoffs. Martingale is better
suited to games with a single N:1 payoff. Also, the statement that
a Martingale doesn't affect long term results is only true for someone
who is using EV to measure results. Progressions can't alter EV, but
they can have a very significant impact on risk and probability of
survival.

···

On Friday 23 December 2005 02:12 am, you wrote:

--- In vpFREE@yahoogroups.com, "cdfsrule" <groups.yahoo@v...> wrote:

[nightoftheiguana2000]

modified martingale:
http://www.vptruth.com/stratsingleplay.cfm

···

--- In vpFREE@yahoogroups.com, Steve Jacobs <jacobs@x...> wrote:

I doubt that a simple Martingale can be applie effectively in video
poker, because of the broad range of payoffs.

[Steve_Jacobs]

You cite Rob Singer? Even he doesn't claim what is described
as a Martingale.

···

On Friday 23 December 2005 09:33 am, nightoftheiguana2000 wrote:

--- In vpFREE@yahoogroups.com, Steve Jacobs <jacobs@x...> wrote:
> I doubt that a simple Martingale can be applie effectively in video
> poker, because of the broad range of payoffs.

modified martingale:
http://www.vptruth.com/stratsingleplay.cfm

[Chandler1]

That often touted 3 to 5 royal allowance as a good bankroll is mostly for
very good games (fpdw, for example) with slot benefits. My local NSUD game
(with slot benefits) is more like a 10 royal bankroll to get you a 5% ROR.
Play the quarter multis and a 5% ROR requires well over $10K. Either you
have very good slot benefits, or you may not have a realistic expectation of
the bankroll requirements for your play.

Chandler

···

-----Original Message-----
From: vpFREE@yahoogroups.com [mailto:vpF…@…com]On Behalf Of
nirpam
Sent: Tuesday, December 20, 2005 5:08 PM
To: vpFREE@yahoogroups.com
Subject: [vpFREE] So you go to the Casino with a plan ?

My post is aiming to clarify some basic questions. So you go to the
Casino with a plan to win and you have the appropriate bankroll for
it. Say you will play NSUD and you have the 3 or 5 royal x
bankroll. So you start playing and then what.
Q When do you stop ? based on the time spent ? points earned ? or
you are winning or losing ?
Q Say you hit a royal and you get a w 2. Do you stop playing ? Why
stop as it does not matter, the RNG does not know that and if you
are playing correct you need to keep playing right ??
Q Say you have a "budget" of 10,000 $ to play and you obviously want
to win and maybe get comps too. What is the ideal strategy ? Which
type of video poker will you play ? Obviously this is assuming there
is no full pay around. I live in KC and play at Ameristar etc. Any
local recommendations are welcome.

Thanks for your time and effort.

vpFREE Links: http://members.cox.net/vpfree/Links.htm

Yahoo! Groups Links

[cdfsrule1]

NOTI...

I recommend you take a look at how Kelly is derived. I beleive the function being
optimized in kelly is NOT bankroll growth alone, but rather "how I fell about a certain win/
loss" where tht quantity is defined by,

"How I feel..." = log (current bankroll / starting bank roll)

This funtion ranges from:
  "+infinity" (as in I feel infinitely good that I won so much money!) to
" - infinity" (I feel infinitely bad that I lost my entire starting bank roll!).
In between is 0, which is for exactly even, neither up nor down.

The problem is, that I don't "feel" this way about my bankroll! So for me, Kelly doesn't
apply. Period.

Turning it around the other way, in order to kelly to apply, the "starting bank roll" must be
a quantity that I feel infinity bad about losing...as other people have pointed out, there
may not realy be such a quantity.

Kelly also requires that pesky puer-"log" dependance. Many other "functions" would do
just fine. Log is nice, and it enables (given some other contraints) Kelly to be easily solved
(or nice approximations found).... but a pure log is not a requirement. The fact that kelly
can produce a geometrical growth of bankroll is just the result of optimzing the log-how I
fell function. If one set out to optimize bankroll growth, you would (likely) come up with
something else (other than kelly), as Steve has already pointed out.

···

--- In vpFREE@yahoogroups.com, Steve Jacobs <jacobs@x...> wrote:

On Friday 23 December 2005 02:12 am, you wrote:
> --- In vpFREE@yahoogroups.com, "cdfsrule" <groups.yahoo@v...> wrote:
> > So many things to comment on, I just don't know where to start...
> >
> > 1) Kelly? Why Kelly? Just as EV isn't king, either is Kelly.
>
> Kelly is just the optimum strategy for bankroll growth. If bankroll
> growth is your goal, Kelly would be king, if you have other goals,
> then other strategies would be called for.

I don't think it is that simple, for two reasons. First, the Kelly Criterion
is an approximate formula rather than an exact calculation, and its
purpose is to choose the bet size which gives the highest _geometric_
growth rate.

[nightoftheiguana2000]

NOTI...

I recommend you take a look at how Kelly is derived. I beleive the

function being

optimized in kelly is NOT bankroll growth alone, but rather "how I

fell about a certain win/

loss" where tht quantity is defined by,

"How I feel..." = log (current bankroll / starting bank roll)

Kelly optimizes mean geometric bankroll growth.

This funtion ranges from:
  "+infinity" (as in I feel infinitely good that I won so much

money!) to

" - infinity" (I feel infinitely bad that I lost my entire starting

bank roll!).

In between is 0, which is for exactly even, neither up nor down.

The problem is, that I don't "feel" this way about my bankroll! So

for me, Kelly doesn't

apply. Period.

That's true, if you have no feelings about your bankroll at all, the
Kelly strategy would not apply. Also, I would like to be your stock
broker, I have some picks I think you will like. For that matter, I
would like to be your personal financial manager. Rest assured, every
year I will send you a nice birthday card, or whatever else makes you
happy, as long as you don't ask for details about your account.

Turning it around the other way, in order to kelly to apply, the

"starting bank roll" must be

a quantity that I feel infinity bad about losing...as other people

have pointed out, there

may not realy be such a quantity.

Really? So, if you lost 50 grand in a year, it wouldn't effect you at
all? How would you feel about sending 50 grand to my favorite charity?

Kelly also requires that pesky puer-"log" dependance. Many other

"functions" would do

just fine. Log is nice, and it enables (given some other

contraints) Kelly to be easily solved

(or nice approximations found).... but a pure log is not a

requirement. The fact that kelly

can produce a geometrical growth of bankroll is just the result of

optimzing the log-how I

fell function. If one set out to optimize bankroll growth, you would

(likely) come up with

something else (other than kelly), as Steve has already pointed out.

I think Steve only clarifed that Kelly optimizes mean geometric
bankroll growth, and that it is an approximation, not an exact
solution. If I read Steve correctly, he prefers the term log-optimal
strategy, which is mathematically more precise, and is one of his
alternative strategies that he was written about in the past. See
also: http://members.cox.net/vpfree/FAQ_S.htm . I prefer the term
Kelly because it gives another way for someone to research the topic.
I.e.: http://www.google.com/search?q=kelly+gambling+strategy

>
> > > So many things to comment on, I just don't know where to start...
> > >
> > > 1) Kelly? Why Kelly? Just as EV isn't king, either is Kelly.
> >
> > Kelly is just the optimum strategy for bankroll growth. If bankroll
> > growth is your goal, Kelly would be king, if you have other goals,
> > then other strategies would be called for.
>
> I don't think it is that simple, for two reasons. First, the

Kelly Criterion

···

--- In vpFREE@yahoogroups.com, "cdfsrule" <groups.yahoo@v...> wrote:

--- In vpFREE@yahoogroups.com, Steve Jacobs <jacobs@x> wrote:
> On Friday 23 December 2005 02:12 am, you wrote:
> > --- In vpFREE@yahoogroups.com, "cdfsrule" <groups.yahoo@v...> wrote:
> is an approximate formula rather than an exact calculation, and its
> purpose is to choose the bet size which gives the highest _geometric_
> growth rate.

[Steve_Jacobs]

> NOTI...
>
> I recommend you take a look at how Kelly is derived. I beleive the

function being

> optimized in kelly is NOT bankroll growth alone, but rather "how I

fell about a certain win/

> loss" where tht quantity is defined by,
>
> "How I feel..." = log (current bankroll / starting bank roll)

Kelly optimizes mean geometric bankroll growth.

Well, approximately.

> This funtion ranges from:
> "+infinity" (as in I feel infinitely good that I won so much

money!) to

> " - infinity" (I feel infinitely bad that I lost my entire starting

bank roll!).

> In between is 0, which is for exactly even, neither up nor down.
>
> The problem is, that I don't "feel" this way about my bankroll! So

for me, Kelly doesn't

> apply. Period.

That's true, if you have no feelings about your bankroll at all, the
Kelly strategy would not apply. Also, I would like to be your stock
broker, I have some picks I think you will like. For that matter, I
would like to be your personal financial manager. Rest assured, every
year I will send you a nice birthday card, or whatever else makes you
happy, as long as you don't ask for details about your account.

He didn't say he has no feeling about his bankroll, he merely said
that his feelings don't necessarily map well to the Kelly viewpoint.

> Turning it around the other way, in order to kelly to apply, the

"starting bank roll" must be

> a quantity that I feel infinity bad about losing...as other people

have pointed out, there

> may not realy be such a quantity.

Really? So, if you lost 50 grand in a year, it wouldn't effect you at
all? How would you feel about sending 50 grand to my favorite charity?

I don't think that's what he's saying. I think he is only saying that Kelly
doesn't necessarily apply to everyone. I would agree with that. I might
even claim to be such a person.

The problem with Kelly is that you have to define "bankroll" to include
one's entire net worth, and to exclude the possibility of income from
another source. Then, if you lose everything, you are truly screwed.
Even if you do that, I believe there are people who would risk it all
for a good shot at a huge reward. For such people, the Kelly model
doesn't apply (at least, not perfectly).

The argument can be simplified to "would you risk your very existence
for a high probability of a truly massive reward?" After all, we risk our
lives every time we go out driving on the freeway, and generally the
reward at the end of our drive can't possibly be justified in Kelly terms.

The very thrill of a huge payoff could trigger a massive heart attack that
kills you. If you want to take that and stretch it to the logical extreme,
then maybe Kelly's message is "don't gamble if the big payoff might
kill you"

> Kelly also requires that pesky puer-"log" dependance. Many other

"functions" would do

> just fine. Log is nice, and it enables (given some other

contraints) Kelly to be easily solved

> (or nice approximations found).... but a pure log is not a

requirement. The fact that kelly

> can produce a geometrical growth of bankroll is just the result of

optimzing the log-how I

> fell function. If one set out to optimize bankroll growth, you would

(likely) come up with

> something else (other than kelly), as Steve has already pointed out.

I think Steve only clarifed that Kelly optimizes mean geometric
bankroll growth, and that it is an approximation, not an exact
solution. If I read Steve correctly, he prefers the term log-optimal
strategy, which is mathematically more precise, and is one of his
alternative strategies that he was written about in the past. See
also: http://members.cox.net/vpfree/FAQ_S.htm . I prefer the term
Kelly because it gives another way for someone to research the topic.
I.e.: http://www.google.com/search?q=kelly+gambling+strategy

I agree with much of what you say here, but part of my point is that
"bankroll growth" can mean different things to different people, and
the phrase isn't necessarily synonymous with "geometric growth".

I don't object to "Kelly" as a term, but I think it is ambiguous. To some,
Kelly means only the Kelly Criterion formula that is used to choose bet
size. To others, the term "Kelly" triggers thoughts about the underlying
log-optimal goal, which can be extended to finding a complete log-
optimal solution for playing strategy as well as betting strategy. I tend
to think of Kelly in these broader terms.

Discussions of Kelly are often difficult. I agree with "cdfsrule" that
Kelly isn't particularly "special" in any mathematically meaningful
sense. In some gambling circles, such a statement is considered
extreme heresy. Many gamblers seem to believe that Kelly is
the ultimate "One True" measure of gambling performance. In my
view, such gamblers have merely traded in their "EV is everything"
religion for a new, (improved?) "Kelly is everything" religion. I view
EV and Kelly both as mathematical tools rather than belief systems,
and there are plenty of other tools in my tool box. They are all
useful, in different ways, but I don't feel that any of them warrant
status as "best tool" in any absolute sense.

···

On Saturday 24 December 2005 12:59 pm, nightoftheiguana2000 wrote:

--- In vpFREE@yahoogroups.com, "cdfsrule" <groups.yahoo@v...> wrote:

[nightoftheiguana2000]

The problem with Kelly is that you have to define "bankroll" to include
one's entire net worth, and to exclude the possibility of income from
another source. Then, if you lose everything, you are truly screwed.

I'm not sure that is correct. Seems to me the Kelly bankroll is the
gambling funds/investment account/nest egg, it doesn't have to be
one's entire net worth, and it can be added to or subtracted from, in
addition fixed returns (such as bank interest or inflation) can be
accounted for. But, if you "lose everything", you are "screwed", i.e.
this isn't pocket change, it represents a substantial part of your net
worth, i.e. you would miss it if you lost it.

Even if you do that, I believe there are people who would risk it all
for a good shot at a huge reward. For such people, the Kelly model
doesn't apply (at least, not perfectly).

Totally agreed. I think Bob Dancer calls that "taking a potshot", but
he wouldn't risk it all, he essentially puts in a stop loss limit when
playing underbankrolled. And I'm not claiming Kelly applies to everyone.

Discussions of Kelly are often difficult.

Speaking of which:

Title: Fortune's Formula : The Untold Story of the Scientific Betting
System That Beat the Casinos and Wall Street
Author: William Poundstone
Publisher: Hill and Wang (September 14, 2005)
ISBN: 0809046377

···

--- In vpFREE@yahoogroups.com, Steve Jacobs <jacobs@x...> wrote:

[nightoftheiguana2000]

I thought this might be interesting to flush out a bit with an
example. Kelly strategy accepts 0 ror. What if you are willing to
take, say, a 10% risk of losing it all? All being defined as the point
at which you will quit this particular project, i.e. your ultimate
stop loss limit, not all your worldly possessions. (Again the
gambler's anonymous issue of having a stop loss limit that you
actually stick to.) And, you have a choice of two games, either FPDW
or a monster DDB progressive (rf=1600) that no one has hit yet but
it's ready to go any moment now, so they say. Using:
http://wizardofodds.com/videopoker/analyzer/CindyProg.html , the FPDW
has an er=1.0076 and 10% ror bankroll of 3525 bets, the DDB
progressive has an er=1.0127 and 10% ror bankroll of 8503 bets. Which
is the better play? Based on er, the progressive is better. Based on
average bankroll growth
(FPDW:1.0076/3524=0.03%,DDB=1.0127/8503=0.01%), FPDW is better. Based
on Kelly criterion, if your current bankroll is 2924 bets, then the
FPDW is the optimum bet, if your current bankroll is 8310 bets, then
the DDB progressive is the optimum bet.

···

--- In vpFREE@yahoogroups.com, Steve Jacobs <jacobs@x...> wrote:

The problem with Kelly is that you have to define "bankroll" to include
one's entire net worth, and to exclude the possibility of income from
another source. Then, if you lose everything, you are truly screwed.